Revisiting the Goldman Sachs appraisal process, from a female perspective
Back in April, at the time of the terrible Abacus affair, we were treated to a rare viewing of the self-congratulatory self-appraisals of three Goldman MDs.
Now, however, Goldman's system merits re-examination. As of this week, the firm stands accused of, 'systemic discrimination' against women, and - in particular of -
'constructing and maintaining a system for evaluation employees' performance that systematically discriminates against female professionals.'
The system
Goldman goes for 360 degree appraisals in which the employee, the employee's superiors, the employee's peers, and the employee's reports, all offer their verdict. The Abacus documentation showed that Goldman MDs are reviewed by up to 15 people: 3 peers, 9 seniors, one junior, and 2 'primary reviewers.'
These reviewers rate the employee on a scale of 1-5 and say a few things about their performance. Once it's all over, a computer algorithm adjusts for any anomalies attributable to reviewer harshness/leniency, and the employee's ranked in the appropriate quartile.
Women's accusations about the system
The women bringing the Goldman case claim this system is not good because:
· The outcome depends upon who reviews you and Goldman managers are able to select and deselect reviewers at will.
· Goldman managers can mostly ignore the assessment results when putting people into quartiles anyway.
· Women regularly get more negative reviews.
Immodesty mandatory
The self-appraisals of Goldman's Abacus MDs show that filling in the self-reflective section is all about bigging oneself up as much as is humanly possible.
"On the leadership front I performed exceptionally well over the past year," reflected Michael Swenson, an MD in Goldman's mortgage business. "My ability to assess and manage the risk in the rapidly changing mortgage market has been another tremendous achievement," he added.
Like Europeans, who are congenitally disposed to appraise more negatively than Americans, women are more likely to err on the side of modesty.
Equally, as Kate Grussing, managing director of Sapphire Partners, a search firm with special expertise in placing senior women in what are often flexible roles, points out, women are less good at bragging about their successes and building the kind of network necessary for a good 360 degree appraisal.
"Research shows that women are great bosses and good at managing down, but they can be less aware of the importance of managing laterally and upwards. This can hurt women in systems which depend on feedback from a wide range of people," Grussing reflects.
The problem may not be restricted to Goldman: "The vast majority of banks use 360 degree appraisals," she adds.
Nor may it be totally restricted to men. 360 degree appraisals are coming up for everyone. For both sexes the recipe for doing well is the same: cultivate lots of people who think you're great and write a self-appraisal so laden with superlatives it's liable to fall through the page.
