waiting for performance review
No matter what side of the table you land on, everyone dreads the annual performance review PHOTO: John Lawlor

Whether you are on the giving or receiving side, not many people look forward to annual review time. The sense of foreboding is understandable given that the conversation revolves around accountability.

So with teams, managers and individual contributors setting expectations and goals for the year ahead, I'm going to explain how to understand — and eventually transcend — the dynamics of the performance review process, known in some circles as "The Expectation Game."

New Year, New Expectations

Businesses employ many terms to articulate and codify performance goals for the year. One of the most common is "expectations." 

Performance reviews judge people on perceived performance relative to expectations. This yardstick is why many corporate performance review systems use the terms "Meets Expectations," "High Meets," "Low Meets" and the ever-elusive "Exceeds Expectations."

When a new year rolls around, managers and employees strive to articulate "SMART" goals (Specific, Measurable, Achievable, Relevant, Time bound). While obviously a good thing, this task often lacks the detail and supporting structure to allow for full engagement and attachment by either individual staff or leadership.

For example, an articulated SMART goal should by definition have a measurable outcome. But how should that measurable outcome be considered when thinking about the difference between "exceeds expectations" and "high meets"? Or between "high meets" and "meets"? Are the distinctions specific to each goal or is there a guidepost that managers can apply to allow for judgements to be made at least semi-objectively?

Anchor Goals to a Structured Model

I've played the expectations game from both sides of the table and, in my experience, those who succeed anchor their goals and judgements directly on the terms embedded in the performance management process — especially the term “expectations." 

Having a structured model for what divides the achievement levels relative to expectations can both generate alignment on the goals themselves and in reasonably judging performance relative to goals. But for a structured model to work, it has to be abstract enough to apply to a wide range of work and concrete enough to be easily applied by contributors and management alike.

One model I've used and seen gain meaningful acceptance is to segment achievement levels based on the management concept of control vs. influence where:

  • "Meets Expectations" is defined as "what can reasonably be done, at your level, within your local span of control"
  • "High Meets" is defined as "what can be done, at your level, with collaboration from your peers who are part of the same department” (i.e., you have shown that you can use influence rather than control to accomplish work)
  • "Exceeds Expectations" is defined as "what can be done, at your level, with collaboration and buy-in from people outside your department within the wider enterprise” (i.e., "you've exceeded expectations when you achieve what no reasonable person expects you are supposed to with the tools you are given, your level and within your span of control")

In this model, "meets" should be relatively easy to achieve but not a gimme, and "exceeds" should be significantly challenging but not fundamentally impossible.

Does it Pass the Sniff Test?

To see how this would work within context, let's say your team has decided that consolidating the number of CMS templates is critical to your department's success. The goal statement and levels could look like this (assuming you could put appropriate constraints as needed by your organization):

  • Goal — Before the end of Q4, consolidate the number of CMS templates used in production by 20 percent
    • Meets Expectations — Articulate a future state set of templates and a list of what templates will be decommissioned. Create a map for how to migrate existing content to the new templates
    • High Meets — Develop alignment on the future state templates and migration map with the content organization
    • Exceeds Expectations — Get stakeholder buy-in to fund, execute and release the new template system

The exact details of the goal above aren't important. The segmentation of the levels along the lines of direct control and influence is, specifically because individual contributors need to develop skills and mastery in the area of influence in order to advance both the enterprise and their careers.

Aside from an easily applied conceptual model and a team working towards an open mindset, you also get a reasonable sniff-test for how to judge achievements that might not meet the word of the goal, but do meet the spirit. 

Imagine in the above example, your team reduced the number of templates by 15 percent but got the effort agreed to, funded and executed before Q4. That might qualify for "exceeds." 

Conversely, imagine in the same example if your team reduced the number of templates by 22 percent but left several stakeholders feeling unheard. Even if they got it funded and executed before Q4, that still might not rise to the level of "exceeds" because the team did not achieve the appropriate quality of influence.

The Moment of Truth: The Annual Review

So now that you have an idea for how to structure your team's or your own goals in a way that can be understood and applied in a wide array of contexts, let's jump to the annual review session at the end of the year.

Regardless of which side of the table you are on, you enter the room prepared with your thoughts about execution relative to expectations. You're thinking you've got it all under control with your facts and figures. 

I'm sorry to say, that's not all you need. You need to master at least two other concepts in order to walk out of that room with the best chance for alignment:

1. The Red Face Test

In terms of goals, achieving the exact terms of the goal is not enough to be given the rating that matches the terms, because of the unspoken part of the expectations game known as the red face test. You fail the red face test when you can't answer a question honestly without either your face turning red from embarrassment or having your boss's face turn red with anger. 

Imagine you did every single agreed upon thing, but three days a week you showed up to work in a speedo. Unless your name is Michael Phelps, that's not going to go over well. 

All achievement rewards have the same fine print — it's not what you do, it's how you do it. If anything you've done, or haven't done, related to a goal over the last year fails the red face test, prepare to have any favorable judgment thrown away.

2. Recency Bias

Who's the best basketball player ever? LeBron? Jordan? Recency bias skews review ratings as much if not more than professional sports questions. 

If you are planning for your review, make sure to end the year strong with eye-grabbing headlines. If you are giving reviews, keep track of early and mid-year events and accomplishments so that you can judge with a holistic mindset rather than over-index accomplishments from the back half of the year.

Play at Your Own Risk

One thing to know: once you get good at playing the expectation game, people will notice. Whether it's your peers, your leadership, your HR partners or your staff, over time people can sense you've mastered the game and will start watching to see if you are using machinations to optimize ratings. 

With this in mind, it's especially critical to pay attention to your own brand:

  • as a "tough grader" if you are giving ratings
  • as a "relentless pursuer of excellence who is self accountable" in regards to your own rating

Achieve true expertise in the expectations game by looking for opportunities to constantly push the bar higher — true mastery arrives only when the bar is continuously rising and you continue to exceed it.