Why Adobe Ditched Its Annual Performance Reviews

by Srikant Chellappa Dec 13,2018

The People Strategy Leaders Podcast

with Srikant Chellappa, CEO

In HR circles, it’s common knowledge as to why Adobe ditched it’s annual performance reviews. The general consensus is that Adobe let them go because they were ineffective, time-consuming and not to mention, complex.

The whole pushback against the performance review process also stems from the fact that they consume so much time, but give us so little in return. And to be fair, annual reviews can be ineffective, time-consuming and complex. The performance management process is capable of being so much and yet tends to get mired in a whole lot of drudgery. But that’s another discussion for another day.

Adobe didn’t just ditch annual performance reviews because they weren’t working. Annual reviews got the boot because while Adobe was forging ahead, annual reviews were plodding along. It’s not that they didn’t want to measure performance anymore. They did want to measure performance and they want to measure performance even now. But the most important thing to remember is that they wanted a better form of performance management.

Also read: Organizations That Redefined Their Performance Management Systems

A better, more inclusive way of measuring performance, not just a review that ate up time and came around once in a year.

The method that Adobe eventually adopted is the Check-In process. Unlike the performance review, the check-in was more frequent, less formal and more importantly, engaged both and managers and employees.

The reasoning as to why Adobe chose the check-in process is entirely evident when you see the process comparison that Adobe has on its website. Before Adobe ditched performance reviews, here is how a typical year would pass.

  • Employees would set job priorities at the beginning of the year, only to not revisit them during the duration of the year.
  • The entirety of the review process was managed by the HR managers, including the dissemination of coaching and resources, which meant that often enough, they couldn’t interact with everyone.
  • Though feedback was meticulously solicited and compiled, with employees submitting their own accomplishments, the amount of feedback shared was just not enough, and more importantly, it was not monitored.
  • Once all of this was done, employees were rated and ranked in order to determine compensation and promotional decisions.

One of the statistics that may have given Donna Morris pause was that often during the end of the performance review period, there was a spike in productivity and when the process was over, there was a spike in attrition rates. Employees to had to figure out how to work within the system and when despite their efforts it didn’t work, they chose to leave. It is no wonder that when she mentioned wanting to abolish performance reviews in an interview, she actually went through with the plan, despite it being a completely unconscious utterance.

In retrospect, the die had already been cast. It was just a matter of getting everybody else on board, which in Morris’s case mainly the senior leadership at Adobe.

The decision to implement the check-in process took into account all of the failings of the annual performance review process in order to create a process that would better the needs of Adobe.

When compared to the annual performance reviews process, here is what the new check-in process did better.

  • Employees discussed their priorities with their managers and regularly updated them. The conversations between them became an ongoing process of feedback and dialogue, but without the stiffness and formality of annual performance reviews.
  • An important change was getting rid of the stacked ranking. Stack rankings have been proven to disrupt employee morale, destroy teamwork and in general, are not a very good performance review process.
  • Additionally, a centralized Employee Resource Center was set up so that it could provide help and answers to employees whenever they needed it, instead of placing the onus of research and coaching on HR managers alone.

What did Adobe learn from implementing Check-Ins?

Perhaps the most important thing Adobe learned from implementing check-ins was the amount of manpower they saved by doing away with annual performance reviews. By eliminating the annual review process, Adobe also saved 80,000 manpower hours.

Additionally, it also helped them take a long, hard look at their performance process. Accepting that what you are doing is wrong, and is actually hurting your organization is not an easy thing to do. Implementing a check-in process only came about after Adobe engaged in some serious self-reflection.

And while this is more of a general lesson, Adobe’s work didn’t stop once they decided to use a check-in process. They put further effort into ensuring that this process would be more effective than annual performance reviews.

Perhaps the most important thing Adobe has learned (and this is something other organizations can benefit from too) is that changing a process is not the end, but rather the beginning.

It can be best summed by Morris’ blog post on the change, Lessons Learned with Check-in.

“Like most change initiatives this is a journey and not a destination.  As our journey continues, we are focusing on our key learnings to continue to enrich the Check-in approach and use it as a foundation for fostering employee growth, leadership, and talent development.”

If you are interested in knowing how Engagedly deals with performance management, request a demo to find out!

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Srikant Chellappa
CEO & Co-Founder of Engagedly

Srikant Chellappa is the Co-Founder and CEO at Engagedly and is a passionate entrepreneur and people leader. He is an author, producer/director of 6 feature films, a music album with his band Manchester Underground, and is the host of The People Strategy Leaders Podcast. He is currently working on his next book, Ikigai at the Workplace, which is slated for release in the fall of 2024.

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