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To keep your job you have to be “excellent, necessary and trustworthy,” according to Elon Musk. But does Tesla’s Technoking even pass his own test?
The maverick CEO of the electric car maker and co-founder of companies like SpaceX has spurred lawsuits and SEC investigations. Sudden changes in direction occur regularly in their businesses due to their autocratic decision-making style, and the work culture is so demanding that it results in high burnout and staff turnover. Musk’s own employees and investors may conclude that there are enough reasons to show him the door, but unfortunately for them he is the one in charge.
However, Musk’s comments raise a more serious question: What is the correct and fair way to judge worker performance? And can managerial bias ever truly be eliminated?
Large companies often turn to performance reviews to provide a structured way to give feedback, help employees understand their strengths and weaknesses, and provide advice on career development. In theory, they are an opportunity to recognize and reward good work, while motivating staff and boosting morale. Employees can also express their complaints.
But they can be time-consuming and stressful, especially if they are not used to think meaningfully about future development. While a company may strive to be meritocratic, these reviews can be very subjective and often reflect personal biases. Different managers They have their own ways of carrying them out, which can lead to inconsistencies throughout the workforce.
The new data from Gallup is revealing. Only 2 percent of human resources chiefs at Fortune 500 companies who were surveyed by the survey and consulting group strongly agreed in their Performance management The system inspired employees to improve. Employees were equally negative: Only one in five said the reviews were transparent, fair or led to better performance.
It’s no surprise that many union members don’t trust performance reviews. Reluctant and accidental managers: a staggering proportion of the total according to the Chartered Management Institute – nor are they likely to rush into it. In response, some companies are choosing to replace reviews with more frequent and informal check-ins between managers and employees.
But even as organizations have discarded performance ratings, they have found a need for some type of documented annual evaluation to help them make decisions on issues such as promotions and pay raises, McKinsey research shows. This means that, especially in large organizations, there is no way to avoid them completely.
“This is probably the most important thing to solve when it comes to managing people,” says Tomas Chamorro-Premuzic, organizational psychologist and people analytics expert. “If you really can’t evaluate an individual’s performance without some degree of objectivity, you can’t do anything more meaningful in terms of running a business well.”
He went through a list that included hiring and promoting the right people, doling out bonuses, determining the next generation of leaders, and building successful teams. An objective system is also essential for diversity in the workplace, as people from non-traditional backgrounds may find it more difficult to navigate an informal structure.
Most performance appraisal forms provided by companies ask managers general questions about their employees. Bosses then complete their evaluations, critiques, and other feedback. This open-ended approach is partly to blame for bias. Establishing objective criteria for managers to judge workers, including specific personal and team goals and involving employees themselves, can help achieve more honest and transparent evaluations.
It’s also important to foster a feedback environment where conversations with staff occur more frequently than at the end of the year or quarter. Managers should be empathetic, curious, open to criticism, and use reviews as a way to change their own practices.
“Traditional performance management never worked, where objectives were set at the beginning of the year and reviewed at the end. “We are in a dynamic world where things are constantly changing,” says Ben Wigert, director of research and strategy for Gallup’s workplace management practice.
Bosses should aim for “one meaningful feedback conversation per week,” he suggests. Managers can discuss an employee’s priorities, what support they might need, recognize good work, check on their well-being, or have a difficult conversation to make sure a problem doesn’t get worse. “This is the key to doing it well. It is an ongoing process and conversation where constant adjustments are made to goals. “This all ends in the end-of-year review, where nothing should be a surprise.”
Readers may balk at the idea of such frequent interactions, but if managers were more in tune with their employees, perhaps workplace relationships and team performance would improve. And if things don’t work out, there’s earlier warning.
As for Musk, it’s clear that performance reviews are a one-way street. As one Reddit user said about him last week: “[You] “I can’t be replaced as CEO if you fire everyone else.”