Ask any HR expert and they'll tell you the performance review process has two main goals — employee accountability and employee development. But that's not the whole story. A truly great performance review strategy will also drive inclusion.
Inclusion and performance go hand in hand. In fact, experts like Bernadette Dillon, Inclusion Specialist and Director at Deloitte, report that companies with an inclusive culture are “twice as likely to meet or exceed financial targets” and eight times more likely “to achieve better business outcomes.”
Performance reviews have a fairness problem
Fairness is fundamental to a diverse and inclusive company culture, yet according to Gallup, only 29% of employees strongly agree that their performance reviews were fair.
And it only gets worse once you start digging deeper into the data. For example, one study found that African Americans and women were less likely to get good ratings, and that ratings were more favorable for people that shared the same race as the rater.
Another survey found that 41% of African American women managers felt they needed to outperform their male counterparts in order to help offset bias in the review process. Unfortunately, that’s just the tip of the iceberg on the well-documented problem with performance reviews and diversity.
How can a fair performance review process help rewire your company culture
Despite their unfortunate track record, performance reviews don't have to be a barrier to diversity and inclusion. In fact, they can be an essential tool to help you create the kind of company culture that embraces diversity in a real, practical and performance-driven way.
When launching into a new diversity and inclusion initiative, experts often talk about the need to "rewire" your systems, so that you can rewire your behaviors. Well-designed performance reviews help you do just that.
With the right tools and questions, your performance review system can help you discover and eliminate bias in managers, workflows and talent management processes, and even help you collect data on diversity and inclusion measures that you may not have otherwise known where to find or how to track.
And of course, by focusing on clear and tangible goals, performance reviews can be a great way to get an objective view of each individual contributor on your team, while naturally creating a regular time and place to acknowledge the unique skills they bring to the table.
Performance reviews can improve diversity and inclusion, IF they’re done right
Handling biases is tricky business and you'll need to be very intentional about how you design your performance review system to help weed bias out of your organization. Whether based on race, gender, or other unconscious prejudices, our biases don’t always sit on the surface. According to bias-reduction trainer Sondra Thiederman, “bias is an attitude” — it can be tough to spot from the outside.
A great way to start checking for biases on a deeper level is to simply be aware of what they are and how they can manifest in the workplace. Here's a list of some of the most common performance management biases from the experts at Diversity Best Practices.
- Availability/Recency Bias: The most recent, or most memorable moment crowds out the rest. This bias slants a review to one or two big moments and makes it much less holistic.
- Halo and Horn Bias: Like an availability bias, this bias comes from a good or bad first impression we let come before the whole picture of a person’s performance.
- Confirmation Bias: When we unknowingly focus on the evidence that supports our worldview and ignore evidence that counters it. Sweeping generalizations like “bad employees have disorganized desks” can come from confirmation bias.
- Affinity Bias: We see people like us in a more positive light and it seeps into how we judge their performance.
- Implicit Stereotyping: Our preconceived notions change how we see someone’s performance. Racism, sexism, ableism, and other 'isms' all come into play here.
Set up your performance review system with the goal of rooting out these biases as much as possible. Make it known to your teams that the system was designed (or revamped) with the goal of supporting the company's vision for diversity and inclusion and help them understand why it's important to the bigger picture.
You can also help your managers learn to spot their own biases by hiring a professional to come in and workshop with your teams. Tests like Harvard University’s Implicit Association Test (IAT) can also help you and your team leaders identify your own biases in a way that's more private and personalized. Remember, this is a challenging subject for almost everyone. If you're using tests like the IAT, make sure you allow each member of the team to keep their results confidential so that no one feels shamed, blamed or singled out.
Your performance management system can be a catalyst in creating a more diverse and inclusive culture, but it isn’t the end point. A winning diversity and inclusion strategy is one that never reaches a finish line. It's a continual process of evaluating and handling our own biases and it requires a constant re-commitment to stepping up and doing what's right for our people and our business.