2/9/22, 8:34 PM Case Study: A New Approach to Performance Management at Deloitte

Case Study: A New Approach to

Performance Management at Deloitte
By Jeff Orlando and Erica Bank

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“It was an investment of 1.8 million hours across the firm that didn’t fit our business needs anymore.” That’s how partner
Rob Massey, Deloitte Tax LLP, described the performance management system he used for his first 12 years at Deloitte.
“Once a year, we looked back at what people did and then created a label for it.” 

For the last 18 months, Massey and 2,000 of his colleagues in our tax business have been piloting a new way of
assessing and managing our people’s performance, along with thousands in other parts of our professional services
business. It’s been so successful that we’re rolling it out across our entire 70,000-person organization over the next year.
The key parts: check-ins, frequent conversations between team leaders and team members about the work;

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performance snapshots, a reliable and frequent assessment of individual performance; and pulse surveys, a quick tool
for team leaders to assess if they are creating the conditions for high performance on their teams.

The power in this innovation: combining what we know about two dimensions of human behavior: 
How to engage and motivate people—the primary channel here being conversations with others
How to collect and use reliable assessments of individual performance—to help our people and the business.

Put together, it’s working. Massey says, “Today we’re very forward-looking. It’s about strengths and real-time
communication.” 

First and foremost, this system is analog. It’s about conversations. That may have been the biggest leap we took in
reinventing our performance management system. We’ve learned that words can be as powerful as numbers; that data
only tell part of the story. We need to let our people, their managers, and their counselors tell the rest.
 
We haven’t moved away from data altogether, the “digital” in the system. In fact, we’ve doubled-down. We deploy it
regularly and use a variety of tools that bring in perspective from our people and leaders and use them to help manage
the people element of our business in real-time, to identify what conversations are needed, and to help our people
understand how they can grow and advance.

Let’s zoom in on the experience of one of our people to see the system in action. Here’s Kay, a senior manager who has
been with us for more than a dozen years:

“I’ve always had check-ins with my counselees, the managers on my team. These used to be tactical, day-to-day ‘What’s
happening, what do we need to fix?’ But now I’m more conscious of weaving the performance management piece—
development, especially—into the check-ins. I’m taking the time, even if it’s just ten minutes, to talk about their personal
development, what’s happening with their goals, with their strategic initiatives in terms of where their careers want to go.
I’m having those conversations more frequently and it feels more personal—not as canned or forced as a midyear or
year-end check-in.”

Of course, Kay also sits on the other side of the table. She is a counselee, too. 

“I’ve found that my counselor is now very open to redefining my goals as we move through the year. My goals aren’t
documented in stone like they used to be. I was trying to find some stretch opportunities this year. At the beginning of
the year, we thought that would be one thing, but halfway through the year, I completely shifted focus. My counselor
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didn’t sit down and say, ‘Let’s redefine your goals.’ It wasn’t about me going back to my office and documenting four or
five commitments I would make. Instead, we talked about what kind of performance people would expect of me in that
new capacity. It was more a natural conversation, a discussion—and you get easier buy-in from both the manager’s and
the counselee’s perspective when you’re creating goals around a real scenario instead of trying to look ahead for 12
months at the beginning of new fiscal year.”

Kay’s story demonstrates exactly why we chose to create a flexible and fluid system. Without a formal list of things to
discuss, our people steer the conversations to what they most need to talk about in the moment: current performance,
challenges with an assignment, or—in Kay’s case—how and where to stretch her skills for growth. Massey says, “The
conversations are more holistic. 

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They’re about goals and strengths, not just about past performance. We’re likely to say something like, “Of course you
did a great job, but did you really like it? What kind of work inspires you?” When people work on projects that excite
them, they become more engaged and perform better. That benefits all of us—our teams, our clients, and our
organization.”

Having these conversations is relatively easy when you’re talking to a high-performer like Kay. But what about the
people who need a course correction? As Massey notes, “Very few people feel great about having tough conversations.
It can feel uncomfortable.” We help our team leaders work through this natural reluctance with extensive role-playing.
But nothing beats the experience of doing it, as Massey discovered recently when he had a year-end conversation with
a professional who was struggling. This man, we’ll call him Tim, had not really processed the feedback he received from
his supervisors. But when, as part of an experiment within the pilot, Massey showed him a scatter plot of the data his
local supervisors had submitted on him through the year, Tim saw how his performance compared with his team
members’. 

“The look on his face spoke volumes. It was the same look you see when you ask someone to leave Deloitte. But the
difference was, I wasn’t asking him to leave. I was asking him to pay attention. His supervisors had been telling him these
things, but he didn’t really ‘get it’ until he saw his dot on the chart. He’s now going into his check-ins with a different set
of ears,” said Massey.

Together, Tim and Massey worked out a plan as to how he’ll have better, more effective communications with his
supervisors. “When he left my office, Tim was energized to ‘get in the game.’” Massey calls the result “a huge win. Our
new system is testing giving people a great deal of transparency in terms of their performance and gives them enough
time to self-correct if they need to. This was two months ago. Today, Tim is doing great.”

Transparency

That “transparency” Massey mentioned is one of the most intensely debated—and carefully considered—elements of the
redesigned system. Our reinvented system includes a four-question “performance snapshot” that is completed by an
individual’s supervisor at minimum four times per year; the majority of our people have upwards of 10 snapshots in their
archive by the end of the year due to the variety and duration of the work that they do. The essential question continues
to be, how much of this performance data should we share with our people?

Heidi Soltis-Berner, now Deloitte’s talent director for Evolving Workforce, led the implementation of the pilot in our tax
business. She says the team spent a full six months hammering out the details of whether—and then, eventually how—to
share information about an individual’s performance as part of a “test” to evaluate its effectiveness. Some stakeholders
argued against disclosing too much. Some felt that it would be best to give people raw data, in the form of a scatter plot,
and let them draw their own conclusions from it. 
We have constructed a research-driven approach to help in making this decision, which includes:

Employing control/test group techniques to see if revealing data to an individual would change either the data
itself (risk of skewing the data if supervisor knows it will be revealed; we all want to be nice) or impact individual
engagement levels (concern that “seeing where you stand” could demotivate due to the natural tendency of
people to have positively-skewed self-impressions).
Consulting decades of research on stress and performance that lead us to the conclusion that a moderate
degree of “positive stress” is a precedent to strong performance—and some stress introduced by seeing one’s
relative position, when contextualized with care, could help our people achieve more.

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Considering the opinion of our people. Like most organizations, we have been moving to a more transparent
culture, and our people expect to know what we know.
Internationally, a number of countries have “sunshine laws” that require open access for employees to their own
records.

Now, with our internal studies complete and arguments on both sides of the debate prepared, we have assembled a
group of business and talent leaders to make a final decision on just how transparent we’ll be with this new performance
data. Regardless of the outcome, using this complete, data-led approach will boost adoption and build confidence of our
people in the quality of the decision.

Beyond the mechanics of what, how, and when, a key human element that helped drive the pilot’s success were the
“change champions” who stepped up to help socialize the ideas. “We knew we couldn’t do this by bringing in ‘experts’
from outside,” Soltis-Berner notes. “So we assembled an outstanding team of leaders—senior managers, directors, and
partners—who were passionate about making this change work. We ended up with nearly 200 ‘change champions’
working with the pilot group of 2,000 employees, so they were able to communicate on a personal level, often even
one-on-one. And that’s exactly the kind of personal communication style we were aiming for with the performance
management redesign.”

Learning from the Pilots

The 2,000 people in our pilot program have now been through an entire compensation cycle under the new system, and
their colleagues are eager to join them. We’ve rolled it out across the tax business now, and by June, all of our
professionals in the U.S. will be participating. “Relatively speaking, the speed at which this change has happened is
breathtaking,” Soltis-Berner says. “But we planned for that. When you’re dealing with a subject as sensitive as
performance and compensation, you have to be decisive. We knew after a year’s pilot, we would have to rip off the
Band-Aid, for better or worse. Fortunately, the system is working well.”

Rob Massey says, “We’ve taken this concept that’s really bold and different and hard to get a handle on, and we’ve
invested a lot of time and money in it because we see the benefits for our people. We’ve taken a very innovative, long-
term view of what Deloitte’s culture can be and how we get the best from every person. As an owner watching that
investment, it makes me very proud.” And his people would tell you he should be. As Andrea Schulz, a tax senior
manager said, “This system really has engaged me, it’s motivated me, and it’s turned me into a better professional.” 

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We’re not just seeing those benefits anecdotally, through the stories like the ones Heidi, Rob, Kay, and Andrea have
shared. As a firm, we’ve been able to aggregate new data that helps us understand people, team, and leadership trends
we’ve not before been able to see. We can now see the powerful connections between measures like employee
engagement and employee performance, or feedback conversation frequency and employee performance. Beyond just
the compelling stories our leaders tell, the data is helping us to refine our business case for this model, and arm our
leaders and change champions with insights they can use to deepen adoption and understanding over time. That’s been
powerful for us, and is something we believe, will have a lasting effect on our culture.

Todd Sweeris, a partner and part of the pilot, sums it up by saying, “We’re still learning the power of the new system,
understanding the right cadence for everything; it puts the focus on development of our people, and that is really the
goal of a performance management system—how do we get our people performing at a higher level?”

At Deloitte, our emerging answer is both digital and analog—quantitative and personalized—to get the best of, and for,
everyone in the firm. 

Jeff Orlando is chief learning officer, leader development and performance at Deloitte. His scope includes Deloitte’s

leader development strategy, onboarding through executive development activities for Deloitte’s 70,000 professionals
and partners, and performance management approach and analytics. He can be reached at jorlando@[Link].

Erica Bank is Deloitte’s performance management leader. She designs and implements talent management strategies,

processes, and technologies. She provides strategic direction on the management and continuous improvement of
current performance management processes, and has been a key leader in the firm’s performance management
reinvention. She can be reached at ebank@[Link].

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