The necessary evil of performance reviews

Why we hate reviews, why they're sticking around, and what they can teach us about continuous feedback.

This is a summary version of this week's article in Yen's Newsletter. You can read the full article here.

Today we’re talking about the “p” word. Getting our head out of the gutter, that word is “performance review”.

This is the funniest joke I could come up with for a process that makes everyone in the organization groan, sweat, and squirm. Performance reviews feel like a bureaucratic artifact from Big Corporate, the “uncool thing” that stuck around as tech companies made all other work things cool and fun. It’s the (bi)annual reminder that performance isn’t something you do, but something you need to track and prove.

Performance reviews are a necessary evil. And even more necessary today, when driving high performance and hitting targets is top priority.

It’s a whole process and any People Ops team who’s weathered this storm knows to prepare well in advance. I’ve seen detailed how-to documentation explaining the 9-box and color-coded rubrics for every job title. I’ve seen distribution timelines outlining step-by-step reminders and deadlines, calendars that would make any marketer proud. I’ve seen People teams spend weeks assessing performance review softwares, hoping to make it 20% easier for all parties involved. Don’t get me started on the months of effort that follows, trying to get managers to use that software so performance reviews are bearable.

People teams put in the hard yards, and yet, no amount of preparation seems to make this process easy. Every year, managers bring up documentation questions and performance hiccups. Every year, an executive suggests that performance reviews should be gutted. And every year, People teams realize something’s broken about how performance is measured and documented at the organization.

So why does the performance review process suck so badly, why are we still doing them, and what can it teach us about feedback?

Let’s dig into it.

You’re Right. Performance Reviews Suck.

Whether you’re facilitating, participating, or being reviewed––performance reviews are a pain in the ass. You’re not the only one thinking it, and I say this because it’s easy to think of yourself as the victim and the other players as the source of your stress. Put simply, it’s the fault of the review process itself.

We’ve talked to dozens of leaders at every stage of the performance review process. Our key takeaway is that everyone struggles with performance reviews. Here’s why:

For People Ops

The biggest problem is company alignment and quality.

Performance review season is the ultimate exercise in herding cats. There are dozens of steps, documents, and deadlines to communicate to an organization who’s focused on other targets. People Ops teams are facilitators for an unpopular process, and they have the challenging job of making sure it’s run properly.

People Ops teams are great at the documentation and preparation needed to get the process running. However, the real challenge isn’t meeting deadlines. It’s making sure the steps are done meaningfully.

We talked to one People Ops manager at a large tech start-up about why they’re revamping their performance review process this year. The keyword? Quality.

We've seen our people complete their assessments––whether they're self-reviews, peer reviews, or manager reviews––right up to the deadline. I feel like having that short of a time frame can reduce the amount of care and attention. They’re filling it out to get it done because it's a deadline, versus really being thoughtful about what they’re saying and how it's coming across.

In order for performance reviews to step beyond an HR mandate, participants need to understand why the process exists and the goals this process is hoping to achieve. In an ideal world, everyone understands that performance reviews are there to achieve a number of things: support promotions and career ladders; celebrate accomplishments and point out areas of opportunity; and most importantly, aggregate all the feedback that’s been shared over the year.

Unfortunately, the reality is that performance reviews have become the only reliable process for performance feedback at a lot of tech companies. It’s a lot of pressure for one process, and it actually causes the performance review to fail these other goals and fold in on itself.

This is most apparent in the questions People Ops folks receive during performance review season. If only I had a nickel for every People Ops person and HRBP who got asked, “How do I tell my direct report that she’s been underperforming?“

The People person responds with, “Have you given them this feedback yet?“

They realize the manager hasn’t documented any of their feedback. They realize that the manager hasn’t had a conversation up until this point and that the direct report has no idea. The manager and People Ops person know there’s going to be a big discrepancy in the self-review and manager’s review. They have to plan for unfortunate next steps. The only thing worse than delivering a PIP is delivering a PIP that the receiver didn’t see coming.

People Ops teams are put in an awful position. Everyone hates performance reviews and People Ops teams have to uphold this necessary evil. Reviews enforce feedback documentation and accountability. They become the only way to consistently catch these fires before they turn into employee issue nightmares.

For Managers

It’s hard to compile long-term patterns and format that into tough feedback.

We recently spoke with a manager at a mid-sized start-up who had 10 peer and downward reviews to write this performance review season. With her People team’s recommendation to spend about 30-minutes compiling each review, that was already five hours worth of work to squeeze into her packed schedule. The reality is that it took her longer than 30-minutes to write each review, and she had to work overtime and on weekends to get everything submitted on time.

Managers are some of the busiest people in an organization. It’s not surprising to see their schedule filled with back-to-back meetings, high-level IC work, and firefighting. Regardless of how you present it, performance reviews are extra work on their plate. It’s often extra work that feels unnecessary and painful. In the manager’s eye, you might as well call performance review writing an HR-mandated hell week.

When we look at the steps needed to complete a single review, we can see the areas of friction. Most managers don’t remember what a teammate did more than two months ago. They’re given the choice to either lean into recency bias or to compile the last year’s worth of Asana todos, one-on-one notes, project results, wins, career growth, and company values. By the time they gather everything and find patterns, the real challenge begins. Managers need to compress their thoughts neatly into questions like “How did this person’s performance reflect our company values?”

Writing a performance review is the most stressful piece of writing most managers need to do in a year. They know that the person they work with every day will be reading and potentially taking offense to what they write. They know that what they write has stakes and can deeply affect the promotion cycle. They also know that what they write will be the source of truth for a deeply awkward conversation a few months down the road. If you’ve ever had to give a teammate difficult feedback, you know the strong emotions and self-doubt that plague this process.

Put simply, writing a single review that’s worth reading takes much longer than the recommended 30-minutes. One manager estimated that writing a review properly would take them at least half a day. It’s no wonder why performance reviews feel rushed and disappointing––the existing process isn’t set up for success.

The grief only continues with the performance review conversation months later. One manager told us about a recent conversation he had for his reviews.

There’s a lot of stress and anxiety on both ends. During my last performance review, I gave my direct report high praise into all the effort he put into his work. But he wanted specific praise on the mentorship work he did with junior developers. He was hurt that I didn’t bring it up.

For Teammates

It’s discouraging to get feedback you can’t take action on.

A lot of teammates aren’t afraid of performance feedback. They’re hungry to get confirmation on what they’ve done well and what they need to improve on. If there’s a discrepancy, ideally this process gives them a chance to know right away and improve quickly. Some of the highest performing teammates I know see performance review season as an opportunity to be seen and advocate for their career growth.

That’s why a lot of teammates get discouraged when the performance reviews they receive feel rushed. These reviews often lack the care or attention required to make the review actionable. One teammate we spoke to summarized this sentiment, “I hate reviews because they're not useful for me. I really want feedback that I can use.“

While there’s an entire spectrum of useless reviews, bad reviews can ruin employee relationships. There are two types of extreme reviews that we’ve seen teammates deal with: the mean review and the “too nice” review.

The mean review lacks the “Care Personally” aspect of Radical Candor, and can read like hate mail. One teammate described an awful review they received in the past:

I've had reviews in the past where they didn't give a shit about my feelings and didn't give a shit about my motivations. They just told me they thought I was a bad person. It's completely useless. I couldn't do anything with that feedback.

Meanwhile, the “too nice” review overdoes the “Care Personally” aspect of Radical Candor, and is designed to play HR theater. Some managers refuse to give any bad feedback on reviews for fear of having it documented in such an official way and affect the teammate’s prospects. While well meaning, the end result is a missed opportunity for the teammate to improve.

The spoonful of sugar in the “too nice” review can turn into a shitstorm fast. A teammate who receives a glowing review and a PIP only a few months later can feel tremendous whiplash, and cause a headache for everyone involved. In the worst cases, the opportunity for the teammate to improve has passed. When there’s a lack of documentation, underperformance drags on and builds resentment. Blech.

Why We’re Stuck with Them (For Now)

All this discussion of performance reviews is pretty bleak. It’s probably why there’s been a years-long, ongoing debate about their effectiveness. We can look at the goals we initially set out for performance reviews (namely, to drive a culture of high performance and growth) and ask whether performance reviews move the needle.

The argument to get rid of performance reviews pops up every performance review season. It made headlines back in December 2023, when Jack Dorsey announced that they were ending performance reviews at Block. In a message to employees, he stated,

I want us to build a culture of excellence. Excellence in service to our customers, excellence in our craft, excellence in our respective disciplines, and excellence to each other…Our current "performance management" practices do not help us achieve this. In fact, they are holding us back. Some have described them as a "denial of service attack on managers" given the time commitment versus the benefit to our people. [T]his is the last "annual performance review cycle" we'll have. It's way too heavy for everyone involved and it doesn't actually help us get better. Performance should be continuously evaluated, and feedback should not be queued up for later. There are natural and asynchronous milestones that are specific to individuals and teams, like launches or product completions, that will force our leads to be more specific and personalized with feedback, promotions (which need to be dramatically simplified!), compensation, or whether to part ways immediately (instead of letting things linger)…

Dumping the entire performance review process sounds sexy. Everyone hates them anyway. The idea of saving everyone from documentation and grief, while still achieving accountability and clarity, can get anyone on the “kill reviews” bandwagon.

However, I think the headline “EX-CEO OF TWITTER DUMPS PERFORMANCE REVIEWS” fails to capture what’s happening here. Jack Dorsey isn’t completely gutting performance reviews, he’s replacing it with continuous feedback and regular performance check-ins.

I’m a huge advocate for continuous feedback. I also know that, for most tech companies, it’s often more idealistic than realistic.

After working and researching manager excellence for the last four years, feedback is one of the hardest things for managers to get right. Managers will often avoid feedback or a difficult conversation, hoping the situation will blow over with time. If they do give feedback, they may not be clear and kind. They may be too clear or too kind. It’s a massive balancing act, and a skill that requires intentional development.

Talking about development, feedback also happens to be an incredibly challenging skillset to build at scale. You can’t run a single workshop or assign a reading of “Radical Candor” and expect to have a continuous feedback process. Feedback is one of the manager skills that defies theory and requires consistent practice and bravery to build. It hinges on your company’s investment in manager development and your ability to train managers.

In short, maintaining a continuous feedback process is a gargantuan task for People Ops teams who are already spread thin. For most companies, it’s 10x easier to run a solid performance review process than it is to drive consistent continuous feedback.

I think I can speak for a lot of People Ops leaders, I wish it was that easy to cut out performance reviews and flip on the continuous feedback switch. One People Ops leader that we were chatting with summarized it best:

Our CEO caught onto the “no more performance review” trend. But that model only works if you have really good rigor around feedback. Unfortunately, we don’t have that. Our leadership team has decided that we need to do performance reviews. We’re trying to pare down the process to make it less labor-intensive for our managers. But it will be mandatory to have the feedback conversation and think critically about your team.

TL;DR: you’re stuck with performance reviews until you can replace them with a better continuous feedback process.

How to Talk About (Bad) Performance

If we can’t change the performance review process for now, we might as well teach managers how to talk through performance and navigate difficult conversations. No one likes telling someone that they’ve done a bad job. Discussing a difficult review is one of the hardest and emotionally-charged parts of this process, and requires the most coaching labor from People Ops teams.

Here’s my quick guide for leaders, and one of my favorite script templates to help. Feel free to borrow it and share it!

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I’m Yen, co-founder at Kona. My goal is to help every manager be a great leader. You might be managing a team yourself, or supporting better managers at your organization. Hopefully, this newsletter helps you look at the ever-changing landscape of leadership in a new way.

Since late 2019, I’ve interviewed 1500+ remote managers, People Ops leaders, and tech executives to learn how they lead teams and design incredible distributed company cultures. While every company’s different, everyone’s trying to answer the same big question: “How do you enable amazing people to do amazing work, while remote?”

That’s the great thing about big questions, they bring people together. Learning is sharing, and I’ve always looked to share everything we know as soon as we learn it. That's the goal for this newsletter: capture and synthesize all of our remote management learnings in a neat and shareable archive.

Every week, I’ll alternate between self-written articles and interviews with industry leaders.

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