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How IBM revamped its performance management system

Image of billboard showing the words Rethink.

For the last 10 years, tech­nol­o­gy giant IBM has been oper­at­ing an annu­al-based per­for­mance review process that will be famil­iar to most organ­i­sa­tions — set­ting of objec­tives in Jan­u­ary, an inter­im review mid-way through the year and then an appraisal meet­ing in Decem­ber cul­mi­nat­ing in a sin­gle per­for­mance score.

Last year it decid­ed to fol­low in the foot­steps of many oth­er well known organ­i­sa­tions such as Microsoft, Accen­ture and Gen­er­al Elec­tric and under­take a com­plete over­haul of its per­for­mance man­age­ment sys­tem. That revamp is now com­plete and its new sys­tem called Check­point” has just gone live.

Like most oth­er organ­i­sa­tions who have moved away from an annu­al approach, IBM’s new per­for­mance man­age­ment process involves set­ting short­er term objec­tives and get­ting reg­u­lar feed­back through­out the year.

In an inter­view with For­tune Mag­a­zine, Diane Gher­son, IBM’s Chief Human Resources Offi­cer said that dur­ing the year, new things would come along” mean­ing that employ­ees would often no longer be work­ing towards their orig­i­nal annu­al objec­tives. Yet they would end up in an irrel­e­vant dis­cus­sion” in Decem­ber try­ing to assess whether they’d achieved those goals they’d cre­at­ed 11 months earlier.

When decid­ing what to do dif­fer­ent­ly, IBM took a nov­el approach and inter­nal­ly crowd­sourced feed­back from its 360,000 employ­ees. They received 2,000 respons­es from which the con­clu­sion was that employ­ees want­ed more fre­quent feed­back. They also didn’t want a sin­gle per­for­mance rat­ing with rel­a­tive rank­ings, nor did they want a self-assess­ment process.

So IBM’s new process ensures that employ­ees get feed­back at least every quar­ter. They have also dropped their sin­gle per­for­mance score and replaced it with an assess­ment against five cri­te­ria — busi­ness results, impact on client suc­cess, inno­va­tion, per­son­al respon­si­bil­i­ty to oth­ers, and skills. In the old sys­tem, there was one score. Peo­ple [got] sort of obsessed by that,” Gher­son said. In the new sys­tem, there are five scores. It leads to a much rich­er, more bal­anced discussion.”

Being a large tech­nol­o­gy com­pa­ny, IBM built its own app to help facil­i­tate its new Check­point” process. How­ev­er, most organ­i­sa­tions don’t have vast in-house tech­ni­cal resources like IBM and most per­for­mance man­age­ment sys­tems are still based around an annu­al cycle. That’s why we built our Clear Review app. Now any organ­i­sa­tion can move to a year-round approach to per­for­mance man­age­ment with reg­u­lar check-ins and real-time feed­back using Clear Review.

To find out how Clear Review can trans­form your per­for­mance man­age­ment, book a per­son­al demo right now via our online demo book­ing sys­tem.