Performance Conversations vs Career Conversations

I’ve been having a few conversations lately about the difference between performance conversations and career conversations and I thought I'd gather my thoughts in this week's newsletter.

The newsletter is focused on the following areas:

• What’s the difference between a performance conversation and a career conversation?
• Why does the distinction matter?
• Should we even have performance reviews?!
• What makes a good career conversation?
• Our Career Canvas template

It’s a big topic, so I’ve linked to articles and resources that I’ve found useful if you want to dive a bit deeper.

What’s the difference between a performance conversation and a career conversation?

A performance review looks backward. Career conversations look forward.

This article from Culture Amp is one of the best I’ve found on the topic. In it, they differentiate performance conversations from careers conversations in the following ways:

Why does the distinction matter?

We approach these conversations with a very different mindset. This mindset affects the questions we ask and our engagement in the conversation.

Performance conversations are often linked to compensation and the theory is that this source of extrinsic motivation (pay/bonus/reward) gets in the way of the intrinsic motivation we get from learning/growth. We can’t engage fully in a career conversation about the future when our minds are so drawn to our present performance and its impact on more immediate rewards.

When we unhook the two conversations, we also increase the quality of the feedback that people get. Research shows that peers are more likely to give constructive feedback when they know that it doesn’t have a negative impact on their compensation.

Should we even have performance reviews?!

There is a school of thought that performance reviews should be scrapped. Some stats that would seem to support this view:

• 95% of employees are dissatisfied with their company's appraisal process.
• 90 percent of employees don't believe the process provides accurate information
• Only 14% of employees feel strongly inspired to improve after a performance review

This article gives the example of 3 organisations that have moved away from performance reviews and replaced them with something else:

The 'something else' seems to be an enhanced 121, which has the benefit of considerably increasing the frequency of the discussion. However, this article from HBR states getting rid of the performance management conversation/process might not be the right thing to do.

“Performance is the value of employees’ contributions to the organization over time. And that value needs to be assessed in some way. 

The authors emphasise that the performance management conversation remains useful providing actions taken to reduce bias and increase transparency. Examples of how this can be achieved:

1. Reduce bias by having peers write evaluations and managers all getting together to debate performance reviews. This reduces the risk of personal opinion determining performance outcome. Facebook is given as an example of a company that also use a team of analysts to examine performance reviews for bias (e.g. are words like “abrasive” used more often to describe women—and do they have an affecting on their assessment, promotions and pay recommendations)
2. Increase transparency by being clear about the capabilities being evaluated. At Facebook, they include technical contributions, team contributions and planning and execution as key dimensions that contribute to the overall performance rating. There are other great examples of transparency such as Buffer, who release all the salaries of their employees and how they are derived with their salary formula. Another example at the extreme end of the scale is Bridgewater Associates. Their CEO Ray Dalio created ‘The Dot Collector,” as a tool to support radical performance transparency. Everyone has access to The Dot Collector app and in meetings they ‘real time rate’ people for their performance and all ratings are public. He talks more about this in his TED talk.

Ultimately, I’m in the camp that reviewing a performance is still a positive thing if:

• There are high levels of psychological safety in the culture and trust in the relationship between the manager and their direct report (we have a great podcast on this topic with Dr Amy Edmondson)

• They happen frequently and are followed-up on (e.g. they form the basis of a continual conversation rather than feeling like each one starts from scratch)
• And on the topic of whether pay should be decoupled from the performance conversation, I think if you there are separate career conversations focusing on growth and development, pay and reward can still form part of performance conversation.

So, what makes a good career conversation?

This is really where we focus at Amazing If. Having the capability within an organisation to have high quality career conversations is an important part of helping people to succeed in squiggly careers (and keeping those people in the business)

Research shows that people aren’t having the number of career conversations they want to have and the conversations they do have don’t meet their expectations. The research also shows us that for organisations that get it ‘right’, people are more committed to the organisation.

Some principles of good career conversations for individuals:

• Ownership – you need to drive and direct the conversation to get the most out of it
• Ongoing – career conversations should be continual and not only triggered by a desire for a new job or an annual process. Prioritise career curiosity and make it part of how you approach your work.
• Open – career conversations don’t just have to happen with your manager! You can have more frequent conversations and get far more insight if you open up the conversation to include peers, mentors, past managers and people who may be able to help you to explore your possibilities

This Squiggly Careers podcast episode on career conversations might be a helpful listen for you:

And for managers….

• Climate – think about how you set the conversation up for success. Is the trust there? Does your team member feel like they have the permission to be open? Are you present? Have you dedicated the time this conversation will require?
• Conversation – are you clear on where they want to focus? Do you know the different conversation areas that contribute to effective career development discussions (see our Canvas below if not)
• Coaching – your role is to unlock their thinking and not to be the source of answers. Taking a coaching approach where you prioritise listening and questioning will increase the depth of their thinking and ownership of their actions.

Our Career Canvas

The tool we find most helpful to support career conversations is the Career Canvas – we help individuals to complete this and managers to support career conversations around it. I’ve included it below so you can see the key dimensions we think are helpful to consider in career conversations (note – all these areas don’t need to be covered in one conversation and/or with one person).

If it’s helpful, I can do a future newsletter on how to use this Career Canvas. Just let me know in the comments.

Appreciate there is quite a lot in today’s newsletter! I hope it’s still interesting and helpful for you.

To find more about the work we do at Amazing If to make careers better for everyone, please go to www.amazingif.com.

Helen