Most of us think of performance reviews as a required part of organizational life. They usually take place once a year, either around a hiring anniversary or at year’s end, and they tend to make most people nervous.

One of our senior associates recently made an interesting observation about the process used in the firm. He said, “Continuing employment is kind of an ongoing pass/fail decision. Either you are good enough or you are not. So, for all of us who have a ‘pass,’ performance management should be based on the assumption that we are good but that we all still have a lot to learn.”

I think this is right. Performance assessment takes place on two levels—the first is the pass/fail level. Is this someone we still want working here?

Once past this point, however, it is all about identifying learning needs and then meeting those needs through a variety of means. At our firm we use seminars, conferences, internal monthly clinics and professional development workshops, and twice a year three-day retreats. This is supplemented by our physical and virtual library (on our Intranet) and a variety of readings we regularly recommend to one another.

This view of performance management replaces the “report card” approach with one driven by employee learning.

Each year every employee creates a review of her recent performance, including a plan for professional development, and shares it with her supervisor, who then writes a response. This leads to learning goals for the next year.

Recently we began augmenting this process with information from post-engagement client satisfaction interviews, which an outside consultant conducts on most projects.

In 2007 we will also peer-review a sample of each person’s project work on a quarterly basis. It is all in the service of learning and better serving our clients, in an industry where our staff’s collective knowledge and skills is our only true asset.

Why do management discussions get so quickly into the weeds?

It may be that the presence of both operational and strategic questions on the same agenda will always short-change the latter. When the house is on fire, it’s hard to think about whether you want to build an addition.

One suggestion from consultant Michael Mankins is to separate management team meetings into those where operational issues will be addressed (personnel, finance, and process problems by-and-large), and then set aside a separate session for big questions that usually revolve around strategic choices.