What you Must Do in November: Evaluate your Team

What you Must Do in November: Evaluate your Team

Posted by: Anne Kennedy & Gillian Muessig on Wednesday, November 23, 2016 at 12:00:00 am

CEO Coach Blog 2016-11-16

What you Must Do in November: Evaluate your Team

It’s November! What do start ups absolutely need to be doing this penultimate month of 2016?

Focus on the team, your employees.

In March we said the most important thing that must be done was to take a look at your team and ask the following questions:

Is everyone on the right seat on the bus? How did they perform in 2015? How much did their functions move your start up forward? Are their functions and responsibilities aligned with your 2016 goals?

Now as we approach the end of 2016, it’s time to review your employees’ performances. Again.

In a start up, it’s so easy to get caught up in keeping up with everything that needs doing, and let monitoring employee performance slide. But even if you have a small team and are still in ramen noodles mode, you must resist this temptation -- especially if you are a lean early stage start up. You have no room for any margin of error in employee performance.

In fact, evaluating employee performance management is best done ongoing, with instant feedback, according to a study in Harvard Business Review on best practices in many large corporations – IBM, Dell, Deloitte, Gap and Oppenheimer Funds. Even General Electric, famously a long time advocate for traditional annual employee appraisals.

What can we early stage start ups learn form the big companies? Lots.

 “The biggest limitation of annual reviews,” say Anna Tavis and Peter Cappelli in HBR, “is this: with their heavy emphasis on financial rewards and punishment and their end-of-year structure, they hold people accountable for past behaviors at the expense of improving current performance.” This is precisely why a start up needs to adopt a real-time feedback method for your team – time. Your start up doesn’t have time to wait a year to find out if someone is underperforming. You may not still be in business by then.

Moreover, startups need to be agile. You may be moving people around to meet your business needs as they develop, so it makes little sense to evaluate employees once a year according to last year’s responsibilities.  Even giant GE has realized this, according to Susan Peters, head of HR there.

Another contributing factor is the need for teamwork – and what startup doesn’t rely on teamwork? You are much better off, and so is your startup, if you keep track of whether your employees are meeting their short term goals – say, quarterly – and delivering feedback quickly. This is a system, say the HBR writers, that more naturally follows the cycle of work. Managers and employees have natural conversation points when ‘projects finish, milestones are reached, challenges pop –up.” Sound like life in your startup?

The point is to give feedback and provide rewards anytime it’s warranted. And guess what? There are apps for that. Performance Development Apps provide places to store notes form conversations, and then call them up and summarize them. One at IBM lets employees give feedback to peers and cc the boss, if they choose.

In a discussion of how to retain employees, First Round Review says “If we do our jobs as leaders, a performance review should have two columns – A for what you do great, and B for what you do not so great.  That certainly simplifies things, doesn’t it? This comes from Carly Guthrie, veteran of tech HR. And it makes perfect sense. And takes a lot less of your time heading up your start up.

It also informs your culture. Making on the spot performance appraisals frequently, bespeaks transparency and accountability and honesty, highly desirable characteristics of a healthy company culture, that employees are more likely to want to stay in.

This applies to mentorship, too. Instant feedback that flows back and forth freely will improve performance when you need it. “Good mentors have a very clear sense of what you’re supposed to be accomplishing and won’t wait to give you feedback.”

“Startups could benefit from using mentorship as an opportunity to shorten their own feed back cycles, without making people nervous about their performance.”

Guthrie also recommends bringing in professional HR as early as you can. Not so much a nice to have, but an important role to fill with someone you can trust with “The deepest darkest secrets of your organization.” Further the single most important thing a good HR manager can do for start up is to train managers to handle HR questions and issues, which is critical. to your being able to scale.

That, and providing a sounding board are good reasons to bringing HR into your organization earlier, rather than later. Gillian, what have you seen in the many startups you’ve mentored? When can an early stage company reasonable expect to bring on and HR professional?

Top tips

  1. Face up to appraising your employees’ performance and make it happen regularly
  2. Provide instant feedback and rewards as work is accomplished, rather than waiting for an annual review
  3. Get HR on board early.

 

 

Based on a CEO Coach podcast broadcast on Cranberry.fm November 14, 2016

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