Dive Brief:
- In a move to change its culture following sexual harassment allegations, Uber removed the standard employee ranks and ratings from its performance review process, reports Tech Crunch. Liane Hornsey, the ride-hailing company's senior VP and CHRO, told Tech Crunch she knew changes were necessary after employees expressed shock over ex-employee Susan Fowler's sexual harassment allegations and complaints about management.
- Uber formed focus groups with 600 of its employees to imagine what a different performance review process might look like. The result of those meetings is Uber's new T3 B3 process. Employees list their top three qualities or strengths and bottom three areas that need improving. T3 B3 replaced Uber's old system in which workers were numerically scored on their good and bad performance.
- Tech Crunch says the new process includes individual goals for employees and a "citizen's goal" that they fulfill by doing good deeds for others inside or outside the company.
Dive Insight:
The performance review overhaul is a major cultural shift for Uber. The company's performance management system was based on the "rank and yank" model originally popularized by legacy companies like GE. But even GE has shelved the once-a-year performance review process, as many found it to be negative and overly subjective. Many companies have opted for a collaborative review process focused on staff development and frequent feedback.
A 2016 white paper, Why Traditional Performance Management Systems Aren’t Working, describes the traditional performance review's failure as its focus on employees' past behavior rather than future capabilities. Some companies, like Facebook, have opted to retain a more traditional style review, but their system relies on a 360-degree model that pulls in peer reviews.
Such changes matter in the long-run, as even the most minor cultural changes can send big ripples through a company. Performance reviews signal what a company values in its employees — and that value signal is often where change has to begin.
