Abolish Annual Reviews

It's that time of the year again for many people: the annual review. The corporate motivation behind this often frustrating and time-consuming process, is presumably to reduce the level of subjectivity in the evaluation of employee performance. Whereas in the past, your manager may have used his or her own criteria to determine salary increases, the annual review now ensures that there is a system, with objective rules, substituted in place of such independent judgement.

Unfortunately, such systems tend to have a number of detrimental effects. Firstly, it is common for such systems to place the onus on the employee to demonstrate the degree to which they have satisfied certain performance criteria. The effect of this is to favour those prone to self-promotion, and to discriminate against those of a more humble nature. Secondly, annual reviews often revolve around a list of specified objectives, which were determined at the beginning of the annual review year. The consequence of this is that, during the year, employees tend to focus only on their specified objectives, and often prove reluctant to provide assistance to their peers on matters not covered by those objectives. Thirdly, because the onus is on the employee to demonstrate competence and performance, those managers of a more lazy disposition will often take a less active interest in judging an employee's performance and ability during the course of the year.

Does this represent a net gain over the pre-annual review world? I'm not sure that it does.

Table for two?

Richard Williams reveals that the two most interesting people of 2007, Max Mosley and Ron Dennis, recently had dinner together at the Poissonnerie de l'Avenue, a seafood restaurant "a stone's throw from the president of the FIA's Knightsbridge pad."

Presumably Ron had the turbot.

"I had him to a little dinner at that table," Mosley volunteered...pointing across the restaurant, "and I said, 'Ron, you've won the world championship, you're very rich, you've got a lovely wife and family, you've got everything that anybody could want - and yet you can't relax and enjoy it. Just chill out.' But he can't. And probably that's one of the reasons why he's successful."

Of course, in suggesting that Ron should 'relax and enjoy it', Max wanted to suggest that Ron should retire from the helm of McLaren. Perhaps, then, the conversation proceded as follows, with Dennis answering:

"I will, when the time is appropriate, when doing so would be in the interests of McLaren, and not necessarily in my own interests or the interests of those who seek to damage McLaren, implement a successful and transparent transfer of responsibility within the McLaren organisation."

The right-corner of Ron's mouth curled upwards as he paused, glancing briefly out the window, before turning to fix his gaze on Mosley once more. "I trust, Max, that as the President of the international automobile federation, you will also appreciate the importance of long-term planning, and you will also be in the advanced stages of preparing your own succession plan. I trust that, just as Martin Whitmarsh is already my anointed successor within the McLaren organisation, you are also able to inform me of the name of your anointed successor?"

"Oh come on, Ron!" Max poured himself some more wine, and tipped the bottle towards the glass of his dining partner. Ron flicked out his fingers to refuse the offer, but kept his eyes fixed on Mosley. "One of the advantages of the FIA," continued Mosley, "is that it's a democratic institution, unlike an ephemeral trading company such as McLaren. I simply couldn't name my successor, even if I wanted to. And besides, I'm enjoying this. Why would I want to retire now, in my prime?"

Ron mulled this over in silence for a moment, delicately rotating the wine glass between his thumb and fingers. "As democratic institutions go, I would say that the FIA often seems to act in a manner which cannot easily be perceived to be consistent with the exercise of democratic principle. Given the number of global international business stakeholders in Formula 1, Max, and the amount of money they have invested in the sport, it would, I think, be to the benefit of all those stakeholders if they could perceive that there is a plan in place which offers the prospect of a new transparency and impartiality to the mechanics by which the FIA governs the sport."

"Dear old Ron, I would say that from the evidence of this last year, the lack of transparency within McLaren needs addressing with somewhat greater priority."

And so, perhaps, it went.

Why are men on top?

Helena Cronin makes an interesting point about the statistics of male and female ability. Whilst mean ability is approximately the same amongst men and women, the variance in male ability is considerably greater than the variance in female ability. As a consequence of this, the highest achievers tend to be male, and the lowest achievers tend to be male also.

Cronin points out that "discussions standardly zoom in on the means and blithely ignore the tails. So sex differences are judged to be small. And thus it seems that there's a gaping discrepancy: if women are as good on average as men, why are men overwhelmingly at the top? The answer must be systematic unfairness — bias and barriers. Therefore, so the argument runs, it is to bias and barriers that policy should be directed. And so the results of straightforward facts of statistical distribution get treated as political problems — as 'evidence' of bias and barriers that keep women back and sweep men to the top. (Though how this explains the men at the bottom is an unacknowledged mystery.)"