The traditional performance review is frozen in time. Its design is outdated and its implementation is typically mediocre. Unless you fix it, your company itself will perform (as the review itself might say) “below expectations.”

Problems with the traditional review are serious and structural. There is no quick fix. As we will see, there are culture-killing flaws embedded in the traditional review system’s design. Improving execution of a broken practice won’t eradicate the problems, for the pathology has already been strengthened by decades of repetition.

In theory, a performance review rewards good performance and stimulates underperforming employees to improve. This is supposed to create a cycle of ever-improving work performance ...

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