Dirty dishes, Pareto distribution and annual reviews

Jan 31st, 2017 | By | Category: Commentary

Jeff Hough
By Jeff Hough

The dishes in my sink have been there for at least three days.  I remember the first dish I put in.  In a hurry to get to work, I thought the extra step to the dishwasher would take too much time. One dish became three as my two boys had similar thoughts during their speedy departures that morning.

One day became four and pretty soon there was nothing left to eat on so we were forced to confront the enormous pile that began so innocently.  Tuesday’s eggs require a jackhammer to loosen and Wednesday’s stroganoff wasn’t going to come off without water that made your hands look like lobsters fresh out of the pot.  So, I dug in, looking for the fastest way through the task.

As I surveyed my scalding flesh, I wondered why I didn’t just put that dish in the dishwasher on Monday, which led me to reflect on an email I’d just re-read that my employee reviews were due in three weeks.  I don’t know about you, but three weeks seemed like an eternity at that moment, so I put the next dish in the dishwasher and forgot about the employee reviews—I would get to them tomorrow at work.

The email reminder about the need to get employee reviews done came three months before and prompted me to spend quite a bit of time evaluating my team with a critical eye.  Because I had so much time to ponder my team and their evaluations, a fancy way to say I procrastinated, I decided to do evaluations as the year progressed.

Many companies require managers to use a bell curve for employee evaluations, which makes little sense to me, but I am not the one making those decisions.  The thought behind using systems like the bell curve is that it forces lazy managers to really think about what they are doing and not just rank everyone equally.

Making managers work to actually evaluate their teams is a good thing, but assuming that every team fits nicely into a standard deviation is a fallacy.  Jack Welch, former CEO of General Electric, popularized the bell curve evaluation in the 1980s.  Welch liked it because it created competition among employees and supposedly raised everyone’s performance.  Thirty-five years later the opposite appears to be true.

Companies like Microsoft and Expedia are doing away with their bell curve rating system while others, like Yahoo are experiencing HR disasters trying to implement the system.  Adobe quit doing employee reviews altogether, claiming it was an antiquated system for evaluating performance.

An alternative to the bell curve was suggested by Ernst O’Boyle and Herman Aguinis in their 2012 paper “The Best & the Rest: Revisiting The Norm and Normality of Individual Performance.” Through research, they discovered that a Pareto Distribution more accurately resembles workplace performance.

For those, who like me, aren’t familiar with the Paretian Distribution, it is a statistical term for a probability distribution that coincides with observable phenomena.  Simply put, the graphical representation resembles a curved ski slope with a long tail. The 80/20 rule stated another way, 80 percent of the work is done by 20 percent of the people, holds true in corporate America.  Before you begin congratulating yourself on being in the top of the 20 percent, a critical evaluation is necessary.

Being a top performer isn’t easy.  It means arriving early, staying late, picking up extra tasks or taking on challenging new roles.  It means more than simply showing up for work each day and doing your job. That is for the 80 percent.

Leaders in the top 20 percent can’t leave their “dirty dishes” in the sink.  They need to communicate regularly with their employees. Handing out praise and having difficult conversations when situations arise is a requirement of excellence.

A sink full of dirty dishes is not fun, nor is staring at a blank screen trying to fill out evaluations which fit team members into a pre-described distribution range.  The smart thing to do is work on evaluations as the year progresses and have conversations when they are relevant and mean something.  Take the extra step now rather than putting it off.  Your red-hands will thank you for it.

Jeff Hough is a business author, blogger and speaker in Pocatello.

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