There are many suggestions dealing with Agile-friendly performance appraisals, which promise to rely on trust, honesty, respect, safety, and servant leadership. The Agile Manifesto does not address performance appraisal although it does generally mention regular and frequent feedback, which can also be applied to performance evaluation. Two related methods, Beyond Budgeting and Sociocracy, offer interesting approaches to agile performance review. In this session we want to present these two different performance appraisal approaches, how they're are supported by the values of BOSSA nova (short for Beyond Budgeting, Open Space, Sociocracy & Agile) and want to invite the participants of this workshop to discuss the synthesis of the two approaches. This session looks at several real-world examples from actual companies including Accenture, Equinor, and Google. The first principle of Beyond Budgeting asks to “engage and inspire people around bold and noble causes; not around short-term financial targets,” the eleventh principle advocates: “Evaluate performance holistically and with peer feedback for learning and development; not based on measurement only and not for rewards only.” Thus, the main strategy of Beyond Budgeting is to separate (financial) bonuses from performance evaluation and to use relative and not fixed targets as a foundation for the evaluation. Sociocracy suggests holding 360 degree in-person meetings. The person being reviewed should request it when needed, not just on a rigid annual basis, and perhaps not just once in the year. In the 360 degree meeting, the organization itself can be critiqued in the review - “the way we organize is causing performance problems.” Similar to Beyond Budgeting there is a focus on the vision and mission of the specific department as well as the overall company as a source of inspiration and motivation. The output of the performance review meeting should be a development plan that the immediate group of supervision, peers, and subordinates consent to. Based on BOSSA nova, we invite participants to dive into what Beyond Budgeting and Sociocracy combined offer for performance appraisals. Participants will take away insights that they can use in their organizations.

1. @AgileBossaNova | agilebossanova.org11
Jutta Eckstein | @juttaeckstein
John Buck | @johnabuck
http://agilebossanova.org
@AgileBossaNova | #agilebossanova
Using Beyond Budgeting and Sociocracy for
agile-friendly Performance Appraisals
Company-wide Agility with BOSSA nova
http://tinyurl.com/AgileBossaNova

2. @AgileBossaNova | agilebossanova.org2
Your Experience with Performance
Appraisals
■ Mark on the following sheet the common behavior /
attitude in your company
■ In pairs / triples discuss and take notes:
– How does this behavior / attitude affect the performance
appraisals?
– What are the top challenges you see and what are your
key insights?

3. @AgileBossaNova | agilebossanova.org3
Note the statements that reflect a common
behavior / attitude in your company
Source:https://bbrt.org/the-beyond-budgeting-principles/
1 Leadership makes information open for self-regulation, innovation, learning
and control.
2 Management processes set Goals are fixed and cascaded goals.
3 Everyone’s work is connected with customer needs.
4 Management processes are aligned to the calendar year.
5 Leadership restricts and controls information.
6 Performance is evaluated holistically and with peer feedback for learning
and development.
7 There are often conflicts of interest between the customer needs and other
company interests such as shareholder value or increasing sales to the
customer.
8 Management sets directional, ambitious and relative goals.
9 Management processes are organized dynamically around business
rhythms and events.
10 Performance evaluation is based on measurements only and for rewards
only.

4. @AgileBossaNova | agilebossanova.org4
Probe: Are performance evaluations really
reflecting customer focus?
■ Background:
– Company values are often lip service, other values often
rewarded.
■ Hypothesis:
– If customer focus is the foundation for performance
evaluation, customer satisfaction improves.
■ Experiment:
– Invite an experimental unit to write own performance
evaluation criteria related to their work & reflecting
customer interests.

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Probe: Will aligned individual growth
happen without motivation by a bonus?
■ Background:
– Often individual objectives are not revisited and if the market changes,
the objectives might become out of date.
■ Hypothesis:
– If we separate bonus/incentive payments from the learning process,
individual growth will happen in alignment with the company’s
strategy.
■ Experiment:
– If you have changing conditions, increase the frequency of
performance evaluations weekly, monthly, quarterly.
– Use qualitative Objectives and quantitative Key Results (OKR).
• The OKRs are defined bottom up and are always a contribution to the
company’s overall goal.

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Self-Organization
■ Accenture:
– Frequent conversations (“check-ins”)
– Realign goals to respond to change
– Conversations focus on both reflection and future. The
latter is stressed more
■ Equinor (former Statoil)
– Individual performance goals can be changed by the
teams but
• They have to coordinate the change with other teams &
• Big approvals require approval one level up

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Transparency
■ Endenburg Electrotechniek (Electrical Engineering)
– 360 degree review in person
• Not anonymous comments collected by a manager
• In a circle: your supervisor, a peer to you, a couple of people
reporting to you
• Like a retrospective,
– each person (starting with you) offers things you’re doing well (& the
system is doing well)
– each person (starting with you) offers improvements
• Everyone consents to your development plan (and changes
needed in the system)
• The plan is approved by full circle

11. @AgileBossaNova | agilebossanova.org11
Constant Customer Focus
■ Everything done in an organization should add value for the
customer, thus:
– How does the performance support creating customer value?
– Does the performance inspire others to create customer value?
■ As a team create a value stream and discuss:
– How effectively are we creating customer value?
– Where do we see conflicts of interests in our work e.g. selling to the
customer instead of serving the customer’s needs?

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Continuous Learning
■ Cox Automotive
– Framing goals to promote cross-functional collaborative teamwork
– Learning and adapting goals throughout the year
– Getting feedback on goals and development
■ Equinor (former Statoil)- Analogy of 100 meter sprinter
– How you ran is different than the time you got.
– The outcome is different from your process.
■ Link appraisal conversations to team retrospectives (Source: Agile
People)
– Invite team members to evaluate their contribution to the sprint

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Application To Your Challenge
■ In small groups discuss & note:
– How can you use the BOSSA nova values & approach
(probing) to address your top challenges?
– Develop possible probes and experiments for one of your
top challenges.

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Lessons Learned
■ Personal conversations
■ More than 1-on-1s (e.g. bring an “official” and a peer)
■ Regular feedback (not only e.g. once per year)
■ No long-term (fixed) objectives - have relative objectives
■ Separate growth / development from bonus
■ Focus more on future than on past
■ Align goals to customer value

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Many Thanks and… Stay in Touch:
PicturesbyKatjaGloggengießer
Jutta Eckstein | @juttaeckstein
John Buck | @johnabuck
http://agilebossanova.org
@AgileBossaNova | #agilebossanova
Company-wide Agility with BOSSA nova
http://tinyurl.com/AgileBossaNova