Best Employee-Evaluation System

I had recently heard a Ted talk from Ray Dalio who is an American hedge fund manager and an idea-full person. You can listen to the 15-min video below. It was soo inspiring that it instilled a thought in today evening around how an ideal employee evaluation system should look!

Ray goes on to elaborate his thoughts beyond the dot collector which he used as a primary way to judge the performance of his employees and to inculcate a sense of transparency in his firm. All of his efforts had one agenda, to make sure that no idea goes unheard!

Now before I jump into my analysis of Ray’s dot collector, lets first understand how it looks like! Although Ray’s deployed dot collector had a much complex set of evaluation questions, below is a representation of that which could cover many other work verticals (not just finance):

Dot Collector is an always-on evaluation system where employees rate and share with each other - Ray Dalio

Employees rate each other in ALL meetings and without giving much explanation. It’s expected and acceptable that one person’s assessment can be completely tangential to another person. The dot collector’s data can be used by employees to suggest improvements, decide a project team and even shoot people up/down for promos. Employees can access not only their traits as rated by their peers individually but also other’s traits who rated them. For example, a designer might rate a developer as Believable too whereas a developer can rate the creative person as Not believable assuming his creative knowledge is low. This could prompt the designer to change his language so that developers understand the reasoning behind his decisions.

Pros

I was able to see major merits in this system, atleast so much that had I had some authority over testing this out, I would go for it! Let me list down my reasons:

1. Dot Collector is very open, so evaluation is always accessible and one can always try to rectify their ways before their fate is sealed for another half/year as it happens in most performance cadence.

2. Dot Collector not just aims to distribute the rewards to employees via their promotions but also help them pair up with ideal folks where their productivity can be improved.

3. Dot Collector understands and depicts human bias while being inclusive to the seemingly most silent people in the room.

Cons

There are some points where I feel more thought is needed:

1. Dot Collector is only as much effective as it’s questions and the motivation of people to carry such a system in all meetings. It sounds like a structured way of using Thankyou and Kudos tools deployed in many companies to celebrate peer’s effort.

2. Dot Collector may not represent the needs of an organization when needed! We would not have data on a new person causing the view to suffer from bias. For example, it could suggest promoting a new employee after his/her first presentation is loved by many attendees.

3. Dot collector may be biased towards socially charismatic people and against less influential people, making it more suitable towards non-pure-tech roles. Gaming the system seems easy!

Closing Remarks

I feel Dot Collector system needs some modifications and a more comprehensive thought around its implementation. With a limited idea around the tool, a few Pros and Cons will always be missing unless there is a case study published and ratified by many. It looks very thought-provoking and promises to be closer to an ideal employee assessment system by addressing some flaws that exist today.