A Credit Union Solution To The Dreaded Annual Review

Northwest Community Credit Union uses a collaborative approach to staff reviews rather than traditional performance evaluations.

Employee evaluations, pay raises, and even whether to stay or go at Northwest Community Credit Union ($989.7M, Eugene, OR) is now a collaborative journey that began with a newspaper article.

The 102,336-member institution has abandoned the traditional annual review and now uses the Active Performance Management (APM) program to improve the quality and frequency of its evaluations.

Formal annual reviews are fraught with problems, not the least of which is their natural awkwardness.


Northwest community credit union
Data as of 12.31.15

  • HQ: Eugene, OR
  • ASSETS: $989.7M
  • MEMBERS: 102,336
  • BRANCHES: 21
  • 12-MO SHARE GROWTH: 8.88%
  • 12-MO LOAN GROWTH: 3.74%
  • ROA: 0.64%

Managers save everything for a year, then they sit down with an employee and everybody’s nervous and no one really enjoys it or benefits from it, says Northwest Community’s chief administrative officer Melissa Vigil. We knew there had to be a better way.

Northwest Community learned about retail cooperative REI’s APM program and put one in place itself in 2012, not long after Vigil arrived.

We’re a credit union that believes in innovative ideas, so we said, Let’s give it a shot,’ Vigil says. And that’s what we did.

The journey to a better way began before that, though, with an article Vigil says rocked the HR industry. Titled Get Rid Of The Performance Review,the 2008Wall Street Journal piece laid out a litany of problems the traditional review creates, including destroying morale, killing teamwork, and hurting the bottom line, for starters, Vigil says.

Melissa Vigil, Chief Administrative Officer, Northwest Community Credit Union

Coaching The Players

NWCU now expects its managers to be more like player coaches, working without offices in the branches, for instance, while observing, instructing, and providing performance feedback on a frequent and consistent basis.

Every manager also has a monthly dialogue with each employee, something scheduled and on the calendar and no less than a half-hour, to have a high-level discussion regarding their professional development plan, long-term goals, and aspirations, Vigil says.

That development path also might include an exit plan. Managers no longer store up performance deficiencies for a year and dump them on a sometimes unsuspecting staffer. Instead, if someone isn’t working out, the manager can show them another path.

This method, this ongoing conversation, helps support people seeking another opportunity, Vigil says.

She pointed to a recent situation with an under-engaged employee who wasn’t working out.

He was willing to give us his all while he looked, Vigil says. And we were happy to help him while he found his new path.

That kind of openness helps avert the unpleasantness that can occur in the absence of ongoing conversations and eliminates surprises about unmet expectations.

Don’t reinvent the wheel. Get rolling on important initiatives using documents, policies, and templates borrowed from fellow credit unions. Pull them off the shelf and tailor them to the credit union’s needs. Visit Callahan’s Executive Resource Center today.

To further underscore the value of APM, Vigil points to a report that looked at 40 lawsuits over firings in California, 39 of which were decided against the employer.

It found managers were not good at rating employees, Vigil says, And many of those employees had years and years of positive evaluations.

Managing The Managers

Vigil says the transition from traditional evaluations to APM was not a hard sell, but managing some managers has been a challenge.

We’ve learned to hire the right managers by asking situational questions, such as how they would go about ranking a team of employees, she says.

Managers and line staff alike also have goals in place that are part of what managers consider when they use the pot of money they get each year for raises.

When your employees know at all times how you view them and how they are performing, that transparency creates an ongoing, flowing type of relationship that’s beneficial to everyone.

Employees talk, you have to expect that, and they know who got what, Vigil says. And if we see a manager give everyone the exact same increase, that’s a sign to us that things aren’t going the way expect them to. We have to make sure our managers know it’s OK to value each member of the team differently.

Because of APM, managers have helped employees find opportunities in other departments as well as given promotions in their own department that wouldn’t have happened if it weren’t for the collaborative work on each individual’s progress.

I think that’s where we’ve been perhaps the most successful, Vigil says.

Overall, she adds, workplace climate surveys are showing NWCU employees realize their performance is now more tied to how they’re rewarded, and they’re becoming more satisfied with their relationships with their managers. Plus, they’re feeling more valued in general.

According to Vigil, the APM system is a work in progress, with new tools and guidelines evolving each year, but the overarching principle has been proven.

When your employees know at all times how you view them and how they are performing, that transparency creates an ongoing, flowing type of relationship that’s beneficial to everyone, she says.

This article originally appeared on CreditUnions.com on February 29, 2016.

APM At Work

Active Performance Management isn’t just the annual review more often, it’s a whole new approach. The strategy outlined below has helped Northwest Community Credit Union move employees to better-suited jobs and eliminate surprises about unmet expectations.

Active Performance Management Components

  • Better Employee Conversations More Often
    • More effective conversations open the door to building relationships between managers and employees which leads to more engaged employees.
    • The overall evaluation of an employee is easier to accomplish when more frequent conversations happen.
    • More frequent conversations make it easier to track and document performance.
  • Establish Expectations
    • Communicate clear goals and performance expectations.
    • Ensure employee understands expectations by observation or seeking feedback.
  • Provide Consistent and Frequent Performance Feedback
    • Establish frequency of performance feedback through discussion with your Director or ELT (daily, weekly etc.) depending upon various circumstances associated with work type.
    • Provide employee performance feedback which is communicating specific, observable behavior that is either measurable or objective that acknowledges positive behavior and corrects negative behavior.
    • Provide employee coaching, as needed, to develop the employee. For example, in team sports, the coach develops their players through mentoring, providing tools, encouragement, reward, discipline, opportunities and education.
  • Formal Coaching
    • Meet with the employee to coach them on specific performance, behavior style traits or professional development. Use Credit Union established coaching tool.
  • Documenting Performance Feedback Methods
    • Log performance using the Human Resources Information System as described in Attachment A
    • Send email to employee and/or self to confirm performance conversations, as needed, to clarify or use to remember the conversation.
  • Corrective Discipline
    • Identify if corrective discipline is needed when feedback and coaching are not achieving the desired result. Do not ignore unsatisfactory performance. Discuss performance issues with your ELT or HR to determine appropriate discipline level (verbal, written warning, etc.).

You Might Also Enjoy

  • Performance Management That Puts Staff In The Driver’s Seat
  • 3 Must-Haves For Every Credit Union Annual Report
  • Ditch The Overly Objective Annual Review
  • Changing The HR Culture, One Coaching Session At A Time
August 15, 2016

Keep Reading

View all posts in:
More on:
Scroll to Top
Verified by MonsterInsights