Killing performance ratings: what 8 companies actually replaced them with.
Adobe killed ratings in 2012. The press loved it. The actual replacement — and the failure modes that followed — never made the keynote. Here's what 8 companies that went rating-less actually did, and what worked.
Killing performance ratings is the HR equivalent of switching to a standing desk: everyone announces they did it, almost nobody talks about month nine. The honest version is messier and more interesting.
I've worked with or studied eight companies that went fully rating-less. Five made it stick. Three came back to a modified rating. Here's what each replaced ratings with — and what the post-mortems look like.
What replaced ratings — by company type
- Frequent (monthly) check-ins replace annual review
- Forward-looking goals, not backward-looking scores
- Compensation decisions made by managers + comp business partner with calibration
- Promotion decisions on separate (more rigorous) cycle
- Examples: Adobe, Deloitte, Microsoft (partial)
- Replace rating with a short written narrative + 2–3 evidence artifacts
- Calibration meeting uses narratives, not numbers
- Comp tied to band + narrative + market
- Promotion has explicit rubric, separate from comp
- Examples: Netflix, Stripe (modified), GitLab
What didn't work
- 'Just remove the rating, change nothing else.' Three companies tried this. All three came back to ratings within 18 months because comp decisions had no defensible logic.
- Replacing a 1–5 scale with a 1–3 scale and calling it rating-less. Employees see through it in one cycle.
- Going rating-less without investing in manager calibration training. The result: same biases, no audit trail.
- Eliminating ratings but keeping forced distribution. The most cynical of all — the rank is still there, just hidden.
The three things every successful rating-less company did
1. They replaced the artifact, not the conversation
Calibration didn't disappear. It moved from a number on a spreadsheet to a narrative in a meeting. The hard work didn't go away — it became more honest.
2. They separated comp, promotion, and feedback
The original sin of the 1–5 rating is that it tried to do three jobs at once: tell you how you're doing, decide your raise, and decide your promotion. Rating-less companies that work do all three jobs separately, with different cadences and different evidence.
3. They trained managers in writing, not in talking
When the rating becomes a narrative, the bottleneck becomes a manager's ability to write a defensible paragraph. That's a skill most managers were never taught. The successful companies invested in it.
HR & Operations leader scaling global remote teams across Nepal, the Philippines, Australia, and the US. Tech-leaning writing lives on Medium.