The Performance Bias: Why Your Team Is Not Working Better
And what to do about it
Everyone loves high performers — hot shots who deliver exceptional work on a regular basis are unique.
There’s a problem I frequently observe when facilitating team offsite and workshops. Most managers are obsessed with top performers. However, this quest for having perfect employees is hindering performance rather than improving how people work. Not only they generate a divide — low performers feel ostracized — but managers become blind: they believe some employees are perfect.
Categorizing people by performance, though it has some benefits, can create more harm than good. I’m not telling you to get rid of it, but to watch out the bias it creates across your organization.
Managers forget to see those top performers have problems of their own; they are anything but perfect. Also, the performance of a team can not depend solely on a bunch of exceptional people — improving the collective performance, not the individual one, should be the goal.
The performance bias might be hindering your company’s potential. Dividing people into great and bad could be damaging rather than improving overall performance. Let me explain why.
1. The halo effect — we see what we want
Categorizing employees helps assess the current situation. However, the problem is applying a black and white approach — to see people through a distorted and exaggerated lens. Top performers are perceived as superheroes and low performers as the villains.
The halo effect happens when managers have a hugely positive view of a particular employee. They see them as more extraordinary than they actually are — they miss to acknowledge their areas of improvements.
Low performers are also ‘punished’ by the halo effect — their managers will exaggerate their flaws. As human beings, we all have a natural tendency to confirm our pre-conceived beliefs. This confirmation bias clouds our perception of people and events.
Our beliefs encourage us to take sides, rather than to ‘see’ other possibilities.
The halo effect damages objectivity when assessing people — it affects management and peer-to-peer evaluations alike.
What to do about it
Have the team assess all the members rather than just the manager. Having different perspectives can factor out the bias.
Approach performance with a more realistic approach. Avoid idealizing top performers or being too critic with low performers. Understand what’s hindering performance — focus on the action rather than on the current status.
2. Stigmatizing — Labels put people in a box
Our behaviors are dynamic, not static — even top-performing employees can get stuck from time to time too. However, labeling people as ‘top performers’ and ‘low performers’ creates the impression that employees belong to one group or the other. We are encouraging people to behave according to the label we assign them.
Labeling people forces everyone to focus on the present reality rather than on the potential. Neuroscience shows that the words we use to describe others shape their self-image. That’s the problem with labeling: they limit people’s development by putting them in a box — they become the label.
Labels don’t just limit employees, but managers’ perceptions too.
What to do about it
Shift from a static to a dynamic approach — instead of labeling people, focus on what conditions can be modified to unleash people’s potential. Google and many other companies found that, by rotating ‘low performers’ into a different team, they drastically improved their behaviors and contributions.
Similarly, are you providing a safe space where people can bring their best selves to work? Many times, what managers see as low performers are people who are merely silencing their best ideas because they are afraid of being punished. Also, extrovert managers tend to ignore the power of quiet people — being quiet doesn’t mean not being smart, as I wrote here.
Remember that the world is not divided between low or high-performers. The majority of people fall in between as shown below.
3. Comparison — the danger of applying external standards
Rankings are good for competitive sports, not for encouraging teamwork. By forcing people to compare to others, rather than promoting development, we are hindering it.
Comparing to others is an unhealthy practice — there’s always going to be people who are either better or worse than ourselves. Focusing on the gap is deceiving — we will get either frustrated or too comfortable.
Enron had a practice of grading their employees annually and firing the bottom 15 percent regardless of their absolute performance. If you were weak, compared to others, you got yanked (‘rank and yank’ was how employees referred to this practice).
The ‘everyone against everyone’ practice didn’t work for Enron. The pressure to defeat internal competition forced a ‘whatever it takes’ mentality — their executives decided to hide losses through accounting tricks. We all know how that story ended.
What to do about it
Internal competition is healthy; to turn your team into competitors is not. Find a balance between being competitive and creating a ‘winning at any cost’ culture.
Move beyond the usual carrots and stick reward approach — internal motivation is more effective. As Daniel Pink explains, the motivation 3.0 approach is about autonomy, purpose, and mastery. Every person wants to be part of a mission bigger than themselves, to get better at what they do, and to have control over how they do their work.
Telling people how to do things doesn’t work — coach them to find their own solution. Comparisons make people focus on others rather than on what they must improve. Employees that behave autonomously become more accountable.
4. Mental inertia — the tricks our memory plays
The ability to recall an employee’s performance throughout the year is almost impossible. Most managers suffer from mental inertia — they remember the most recent events (especially if they are negative).
The recency bias can affect our objectivity — we make wrong financial or personal decisions. We are inclined to use our recent experience as the baseline for what will happen in the future. Though this bias can work fine most of the times; it can be deceiving when dealing with people. Human beings can behave in ways that we usually wouldn’t expect.
Studies show that high-performers are more likely to quit in times when things get tough — those who are used to winning all the time or have very high expectations, usually fail to overcome adversity.
The recency bias — focusing on recent or tiny negative incidents — creates the perception that employees are being micromanaged — they feel their bosses can’t let go of details instead of focusing on the bigger picture.
What to do about it
Many companies such as Netflix believe that honest and straightforward conversations on a regular basis create better results than rating everyone on a five-point scale.
Turn on-going feedback into a habit. Encourage your team to identify and solve their tensions on the go — it’s easier to fix problems at an early stage than when they’ve already become toxic. Also, performance improvement is critical to address it just once a year. That’s why many companies are replacing annual performance reviews with ongoing feedback, as I wrote here.
5. Feeding envy — dividing the team
Idealizing top performers doesn’t encourage others to improve their game. On the contrary, it positions them as threatening.
Decades of research show that, when we size ourselves relative to others who are better than us, we experience discomfort and fear. Envy, a resentment toward others because of their possessions or success, divides teams.
When we fall short, envy clouds our behaviors — we focus on undermining others rather than on raising our own bar. University of Minnesota studies suggest something even more frightening: peers lash out star employees strategically — only when it is not in their best interest to support them.
What to do about it
Addressing individual performance is important, but avoid encouraging people to compare against each other. Reward collective behaviors and focus on improving overall performance.
Shift the attention from sizing oneself relative to others: how can everyone contribute to making the team better?
Match high performers with low performers — having an accountability partner within the team is more effective than being told by one’s manager what needs to be addressed. The accountability partnership invites people to commit to own their path towards constant improvement, as I explain here.
Help people recognize the benefits of collaborating with high performers rather than seeing them as enemies.
Organizations must focus on collective performance — instead of dividing the team, coach them to raise their bar as one.
Self-awareness is a powerful tool for team building — it’s about having an accurate view of one’s skills, abilities, and shortcomings. Team awareness is practicing it at a collective level. Research shows it increases decision-making, coordination, innovation, and conflict management.
A self-aware team can regulate how each individual plays — when everyone shares the same purpose, they don’t see each other as a threat, but as a partner who can help them become better.
Though it sounds counterintuitive, it’s easier to improve individual productivity by focusing on the team performance than the other way around.
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