The right Performance Review process for your startup

Why is Performance Review important?

The company grows only when the team grows. It's really important for all the team members to regularly take a step back and evaluate where they are headed, personally and professionally, and course correct, wherever required. It's also a means for you to reiterate to the team which all traits are important for anyone to succeed within the company.

One of the best books on the topic is Mindset by Dr. Carol S Dweck, where she talks about the importance of having a "Growth Mindset" vs a "Fixed Mindset". Another big proponent of this thought is Ray Dalio, who speaks about being radically open-minded in his book Principles. Here are short summaries of Mindset and Principles for your reading pleasure.

How to design the right process for your startup?

Start with what you want to achieve via the process and the constraints of your organisation.

Objectives:

• Do you want to do it genuinely for the employee's benefit or for the company's? Obviously the former drives the latter, but the converse is not necessarily true

• Do you want to be transparent?

• Do you want to optimise for avoiding politics or are you fine with what happens in most companies?

• Do you want anonymity or openness?

• Do you want to make it an employee-led or company-led process?

• The entire company gets stressed during the months of the feedback cycle. Are you fine with that or want to put in the effort to minimise that?

Constraints:

• Org structure: does your business have a lot of hierarchy levels?

• Quality of talent: is there homogeneous talent or diverse? Are most people self-motivated people or those who need constant direction?

• Do you follow OKRs / similar goal setting and tracking mechanism?

• Salary increment budget: are you comfortable with some flexibility (+/- 2%) or can not let it shoot at all?

• Are there different categories of people for whom the performance review process must be different?

There is no single golden solution that works for every startup. Based on the org's objectives and constraints, we try to get creative and come up with the best solution for them.

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We believe the Performance Review process is one of the most important org processes which help the people and the company grow together, in an aligned manner. We would love to help you design the most suited Performance Review mechanism for your startup. Please feel free to reach out to us or explore the Services we offer.