Mitigating bias in performance management

Performance management is a set of processes that feeds into an organisation’s talent pipeline. Traditionally, performance management processes are a two-phased approach, with an initial performance review commonly taking place mid-yearly and a final review taking place at the year-end, with the subsequent allocation of an overall ranking. The more “contemporary” approach includes regular interim feedback sessions, often referred to as “check ins” followed by one final review at the end of the year.

A key component of a performance management process often involves the allocation of a “tangible” ranking (usually in the form of a numerical value against a Likert scale system) to a team member. Some organisations also implement a self-review process, in order to allow employees the opportunity to identify and list their achievements, strengths and areas of improvement. These two processes are usually concluded via a face-to-face verbal feedback session, often referred to as the performance conversation.

Some organisations integrate a calibration exercise within their performance management process, where the rankings allocated by managers to their team members are often discussed and agreed to, usually in the presence of an HR professional. During such calibration processes, one of the key challenges that HR team members might face (and to a certain extent pro-actively notice) is the presence of bias in the ranking process. This presents a major challenge for any HR team member, and could lead to the dilemma of whether or not to contest a ranking with the respective manager.

Surprised? You shouldn’t be! Several behavioural, social and neurological studies show that humans are biologically inclined to be biased, but this does not mean that HR as a function should accept this as a fait accompli! Although biases themselves are often unconscious and not necessarily always ‘good’ or ‘bad,’ they can affect decision-making processes, often resulting in decisions that are unfair and irrational. This can lead to discrimination in the workplace, limited innovation and a negative brand perception, among others. In the area of performance management, biases can cause inconsistencies in goal difficulty, evaluation, feedback, coaching, development opportunities and rewards. Given the negative impact of personal bias in the workplace, organisations should not just accept bias as a natural human phenomenon; they need to make an effort proactively and intentionally to mitigate bias before it affects work processes. Unconscious bias requires conscious action!

If you would like to read further into this, you may download our report on mitigating bias in performance management. It explains in depth how bias can hinder performance and why it must be addressed. It also proposes a threefold approach to mitigate bias in performance management.

How Deloitte can help

The solution to mitigating bias in performance management systems lies within a strategy called “training”, an area that often; due to various reasons, is neglected and utilised solely in a reactive mode, rather than in a proactive one. Training on how to conduct performance management reviews should be a mandatory yearly session for all managers that are involved in performance management reviews. Strategies on how to mitigate bias should also be a crucial component within such workshops.

If you would like to learn more about developing strategies, workshops and training on this subject, please contact the below.