Here’s one of the worst HR stories I’ve heard in a while. And it happened to a friend. Let’s call him Jerry.
Jerry works for a global financial firm. A large portion of his compensation is in the form of a bonus. This bonus is, in part, determined by the performance review he is given at the end of each year.
As a supervisor himself, Jerry is responsible for the performance reviews of 6 direct reports. Jerry’s boss, Igor, is a Managing Director who is new at the firm. And since Jerry handles most of the performance review responsibilities in the department, Igor is only responsible for one performance review. Jerry’s.
An internal deadline date of December 30th is given to management. This date is vital because it gives all reports an opportunity to discuss, challenge, accept or decline their performance appraisals and goals. Once the reports are acknowledged by employees, the bonuses are determined and everything is “baked” into the system.
Jerry completes his 6 performance reviews on time. Igor, who has been busy “managing up” (and shaking things up) makes excuses for delaying Jerry’s review. Jerry is anxious and excited for his review because of the many measurable accomplishments he achieved in the prior year. Although Igor was not with the firm at the time of most of these accomplishments, Jerry provided a list of accomplishments and has been vocal about his achievements. He is expecting a great review and/or a promotion. His bonus is riding on it.
Days turn into weeks. And Jerry’s review is pushed off. Jerry urges Igor (as delicately as possible) to respect the process and complete his review. Igor tells Jerry that HR gave him an extension to complete his review. Bottom line: Igor finally gives Jerry his review — the day before bonuses are announced! What’s worse, the review is negative!
Igor overlooked all of Jerry’s accomplishments and focused on one minor error that Jerry recently made. It is evident that Igor put no time or effort into Jerry’s review. Jerry is shocked! He and Igor have a long, heated conversation about the rating — Igor acknowledges his oversights and attempts to make an upward adjustment to Jerry’s rating in the system. He can’t. It’s too late. The internal deadline date has passed and changes can no longer be accepted. Jerry’s rating is wrong … his bonus is affected…his reputation is damaged … his future with the firm is now in question.
Jerry, who has a great reputation with all of his colleagues, has always received good performance evaluations and has a paper trail outlining the situation, goes on a one-man crusade to right this wrong. He files a complaint with HR, and then goes to executive management with his woes. He is angry, upset, worried and mortified…
Who allowed this to happen? Why weren’t the necessary guidelines followed? What sort of HR professional would EVER allow a performance review to be done at the 11th hour? Was the HR manager just trying to placate a strong-willed executive? And how did this new Managing Director even get hired when he clearly has no regard for the value or understanding of the most vital of management tools?
Does the HR department of one of the world’s largest financial institutions even realize that a botched review processes can lead to employee turnover, low morale and potential legal trouble? Do they understand the harm that can be done to their brand if a story like this gets out?
CONSIDER THIS A WAKE UP ALL FOR CALL HR FOLKS! You say you WANT to be respected as decisive, strategic and added-value but to do so you must realize that you do not work for the executives — you work for the company. HR nightmares like this happen ALL the time in corporate America. HR simply must adhere to the processes that are put in place. HR must advocate for employees. HR people must be strong and have the b***s to stand up to the powers that be. The lives and careers of employees depend on this!
My opinion: Igor is an accomplice in this abomination. But executive leadership and HR are ultimately to blame. What do you think?
AFTERWORD: After much wrangling, Jerry’s rating was manually upgraded in the system. However, as of now his bonus will be paid based on the original, erroneous rating. Jerry, an engaged, productive and loyal employee, is currently looking for a new opportunity.
I agree that HR is at fault. It also sounds like the irresponsible manager felt there were more “important” things to do than the review. Either way, it is arrogance. Thinking that employees do not deserve/are not entitled to be treated with respect is a common complaint heard in corporate America these days. Culture change begins at the top. Hopefully someone up at the top will hear about this and do something about it.
I disagree that HR is at fault here. First of all, these types of bureaucratic (and easily botched) HR processes are, at best, defective even under the best of circumstances. There are more effective approaches to providing employee feedback than traditional performance review systems. Second, I agree with Rikki that culture change and support for the organization’s processes must begin at the top. HR can’t “make” anyone do anything. In most organizations, HR also doesn’t have the authority to hire/fire/discipline individuals other than their own direct reports. Responsibility without authority doesn’t work. HR’s responsibility is to monitor the process and timely escalate issues, but ultimately HR usually doesn’t have the ultimate authority enforce it. If the process is not supported at the top, then HR should be looking for alternatives, if any, that those at the top and managers, *will* support. Except for illegal or unethical activities, I don’t think it’s realistic to expect HR professionals to go toe-to-toe with the rest of the organization and put their job on the line for a process that is ineffective in 98% of organizations, anyway (according to a SHRM survey).
HR is not at fault (and it’s not because I’m an HR apologist). Things get done only if they are measured. It appears that Igor’s objectives (given by his management) did not include – employee development, etc. So, Igor was essentially ‘told’ that employees can be overlooked. HR should have shouted loudly. (We don’t know that they didn’t, and were also overlooked.) The fault, dear colleagues, is with the management group. They set and demonstrate the culture by rewarding what they consider important. By their behavior, they have announced that to the rest of the company. HR could have done a better job influencing the outcome, but it didn’t start there.
Thank you for your opinions. I do think Igor was definitely wrong to disregard the process and his employee. However, HR disregarded the process as well. I have seen amazing, strategic HR professionals at higher levels make great strides because they are willing to communicate with executives to coach them on corporate culture, best practices, etc. If we do not inform or try to influence management – HR is not providing value. If we are not able to influence or at least try to make changes, then we are not strategic.
I think there were several issues with this. Although not entirely at fault, HR clearly has a stake in this. HR should have some way of knowing, since the ratings are automated, who has completed the reviews and who hasn’t. HR should have at the least informed Igor’s boss that his reviews have not been completed. Since Igor was so busy ‘managing up’, this should get his attention. This entire process as described has forcfed Jerry into an uncomfortable sitaution. Sit back and take it makes him look weak and he loses out. Protesting to everyone he should makes him seem like he is not a team player, even if he is in the right. He is left with the option of getting antoehr job and appears to be taking it. Reminds me of a terrible situation I obsereved once where a ‘+’ that did not exist was added to the ‘average’ performance rating score and the people who received it were told they could not receive the ‘above average’ rating because they were not doing the next higher level of their job family, even though it was not stated anywhere in their goals. Sound familiar? The manager giving these reviews was in HR and HR did nothing about these ‘+’ when they were made aware. The importance of performance reviews are undervalued. They seem to be a nuisance to managers of lesser ability to have to do them, but all they have to do is mess it up and their employee will be looking for work elsewhere. This is avaluable opportunity to reward a good employee or take corrective action for one that needs improvement. HR needs to reinforce this concept with all those who do performance reviews.
Accountability rides with the manager who albeit is new; has the responsibility to perform a review for his/hers direct reports.
For many of us like Jerry bonus payments are a critical part of our annual compensation and an on-time process is critical. I think HR folks often get a bad rap and get called in when the manager/direct report situation is at a point of no return. Perhaps Jerry could have engaged HR when it looked like the review would miss the deadline?
While I think HR could have monitored the “outstanding” review, and generate the required e-mail follow ups etc, thus holding the managers’ feet to the fire- you clearly have a disconnected manager who needed to perform the required review.
Thinking about Jerry; getting a poor review is bad enough, getting it late is insult to injury.
Jerry’s manager’s manager is clearly at fault. Would HR have been responsible if there was a securities breach just because the recruiting process hired the guy who did it?
This is a shared responsibility and once again the process only works as an end to end solution from the leader down. Igor’s boss and HR should have signaled the culture, process, expectations and responsibilities from the beginning and then actually “managed as leaders”-both have a strategic and tactical responsibility to the company to manage the business and lead the people in a successful partnership, executing with excellence.
Here’s a good example of “lose/lose” instead of “win/win”-the message goes beyond this case to every observer in and outside the company and has a dramatic effect on engagement.
As an aside, there’s always a way around the “strict process” process when executing on annual compensation-a lump sum,stock grant, ,interim increase,etc.-wonder if Igor’s boss noticed when he executed for his own direct reports? Hmmmm-lots to consider here.