January. For many organizations the time of year to review the performance of their staff. Traditional reviewing means looking back and rating last years’ performance. With one of my clients, we decided to do it a bit differently this year: we used the 9 box model for reviewing the employees’ performance.

Traditional performance review systems have a big limitation, they can be base for decisions about the employee’s future within the company, based on the performance of the past year. There could be a pay raise, a promotion, a development plan, new objectives or even the end of the contract. In this way, performance rating can have big consequences for both your team and for individual employees. The instrument in itself is quite limited though; usually, it is a five-point scale with not much space for nuance.

By using the 9 box model instead, we add another, and very interesting dimension: the future potential of the employee.

 

What is the 9 box model?

 

The 9-box model (or 9 grid model) is also called the Performance and Potential Model and has been developed by McKinsey. It is a tool in which employees can be rated by both their performance and their future potential. The 9-box model is an easy tool to work within all its simplicity. Its two dimensions makes it relatively easy to rate the employee in the right box. Meanwhile you can add much more nuances than just performance rating.

The placement in the boxes gives you an indication of what should be happening next in terms of performance management, like replacement, improvement or promotion. The 9 box model can also be used for talent management or succession planning.

 

This is what the 9 box model looks like:

As you can see, with the nine-box model you can determine both the performance as the potential. This will then give you the placement in one of the nine boxes.

 

How did we use the 9 box model?

 

I had individual meetings with members of the leadership team to explain the model and what we would be doing. In the meeting, the manager would determine the indicative placement in the 9-box model for each of his/her team members.

Next, we had a consistency meeting with the Senior Management team. During this meeting we discussed the indicative placement with the other team members. Each manager gave his/her view of the employees’ performance, potential and development need. When the views were non-consistent the differences would be discussed more in depth.

We didn’t take minutes but for each employee. But noted one or two sentences about their performance, potentials, and the next steps. The placement in the 9 box grid and these notes form the base for this year’s performance meetings and development plans.

 

What is the difference compared to the previous Performance review system?

 

Although  past performance is still rated on a five-point scale, using the 9 box model in this years’ approach forced us to answer the following questions:

• Where can this person improve?
• What are the next steps for this person?
• In what area needs this person to develop themselves?
• In case of underperformance, is this due to organizational circumstances or is it indeed based on individual performance?
• Do we expect this employee to be capable to be the successor of their manager in 3 to 5 years?
• In which box in the grid should this person be next year?
• What skills does this person need to develop?
• In case this person is eligible for a promotion, can we offer them their next step?
By just adding the potential dimension in the 9-box grid we ended up with a fairer and more responsible performance review meetings that are not only looking at the past but also at the future potential of the employee.

For an even more complete performance review system, I recommend putting a system of continuous feedback in place. Read more in my blog post: Millennials in the workplace -The importance of instant feedback

 

What are the benefits?

 

• Using the 9 box model provides structure and it will help define actions next steps
  • You’ll bring the review to a more strategic organizational level because it touches next level jobs and succession, and not just individual performance.
  • The model pays more attention to the distinction of soft and hard skills.
  • It gives a better view of the persons’ growth path over the years when you need to indicate next years’ place on the grid.
  • It gives a clear direction for management on which areas to focus on performance management.
  • You don’t need much paperwork or procedures
  • It makes managers to really pay attention to the person, his skill, and their ambitions.

 

 

What are the downsides?

 

Of course, there are a few things to consider when you start using the 9-box model.
Performance is usually not so difficult to determine but the potential is more tricky. You can have potential on different levels and your team of managers should be talking the same language.

For example, does this employee have the potential to become a Senior Manager? Or can he develop himself within his current job to a more senior level? Is it management potential or just the ability to develop him professionally to different job levels?

You could start out with a discussion about what potential means for you and which potential you are looking for. If you were using the tool for Succession Planning, then the potential would be the ability to grow into a more senior role.

We didn’t define potential before because we wanted to have an open discussion and get a clear picture of all the potential that is present in the organization. Also, this approach led to determine the direction of development for each employee and the next steps in performance management.

Another downside of using the 9 box model is that future potential is something that is hard to predict. It is usually based on past performance in the current role. Strong performance in the current role doesn’t mean equal performance in a more senior role. Management roles, for example, require a different skill set than professional roles. Aspects such as motivation, ambition, and flexibility also determine potential. It would be hard to predict to which extent those aspects would be visible.

 

Conclusion

 

This company had until that moment quite a traditional approach to performance reviews. Adding the 9 box model opened a discussionaround talent development, succession, potential, and strategy. The model is there for more than a performance review tool, it is also a strategic tool that will help you to build the future of your organization. Besides that, it is quite simple and will give you a more clear path to growth and talent development.