Your rating scale says a lot about your organisation

Had several discussions this week with clients looking at their overall rating scales.  Usually the discussion starts with ‘shall we have 4 points or 5’?

It might seem a technical issue – but the choice of scoring scale, and the split between positive and negative scores sends a powerful subliminal message to the workforce about what the organisation values.

In brief: a 5 point scale suggests to your employees you are expecting some kind of ‘bell curve’ shape around the number 3.  It also suggests that scoring 3 means you are rated ‘average’.  Since average has become a de-based word (average = bad in common parlance), then scoring 3 can be seen as a bit of an insult.  The effect of this is that assuming 1 is high and 5 is low, the actual average score using a 5 point scale is often nearer 2.  This applies whether the organisation is a top performer or not.

I usually recommend a 4 point scale.  However if you set 1 and 2 as positive while 3 and 4 are not this indicates that the organisation is just as concerned at nuancing poor performance as it is at understanding the development of high performance.

To really drive high performance, you need to be able to differentiate between for example good, excellent and genuinely outstanding.  This would give you a split where  4 accounts for a below par score, while 1, 2 and 3 are all positive.

In general, there is little to be gained from detailed analysis of poor performance in terms of annual rating.  Anyone scoring 5 on a 5 point scale should have been dealt with long before performance review.  Therefore the score of 4 on a 4 point scale is perfectly sufficient to give a jolt to underperformers, while leaving scores of 1, 2 and 3 to make clear that there is a lot to do to be a truly high performer.

A bit of a technical issue – but none the less one that actually sends a lot of subliminal messages to the workforce!