Newspaper article International New York Times

Wall St. Firm Stops Rating Workers on 1-to-5 Scale

Newspaper article International New York Times

Wall St. Firm Stops Rating Workers on 1-to-5 Scale

Article excerpt

The Wall Street firm said it was overhauling performance evaluations in several ways, one of which is discarding a numerical scale.

For years, Morgan Stanley employees were graded in part on a numerical scale that rated them from one to five.

Now, the Wall Street bank plans to change those evaluations -- by taking away the numbers.

Morgan Stanley told its staff members on Thursday that it was overhauling how employees are assessed in several ways, one of which is discarding the number scale in favor of lists of up to five adjectives.

The changes are the latest effort by a stalwart of corporate America to change how it evaluates employees. Some companies, like Microsoft and Morgan Stanley's longtime rival Goldman Sachs, have made their own changes, which have also included getting rid of numerical ratings.

Others, like the consulting firm Accenture, have decided to do away with the annual performance review altogether. To these companies, the ritual proved wasteful and ineffective.

For Morgan Stanley, annual reviews are still helpful in determining how well employees do their jobs. But the system -- in which staff members were asked approximately eight questions and ranked, in addition to being questioned about "areas for development" -- was in need of a change.

Evaluators will now be asked to list up to five adjectives that describe the employees. The aim is to give more direct feedback and better steer staff members toward areas of improvement.

"It's about giving people more information and something they can do more with," Peg Sullivan, Morgan Stanley's global head of talent management, said. "It's more candid and memorable."

Morgan Stanley will also put in place a so-called dashboard that compiles all the information needed by supervisors to evaluate employees -- like measures of their behavior and data from risk and control functions -- in one place. …

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