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Performance Review Takes a Page from Facebook


Employers are trying out social networking-style systems that aim to improve—and take the dread out of—annual reviews

In the world of Facebook or Twitter, people love to hear feedback about what they're up to. But sit them down for a performance review, and suddenly the experience becomes traumatic.

Now companies are taking a page from social networking sites to make the performance evaluation process more fun and useful. Accenture (ACN) has developed a Facebook-style program called Performance Multiplier in which, among other things, employees post status updates, photos, and two or three weekly goals that can be viewed by fellow staffers. Even more immediate: new software from a Toronto startup called Rypple that lets people post Twitter-length questions about their performance in exchange for anonymous feedback. Companies ranging from sandwich chain Great Harvest Bread Co. to Firefox developer Mozilla have signed on as clients.

Such initiatives upend the dreaded rite of annual reviews by making performance feedback a much more real-time and ongoing process. Stanford University management professor Robert Sutton argues that performance reviews "mostly suck" because they're conceived from the top rather than designed with employees' needs in mind. "If you have regular conversations with people, and they know where they stand, then the performance evaluation is maybe unnecessary," says Sutton.

What Rypple's and Accenture's tools do is create a process in which evaluations become dynamic—and more democratic. Rypple, for example, gives employees the chance to post brief, 140-character questions, such as "What did you think of my presentation?" or "How can I run meetings better?" The queries are e-mailed to managers, peers, or anyone else the user selects. Short anonymous responses are then aggregated and sent back, providing a quick-and-dirty 360-degree review. The basic service is free. But corporate clients can pay for a premium version that includes tech support, extra security, and analysis of which topics figure highest in employee posts. Rypple's co-founders have also launched software called TouchBase that's meant to replace the standard annual review with quick monthly surveys and discussions.

GALVANIZING GOALS

Accenture's software, which it's using internally and hoping to sell to outside clients, is more about motivating employees than it is about measuring them. With help from management guru Marcus Buckingham, the consultancy's product has a similar look and feel to other corporate social networks. The major difference is that users are expected to post brief goals for the week on their profile page, as well as a couple for each quarter. If they don't, the lack of goals is visible to their managers, who are also alerted of the omission by e-mail. By prompting people to document and adjust their goals constantly, Accenture hopes the formal discussions will improve. "You don't have to desperately recreate examples of what you've done," says Buckingham. Typically, "managers and employees are scrambling to fill [evaluation forms] out in the 24 hours before HR calls saying 'where's yours?' "

If having your performance goals posted for the world to see sounds a bit Orwellian, consider this: Rypple reports that some two-thirds of the questions posted on its service come from managers wanting feedback about business questions or their own performance. The biggest payoff of these social network-style tools may prove to be better performance by the boss.

Return to the Game-Changing Management Ideas Table of Contents

McGregor is BusinessWeek's management editor.

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