Taking Performance to a Higher Altitude

The merger between United and Continental Airlines two years ago offered the newly combined HR department the opportunity to rethink how the company would conduct its yearly performance reviews. HR leaders wanted to identify the major challenges with each company’s process and come up with a solution that allowed its leaders to make the most informed performance decisions.

After months of discussions with company leaders, United unveiled a new performance review process in July with one major difference: Leaders could no longer come to calibration sessions with pre-populated performance ratings.

“Everyone was so used to advocating for their own teams,” said Dana Kurek, HR manager of performance management at United. “We ended up creating an environment in the room where we had one leader advocating over another and whoever could get the most ratings for their team went home as the winner at the end of the day.”

The airline is in the midst of conducting year-end performance reviews under the new process for all of its corporate and clerical employees, which amounts to about 12,000 of United’s more than 85,000 employees. Now, leaders enter the calibration sessions and are guided by the facilitating HR professional to outline the benchmarks of what United calls “valued performance,” the meets-standards metric of the airline’s performance review process. United has a four-tier system to evaluate performance: did not fully meet performance expectations, valued performance, exceeds performance and outstanding performance.

“It’s our job in HR to get them to a place where we really build up that valued list and make the leaders see that a valued performer is a fantastic rating,” Kurek said.

Then, leaders start to talk about individual performance. But before the leaders can talk about their direct reports, they are instructed to identify individuals on other teams who are being calibrated at the same time who displayed distinguished performance in the past year.

Kurek said encouraging leaders to talk about employees on other teams was HR’s “a-ha moment” in revamping the performance review process. While Kurek and her colleagues in HR faced their fair share of skepticism about the idea that leaders knew enough about members of other teams to adequately judge and praise their efforts, she said performance reviews conducted in the past few months show that leaders are paying attention to more than just their direct reports.

The third step of the new performance review process is when leaders reflect on what has already been said by others about their direct reports, and then have the opportunity to highlight any other individuals they feel have been overlooked in the discussions of employees who showed distinguished performance.

Another important caveat of the new performance review process: No employee’s rating can be moved down during the calibration session. In the past, individuals could have their rating moved down in an effort to meet the company’s distribution curve, said Cindy Seffair, director of performance management at United. Now, there is a distribution target, but that is flexible to allow performance to be accurately gauged based upon the standard leaders set at the beginning of the calibration meeting.

If HR leaders are looking to rethink their company’s performance review process, Seffair and Kurek said it’s important to start the process early.

United unveiled the new process in July and made the tools and resources, including a video of a mock calibration, available early. Then, HR started facilitating calibration sessions in September. The HR staff facilitating the calibration also spent time at the beginning of each session outlining the new program’s philosophical background and goals for the future, Saffair said.

“We found leaders were eager for HR to come in, facilitate and use the knowledge we have to help them make these performance decisions,” Kurek said.

Annual reviews don’t need to be a source of dread for managers and employees alike. With the right tools and procedures in place, performance reviews can be a process that emphasizes and informs managers of the positive contributions of their top performers.

Jeffrey Cattel is an editorial intern at Talent Management magazine. He can be reached at editor@talentmgt.com.