By Eric Mosley
The annual performance review is frozen in time. It's a relic of the way business used to work and doesn't capitalize on the way business works today. Employees and employers both dread it. Can it be saved?
In The Crowdsourced Performance Review: How to Use the Power of Social Recognition to Transform Employee Performance (McGraw-Hill, June 2013), author Eric Mosley examines the current the performance review system and proposes a new model, adding practices that keep pace with extraordinary changes in business thinking, social technologies, and company culture.
Mosley, co-founder and CEO of Globoforce, envisions raising recognition from a tactical, unmeasured, and undervalued effort to a global, social, and strategic program with clear measures for performance and success.
He says it’s time to address a system that has long surpassed its current structure and use a new way to manage performance through a system that is in tune with today’s global, social, and multigenerational workforce.
He maintains that today’s most successful companies are transforming their predicable “one-way” review processes into dynamic, collaborative systems that apply the latest social technologies. Instead of a one-time annual evaluation of performance, managers and employees receive collective feedback from everyone across the company. This is achieved through “crowdsourcing”—feedback from everyone across the company. He says crowdsourcing generates more accurate e, actionable results than traditional methods.
Mosley believes that by following his strategies, companies can create higher levels of engagement, energy, and even happiness in a company. He answered the following questions about his new model.
Why is The Crowdsourced Performance Review needed?
There’s a huge sea change happening in Human Resources. There have been revolutions in knowledge and information management over the past 50 years, but areas of HR such as performance management have changed surprisingly little. Now, social technologies and crowdsourcing create fundamentally different approaches to HR work. This is the time to take advantages of the big changes and update our approach to recognizing and rewarding good performance.
What is wrong with the traditional annual performance review?
The first chapter of the book exposes the flaws of the traditional performance review and its many problems. Its weakness is that it focuses on one manager’s opinion about one employee, and ignores the collective wisdom of the wider community, that is, everyone the employee touches over the course of doing his or her job. In systems thinking, this is called a single point of failure. It’s a dangerous flaw. One manager can’t see an employee’s total activities, let alone the results. Multiple people, however, can, over time, collectively produce a more accurate and nuanced picture. This is a process we call social recognition.
What’s social recognition?
Social recognition is a simple set of practices by which many people consider and recognize an employee’s performance on a daily basis. This is done on a shared technological platform, similar to the web but privately managed within an organization. Social recognition conclusions are based on multiple sources of feedback, generated in real time and using powerful database analysis to guarantee accuracy
This is your second book. Tell us how you arrived at the need to write it.
When we started our first book, the social media phenomenon was in its infancy. Twitter had 6 million users. Now it has more than 500 million users. Facebook wasn’t the globally dominant brand it is today, with more than a billion users. Online social behavior was experimental and these big changes were just gathering steam. Now it’s habitual and universal.
Additionally, even though the systems we now call big data were getting underway, very few people guessed that the wisdom of crowds enabled by big data would soon become pervasive in daily life—enabling everything from online shopping to managing rush-hour traffic.
HR is still barely aware of the implications of combining social media with big data. We had to take a new look at all of this because so much has happened in those few years.
Why is crowdsourcing such an important phenomenon for HR?
HR is all about people. And social technologies are also all about people: communities, connections, and the wisdom of crowds that’s been studied and proven. For example, the book discusses how crowdsourced “star ratings” on Amazon, iTunes, Zagat.com and a thousand other services changed our way of judging value. Similar crowdsourcing can fundamentally change HR because it measures the interactions of human beings, and then leverages that data to uncover all kind of useful, hidden insights for managers.
Would a crowdsourced performance review completely replace the traditional review system?
The traditional performance review brings formality and structure as well as a nice cadence to the interaction between management and employees. If there is little crowdsourced data about performance, for example with a remotely located employee, the traditional review acts as a safety net so he or she has at least some feedback.
The genius is in the middle, combining one-time, formal reviews and informal frequent recognition. As the crowdsourced performance review and the traditional review harmonize, performance management really takes off.
Eric Mosley is co-founder and CEO of Globoforce, headquartered in Southborough, Massachusetts and Dublin, Ireland. He is a graduate of Trinity College, University of Dublin.