In 2012, our business was going through a transformation as we moved from selling boxed software on an 18-to-24-month development cycle to a subscription model that required much more frequent software updates. It was a massive change that required a new agility from all our employees, and it caused a lot of internal turmoil.
Donna Morris, our then Senior Vice President of People Resources, realized that her organization could lead the cultural shift by rethinking its own processes. By changing its approach to employee growth and development, her team could help employees keep pace with the changes in our business.
Donna felt that the annual performance review process was an obvious candidate for reinvention. It was stale and bureaucratic; it took valuable time away from our people when they needed to be tackling tough business issues; and its stack-rankings and performance labels led to anxiety and frustration, sapping employees’ motivation and energy at a time when we needed them to feel inspired and driven to innovate.
Ultimately, we decided to throw out annual performance reviews and create something new. Donna and team asked for feedback from all employees and, after many iterations and lots of work from people at all levels of the company, "Check-in" – our brand for this new approach – was born. There was no annual performance review in January 2013, and there haven't been any since.
What were the key principles of Adobe’s Check-in process?
We wanted the process to be simple and lightweight. We wanted it to be flexible, both in terms of timing and approaches to Check-in conversations. We wanted both employees and managers to feel empowered to fully participate in the conversations. We wanted managers to take ownership of performance, rather than having our then People Resources organization act as a watchdog, and we expected them to engage actively in the process. And finally, because Check-in represented such a big change from the standard performance review process, we started out with the understanding that it would take two to three years for us to get it running smoothly and successfully.
What are the advantages of Check-in for Adobe?
We’ve seen positive results so far. It’s clear to us that, by having multiple Check-in conversations each year, both managers and employees are able to act more quickly when performance expectations aren’t being met.
We've also redeployed the time managers spent administering the annual review process to more impactful Check-in conversations and important business priorities. In the first year of Check-in, we estimate that we saved 80,000 manager hours, the equivalent of 40 full-time employees. With headcount growth since then, we estimate that we now save more than 100,000 manager hours each year. And according to our annual employee surveys, we've seen a 10% increase in the number of employees who say they'd recommend Adobe as a great place to work, a 10% increase in the number who say they receive ongoing feedback that helps their performance, and a 5% increase in the number who say their managers are open to receiving feedback from them.
We’ve even seen advantages in our recruiting efforts. We highlight Check-in when pursuing candidates who work for companies that have standard annual performance reviews, and we’ve found that eight out of ten of our new hires have discussed Check-in as a key tenet of our culture before their first day on the job.
What are the primary challenges of Check-in?
Getting started wasn’t easy. The biggest challenge for us involved creating a new mindset among our managers. We invested heavily in change management to help them take ownership of the Check-in process. We wanted them to create an experience in which their direct reports would welcome ongoing feedback, act upon it, and offer their own ideas for their personal growth and development.
We also had to build our managers' skillsets around compensation planning for our annual Rewards Check-in process. Without traditional reviews and fixed guidelines to steer their decisions, managers needed to be trained to differentiate pay based on employee performance and market conditions.
Another big challenge was that we had to navigate a diverse global landscape, since different countries and cultures have unique requirements around performance processes.
How can I know if a lightweight performance review approach like Check-in is right for my organization?
It depends on a number of factors. At Adobe, those factors included the readiness of our organization for change; our ability to make a business case for the change; our ability to secure executive support to help design a program that served the business; the reputation of our then People Resources organization to drive such a significant change and influence adoption company-wide; and the ability of our managers to have effective conversations with their direct reports.
What factors have been critical in making Check-in a success at Adobe?
These are the top five lessons we’ve learned in developing the program and making it work for our employees and our company:
We've partnered closely with our executive team. Check-in needs to be role-modeled from the top.
We've made big investments in our managers' capabilities and development.
We've communicated early and often. We engaged employees in a dialogue before we made the move and we've communicating progress regularly.
We've built a centralized Employee Resource Center that has helped us scale the program.
We've taken global differences into account, working with legal entities like regional work councils and vetting any concerns early.
What type of training and communications plan does Adobe recommend?
When we first launched Check-in, we designed a comprehensive plan that included significant training and communications for the first 18 months, with continued training after that time. We rolled out the training to our senior leaders first, followed by managers and then employees. We started with one phase of Check-in (Feedback), and then each quarter we’d focus on another phase.
Most of our training involves short bursts of learning either in person or via Adobe Connect, our web-conferencing platform. For example, in a 60-minute session, we share the concept, a framework, and key tips, and then we have a panel of employees demonstrate how the practice works within a team.
We’ve also invested in an Employee Resource Center that offers templates, guidelines, and videos designed to help managers and employees build their skills around both providing and using constructive feedback as a development tool.
We’ve woven Check-in throughout our programs. Our recruiters and managers talk about it with candidates during our selection process. New hires hear how to make the most of it during orientation. It’s embedded into our curricula for managers, our quarterly leader communications, and our all-hands meetings.
What can the manager and the employee do to ensure that their Check-in conversations are successful?
We’ve found that our managers are most successful when they set a cadence for conversations that’s based on business rhythms; determine areas of focus for their Check-ins; discuss performance specifics (i.e., what’s working and what needs to be improved); create action items with each direct report and review them regularly; and always provide timely feedback.
We’ve found that our employees are most successful when they come to the conversations prepared to discuss the following things: their progress against action items and goals set in the previous conversation; their development needs and ideas for how to grow, for example through training courses or stretch opportunities; and their long-term goals and plans for achieving them.
What’s the ideal frequency for Check-in conversations?
We’ve designed our Check-in process to allow for flexible scheduling that supports the business. Our managers and employees can work together to determine the appropriate timing of setting expectations and providing feedback on those expectations. For example, the Finance team might set expectations and give feedback at the end of the quarter since its work is tied to fiscal quarters, and an engineering team might time their Check-in conversations to coincide with its six-week development sprints. If there isn’t a clear rhythm, we recommend that managers schedule Check-ins at least once a quarter.
Given that Check-in doesn’t use employee stack rankings or ratings, how do you administer compensation?
Based on our annual budgeting cycle, bonus plan administration, and compensation plan programs, we have an annual Reward Check-in where merit raises, bonuses, and limited equity are awarded. Using a system Adobe designed internally, managers have a few weeks to provide their recommendations for merit and bonuses, and those recommendations are sent to senior leadership for review. Managers are given a budget, the salary range for each employee based on the local market, and which quartile of the salary range the employee is in. Managers then decide how to allocate compensation based on available budget, performance, business impact, and market placement. We have a “pay for performance” philosophy, and our Compensation and HR business partner teams monitor the reward recommendations to screen for any anomalies.
Does Check-in work with underperforming employees?
We’ve found that ongoing Check-in conversations help our managers quickly address any performance issues with constructive feedback. But if an issue persists, we have a structured, documented process to ensure that we’re doing our due diligence in relation to the employee and the company. When a manager tells us that a direct report is underperforming, we first ask whether the manager has been setting clear expectations and giving specific, direct feedback via the Check-in process. If not, we recommend that they start there and document those conversations. If the employee still isn’t performing after a reasonable amount of time, then we begin the structured performance improvement process.
How do you measure to determine whether Check-in is working?
We’ve used our employee engagement survey as a key tool for measuring the effectiveness of Check-in. We started with a baseline survey in the fall of 2012, and the few questions that trend show continued improvement companywide.
Another way we measure the success of Check-in is to monitor voluntary attrition, which continues to be very low for our industry. And we also monitor anecdotal feedback, which is very positive.
We’re always working to reinforce the importance of the ongoing conversations and the need for everyone to build their capabilities, especially as new people come into the company. Since we can cut our Engagement Survey data to the individual manager level and other demographics like country, business unit, and level, we can see where we have strong ambassadors/adopters and where we need to provide more support and coaching.