Goldman Sachs Group is one of the latest firms to hop onto the “360-degree” feedback bandwagon.
Joining the likes of Accenture, Adobe Systems and Microsoft, the investment bank will no longer rate staff on a scale of one to nine in employee reviews.
Starting next month, the firm will appraise its staff via an online system which allows professionals to give and receive continuous feedback on their performance.
“Last year’s people survey results show that you want more real-time feedback to support your ongoing development and that such feedback is critical to your experience and tenure at the firm,” chief operating officer Gary Cohn told the bank’s employees via a video about the changes.
Cohn and CEO Lloyd Blankfein also announced the changes in a memo to staff last week.
“Over the course of the next year, we will adopt new feedback practices to focus further on growth and development,” chief executive officer Lloyd Blankfein and President Gary Cohn wrote in the memo, which was sent to employees last Wednesday.
“Providing high-quality and ongoing feedback is at the heart of our culture, and is an important investment we make in our people and the future of our firm.”
A separate memo from head of human capital management, Edith Cooper, described the changes in more detail.
The new system will be rolled out in June, and will emphasise on qualitative feedback – what people do well and how they can improve – rather than numerical scores.
In addition to a written summary, managers will provide an overall rating on a scale of outstanding, good and needs improvement to vice presidents, associates, analysts and administrative assistants.
To incorporate the new system, the company had urged managers to carry out review conversations with their team over the summer rather than in the fall, giving employees additional time to improve their performance ahead of bonus decisions and annual cuts.
In addition, Goldman will try out a web-based tool for some employees to give and receive performance feedback at any time.
The hope is that the additional inputs will lead to more frequent one-on-one conversations with employees and managers, she said. The bank hasn’t determined which departments will try out the system.
Cooper said performance reviews play a role in determining employee bonuses and promotions at Goldman, and will continue to do so. She declined to say how much weight those evaluations carry.
Along with J.P. Morgan Chase and Citigroup, Goldman has enacted several management changes focused on retaining junior bankers.
It is believed that new appraisal system is part of effort in retaining the Millennials who are looking for lots of attention from leaders and managers who will spend time with them and help them develop.
Last fall, it announced an initiative to fast-track junior bankers as well as provide them with more mobility and lessen their workloads with the increased use of technology.
Colleagues at Goldman frequently have informal conversations about performance, said Elizabeth Reed, a vice president in the investment-banking division.
The new guidelines help set expectations for how often managers should be checking in with their staff members, she said, adding the new tool is a “medium to express that more regularly.” she told the Wall Street Journal.