Performance Reviews

The How and Why of Performance Review Calibration

September 29, 2022
November 7, 2023
Lyssa Test
Lattice Team

Every company aims to create a performance management process that gives all employees an equal opportunity to succeed and receive valuable feedback on their work. Unfortunately, having an employee's performance rating determined solely by their manager — as is the case with many businesses ’ performance management processes — can involuntarily invite bias into reviews and disproportionately help certain individuals while disadvantaging others.

The first step to eliminating this bias is awareness. Training your managers to identify and understand their own biases and how they might crop up when evaluating their team’s performance can help, but this is still not enough to ensure your organization conducts completely objective and fair reviews. Instead, you also need your managers to be on the same page when it comes to how they determine an employee’s level of performance.

Consider this: As your HR department looks more closely at employee ratings from your most recent review cycle, you discover that employee scores varied greatly based on who was giving them. Performance is subjective, after all — how one person defines poor, good, and great performance could vary widely from how someone else who works in the same department or team or even holds the same job does. So how can you ensure that every manager and performance rater is on the same page with their scoring criteria and scale? It’s simpler than you think: You can accomplish this by using performance review calibration discussions.

Below, we’ll take a closer look at what performance review calibration is, why these conversations matter, and how your company can implement its own calibration process. Read on to learn how to hold your employees to the same standards and shape a more fair, consistent, and equitable review process

What Is Performance Review Calibration?‍

Performance review calibration trains managers to apply a uniform company standard when reviewing their direct reports’ performance at work. Calibration conversations typically occur after collecting peer, self, and manager reviews to allow raters to align and update their scores based on the established rating standard as needed.

Wondering why you even need performance review calibration? Let’s say you have two managers on the same team, Manager A and Manager B. Each manager has one direct report who, for the sake of this example, both work identical jobs and have the same work ethic, productivity, and overall performance. As the HR team, you’re surprised to learn come performance review time that these employees do not receive identical scores. Instead, their scores vary dramatically because each reviewer interpreted the scoring system differently.

  • For Manager A, a rating of 5 out of 5 meant that the reviewee was meeting the outlined expectations for their role and delivering great results.
  • For Manager B, a 3 out of 5 meant the same thing: This manager felt their employee was doing well in their role. However, they also know that their employee has the potential to grow their skills even further. So Manager B gave their staff member a lower score to help motivate them to go above and beyond in the next review period and take their career to the next level. 

While Manager B gave lower scores to their direct report — not as an act of harshness, but out of the very well-intentioned sense that every individual, not to mention the company itself, has room to grow — this can adversely affect their employees, especially if promotions and raises are tied to these scores. This is one of the potential downsides of ratings in performance reviews and how bias can creep into your process.

How to Conduct Performance Review Calibration Conversations

Once you’ve identified the need for your managers to align on a rating scale, it’s time to organize calibration conversations. Your company’s HR team is responsible for scheduling and facilitating these discussions, as well as ensuring managers leave knowing how to score their direct reports. Successful performance calibration meetings typically revolve around three things: Picking a scale, explaining what each number means, and figuring out what the distribution of scores may be.

1. Select a scale.

First, you’ll need to establish what type of scale your managers will use to rate their employees. One of the most common scales, and our recommendation, is a five-point scale that evaluates employee performance from 1 (poor) to 5 (great). A three- or four-point scale loses some of the nuance that comes with a larger scale, but feel free to pick a scale that works best for your business.

2. Define rating meaning.

Next, you’ll also want to determine descriptive ratings for each numeric value to further help your managers accurately interpret each rating’s meaning. For example, you can assign the following descriptions to each numeric value: 

  • 1 - Did not meet expectations
  • 2 - Sometimes met expectations
  • 3 - Consistently met expectations
  • 4 - Consistently exceeded expectations
  • 5 - Far exceeded expectations

Just make sure that whatever language you pick is clear, as terms like “average” or “good” performance are subjective and invite managers to use their own judgment to define their scoring. Using this standardized scale will ensure that everyone in the company has the same definitions of performance (so every manager knows what their direct reports must accomplish to be awarded a “5,” for example) and that managers know exactly how to explain these specific ratings to their direct reports. 

3. Determine the expected performance distribution.

Lastly, ask managers and leadership to determine what they expect the distribution of scores will be, or how many high and low performers they expect to see. When scores are distributed equally, your business should consist mostly of mid-level performers with a few outlying low and high performers. If you have too many low or high performers, you might need to revisit your recalibration strategy and ensure your managers are fully aligned on how to use your rating scale.

One 2015 research study conducted by Michigan State University and the College of William and Mary found that the calibration process — specifically calibration committees, which we’ll discuss in more detail below — is successful at reducing leniency bias, or the tendency of managers to rank their employees as high-performing to avoid confrontation or to help their employee get a promotion, raise, or bonus. However, calibration committees tend to increase centrality bias, or managers ranking employees toward the middle of the scale and failing to differentiate between poor, average, and top performers. So while these committees help managers adjust the scores of employees they initially marked as top performers, the recalibrated ratings tend to have more employees in the middle of the scale with fewer poor or exceptional outliers.

Again, this is why it’s important to know what distribution is typical for your business, or what your leaders expect to see. That way you can identify if you need to recalibrate your scores or if the new, calibrated employee ratings fall in line with your expectations.

Skip ahead to learn how tech empowers clearer, more equitable calibration sessions.

How to Calibrate Performance Reviews

There are two main ways to calibrate scores after the fact, and they depend on the size of your company. People teams at smaller organizations can conduct one-on-one conversations with each manager to understand how they interpreted the rating scale, and determine if some are rating their teams more harshly or more leniently than others. As this strategy won’t be scalable for larger businesses, an alternative is grouping managers into calibration committees to review and adjust employee ratings together. Here’s a closer look at these two approaches and how to use them to calibrate reviews.

1. One-on-One Conversations With Managers

If it’s practical, People teams at smaller companies should meet with every manager to understand the reasons behind their ratings. After hearing a wide range of reasons across departments, Human Resources professionals should be able to understand whether managers are too lenient, too strict, or “just right” in the scoring of their direct reports. Then, armed with both this information and a general understanding of overall business performance, your People team will have a strong sense of the overall rating distribution of the company and can update employee scores as needed.

One-on-one conversations
are very labor-intensive for HR professionals, so make sure you understand whether this is too large of an undertaking for your company before you begin. A simple way to know whether this strategy will work for your organization requires you to answer a very easy question: How many meetings do you think your People team can handle? If scheduling and conducting these meetings on top of adjusting scores seems like too big of a task for your HR department, calibration committees might be a better option for your business. 

2. Calibration Committees

For large organizations that need to have these conversations at scale, calibration committees can be the perfect solution. These committees are made up of groups of managers or skip-level managers that your Human Resources team can group together based on whatever criteria you’d like; this could mean that all the managers on a given committee are in the same department or on the same team, or even just leading similar-sized teams. With Lattice’s Calibration Groups, you can easily filter managers into groups and even save each group for your next review cycle. 

An HR representative should lead each committee's discussion and start by asking each manager to share how they interpreted the scoring criteria and why they awarded each of their employees the ratings they did. The HR representative should prompt further discussion and push managers to come to a mutual understanding of what level of performance and mastery of core competencies warrant each tier of rating. 

The group will also need visibility into every employee rating during the calibration session, whether that be via a spreadsheet or a People management platform. With Lattice, your People team can actually make any employee score changes directly within the platform — so there’s no need for wrangling spreadsheets, dealing with data entry, or worrying about sensitive information falling into the wrong hands. Once they have the knowledge they glean from this session, your participating managers can be more careful, consistent, and thoughtful about their employee ratings in the next review cycle.

After your calibration conversations, managers can finalize and share review ratings with their direct reports. If your team uses Lattice to calibrate employee scores, you won’t have to worry about employees seeing their pre-calibration scores; reviewees will only have visibility into the calibrated score, while only your HR team will be able to view how employees were scored pre- and post-calibration. 

Using Technology to Visualize Performance Calibration

When handled manually, performance review calibration can get complicated. After all, you’re seeking to apply objectivity to something inherently subjective: performance ratings. That makes it a cumbersome and high-stakes process, especially if you link performance and compensation. As your organization scales, managing the process via spreadsheets isn’t secure or tenable.

Performance review software should enable more than just the manager-employee conversation. Lattice empowers you to visualize the performance calibration process, making it easier for HR teams — and the managers on your panels — to facilitate thoughtful discussions.  

By representing the process in a customizable “box view,” calibrators can visualize employee scores in an intuitive and interactive grid. As your calibration conversations progress, participants can identify scoring discrepancies, reach consensus, and reassign employees into the appropriate boxes. Lattice makes that crucial, final step as easy as a drag-and-drop — empowering teams to visualize changes in real-time, even during calibration sessions. Just hover over the employee to compare their pre and post-calibration scores, reference current and past review cycles, or read notes for additional context.

Existing Lattice customers can read more about performance calibration in the Help Center. To learn how software can make performance management (including calibration) a more approachable, equitable, and transparent experience, schedule a Lattice product tour.

Review calibration is an essential step in any performance review cycle. It makes managers’ jobs easier, ensures that employees’ performance evaluations are more fair and honest, and helps your People team guarantee that all review scores are based on the same standard of performance. 

Simplify your calibration conversations by utilizing Lattice’s People management platform to create manager groups, update employee ratings in real-time, and analyze your data before and after adjustments to get the full picture of your employee performance. Schedule a demo to find out how Lattice can streamline your calibration process and help you create more fair reviews for your employees.