Annual Reviews Are Killing Your Team! (and Your Business)
“The success of your company is based on the average ability of your team. Up the average by raising the lid on the leader.”
The Bell Curve Is Wrong
I love reading articles and studies. More than that, I love reading the intelligent (good) comments after the articles. There are some great insights and they have a tendency to bring accountability to the concept. Granted there are some funny or dumb comments to, but I filter them out to get to the truth. For most of us, we resonate on a particular concept—not the whole issue—which makes us experts in a single thing, sometimes more-so than the person who wrote the article. I get to gain from many different “vertical experts” way beyond the original author. I love it.
While I was working on one of my favorite topics—how to help companies succeed more, faster, better, I was also working on a new quote—the one above—when I came upon several articles and studies about “Bell Curve” vs. “Power Distribution Curve.” Or, in human terms, the Bell Curve shows average distribution above and below the middle, and Power Distribution is a few high performers and a long tale downward of “less then highest performers”—meaning there are a few top performers, then a big drop, and then the rest of the world in a long line of average.
Everyone A Superstar?
The point behind the articles was to show that we need to pay and push our high performers and grow our not as high performers to be superstars as well. Makes sense—been doing that for decades. It seems that we have been living in mediocrity by using the Bell curve and pay most of the salary to the middle 80% who are the (GASP!) average performers, thus forcing our superstars to look for better pay elsewhere. I concur.
This is all well and good, but not the take away I got. Well, actually, it is a takeaway I got, but more importantly it sparked me in a different direction. One of the main problems was that because we typically do an “annual review,” there is too much time for both superstars and up-and-comers.
Annual reviews are killing your company
If you’re waiting a year to give the necessary feedback and pay adjustment it’s negative accountability instead of positive accountability and fails to help in a timely manner to get to the success everyone on the team wants—both employee and leadership. It’s too long a period for your superstars who need to be moved up as fast as they can go, and it’s too long for your upcoming performers because they need to be groomed and trained into superstar status. The only people that are happy with an annual reviews are average and poor performers.
Of course, it’s not all about making money and being a superstar. It’s okay to be average and middle of the road, right? Do you know anyone that would answer “yes” to the question, “Is your goal in life to be mediocre?”
A good friend of mine likes to say that we all have genius in us. And I think he’s right. Just depends on what topic and that spurs that on. Like Susan Fowler’s “Why Motivating People Doesn’t Work…”—because they are already motivated—you just need to find out what it is that they are genius in.
So when do we review?
Daily. Yep. We reflect daily. Definitely no longer than weekly. For each of our people. We use positive accountability instead of the annual accountability. When you hire a person, you need to lay out their path to success in a detailed fashion, and work daily to help them achieve it. Not necessarily you, but your team. If you could help a team player get 1% better each week, you can get her 64% better in a year—or even better.
Too many managers have a “set and forget” mentality and we’re not helping our people be their absolute best. We hire mediocrity, train them in a mediocre fashion, and accept mediocre results. And as long as we’re making a profit, things don’t change much. That’s like living the adage “If it ain’t broke, don’t fix it.” If it ain’t broke, figure out how to make it better so it will last longer when it finally does break! The world follows those who make a better battery.
So as a leader, how do you raise your lid and everybody else’s lid? Training, training, training. If you cannot do it, get someone else to do it or buy it. Lack of leadership is the #1 reason businesses fail. As a result, if you excel at leadership instead of fail at it, you’ll push your company way ahead of the curve—and the competition.
Like Zig Ziglar used to say (and now I always say), “Would you rather train your people and potentially lose them or not train them and keep them??” Eduction is expensive—but ignorance is more expensive. When you don’t know that you don’t know, you’re at the first step looking down.
Press on to success
1. Sit with each team member and define their success plan together. Get their buy-in and turn them loose. Define superstar status and help them push through it. As they hit milestones, reward them in many ways. If they need training—and everyone does—get it! A couple hundred dollars can yield thousands in returns! If they’re not cut out for this job but they are great in something else you need, move them over and watch them shine—and watch your company shine even more.
2. Meet weekly for just a few (<15 min) to see how you can add value to them, mentoring and training them along the way—or simply the best way to stay out of their way. Short and sweet—no micromanaging. CAUTION: If your’e not a people person and don’t work well with people do these two things:
a) Don’t be lazy—GET GOOD at being a people person. All great leaders are people persons; and
b) in the meantime, get someone else on the leadership team who is good to help them while you are getting good.
If they’re a superstar, get them a coach. It will cost you on average $7500 per year. BUT it will yield tens and hundreds of thousands in additional results. No penny-wise and pound-foolish here. Just do it. I see it add huge success to team members all the time—I mean every day. While you’re at it, get a coach yourself and push your leadership lid toward awesome.
3. Use Positive Accountability—peers working with peers—to hold one-another accountable to succeed. Doesn’t take the place of a manager or leader, but adds a great opportunity for success.
The stakes are too high If you have to wait for an annual review. There’s too much riding on it and too much pressure. If you wait that long to do what you should be doing daily or weekly, you’re already not gaining as you could—and the competition will pass you by without blinking.
Reflect: How can you help your people make themselves and you a better success? Do you have what it takes to get everything you can out of your team?
Action: Get training and coaching for your team. It will pay off in much greater profit for all.
Make it a great day!