The Most Wonderful Time Of The Year, Part 1

Feedback is important.

While you might not always agree with what someone else is saying, you should at least always listen. Insightful feedback is a gift, and you should treat it as such.

As a person in any sort of position of leadership, the giving of feedback is one of your most important responsibilities. Being directly responsible for the professional growth of the people that you work with, you should treat giving feedback with the appropriate amount of care, diligence, and respect.

And one of the ways that you can do that is by giving high-quality and meaningful annual reviews.

There'll Be Time For Reviewing

I want to get one thing out of the way first: annual reviews are just one slice of the feedback pie. Alone, they are far too infrequent to help someone grow to their fullest potential.

One of the key elements of good feedback is that it is timely, and if you're waiting for an entire year to give someone feedback on how they are going, then you are doing it wrong.

But that doesn't mean that they aren't valuable.

A good annual review will coalesce an entire year's worth of victories, failures, lessons and growth into an easily digestible artefact. It will summarise major points and give clear directions for the coming period, allowing the recipient to narrow down their focus to a few improvements that will, ideally, make the most difference.

More importantly, an annual review is a great opportunity to evaluate compensation because it provides a natural boundary and tends to align with the concept of a financial year.

I'll be honest, talking about compensation once a year isn't really good enough either, but sometimes you have to work within the systems that are available.

Speaking of which, Atlassian has a very mature annual review process called OneCycle.

When I first started at Atlassian I got to see my manager gracefully dance through the process like the pro that he is, providing high quality feedback to all of the people that I was now responsible for.

During that time, I learned a lot and it helped me to set appropriate expectations on myself for when it was my turn.

But before I get into the rabbit hole of my own experiences, let's talk about how annual reviews work at Atlassian.

Performance For Viewing

Atlassian provides a lot of guidance when it comes to the annual review process. The biggest piece is the process of using a set of common performance indicators to evaluate the people you're responsible for.

These performance indicators are broken down into three main dimensions, each focusing on a different aspect of what it takes to be successful at Atlassian.

The first dimension is values, which covers off how well the person aligns with the Atlassian values.

For those of you who don't feel like clicking on that link, the values are:

• Open Company, No Bullshit
• Build with Heart and Balance
• Don't Fuck the Customer
• Play, as a Team
• Be the Change You Seek

I know, I know, they seem like stock standard corporate constructs, but Atlassian is the only company I've ever worked at where the values are actually used to drive behaviour and make decisions. Of course, it helps that they align pretty closely with my own values.

The second dimension is role and it, unsurprisingly, covers off whether or the person is delivering on the expectations of the role that they are filling.

Each role at Atlassian generally has a growth profile associated with it and for engineers, this profile is broken down into four areas: master the craft, drive outcomes, lead & inspire, and have customer impact. There is a lot of detail within each of those areas that I'm not going to get into here, but suffice to say there is more than enough to help evaluate someone in this dimension and generate appropriate feedback.

The last dimension is team and I'm sure you can guess what it is all about.

It's a measure of how well you're supporting and driving those around you, which is important at all levels of seniority. It doesn't matter if you're a graduate developer fresh out of university or a senior principal engineer with hundreds of thousands of hours of painful experiences under your belt, supporting and growing those around you is ridiculously important.

Especially at Atlassian.

Lone wolves are all well and good, but they are nowhere near as valuable as someone who goes out of their way to uplift their colleagues.

Values, role, and team.

Those three dimensions help you, as a leader, evaluate the people you're responsible for and come up with appropriate feedback to help them grow.

But an annual review is not just about feedback.

And Ratings That Sum It All Up

Part of any sane evaluation process is some sort of rating. A summarisation of all the things, useful to contrast and compare people across the board and as an input into compensation adjustments.

As a result, when doing an annual review, each of the dimensions (values, role and team) must be summarised with a rating.

For values there are only two ratings:

• Consistently applied the values and exemplified the behaviours that support them
• Inconsistently applied the values of demonstrated behaviours that are in conflict with them

For Atlassian, it's not about the degree to which you show the values, it's about whether or not you do. That's how important they are.

You can't be amazingly open and communicative yet constantly ignore customer needs and desires and still be successful.

That's just not how it works.

For role there are three ratings:

• Delivered beyond the expectations of their role, and regularly contributed exceptionally high-quality work that meaningfully impacted the customer
• Delivered on the expectations of their role, and regularly contributed high-quality work that meaningfully impacted the customer
• Didn't deliver on the expectations of their role, or didn't regularly contribute high-quality work that meaningfully impacted the customer

Like I said in the section above, it's all about whether or not you're delivering to the expectations of the role, and the rating represents that. As you can imagine, exceeding expectations in an organisation that sets a high bar can be quite challenging.

For team there are also three ratings:

• Drove the success of their team and elevated the impact of their teammates
• Contributed to the success of their team and helped their teammates achieve impact
• Didn't contribute to, or may have detracted from, the success of their team and teammates

Similar to the role ratings, there are three obvious levels and the top one is all about going the extra mile, about pushing the boundaries and really making a difference.

Rolling it all together, the three ratings combine into a single overall rating for the year, which is one of:

• Exceptional
• Great
• Off

The reality is that Exceptional, really does mean exceptional. You have to be smashing it consistently in multiple dimensions in order for that to be your rating.

But there are real rewards for achieving an Exceptional rating.

Exceptional ratings tend to result in higher compensation adjustments, and they have a direct impact on the value of the at-risk component of your compensation package (aka your bonus), by acting as a multiplier.

Great means you're doing exactly what is expected of you. No more, no less. From a compensation point of view, the at-risk component of your salary is pretty much exactly what you expect it to be.

It is by far the most common rating.

But sometimes people just don't manage to meet expectations.

There can be many reasons, so it doesn't necessarily mean that their performance was bad, it was just...off.

Thus, the Off rating.

It's intended to be a strong signal to the person in question that they need to pick up their game. It also means that the at-risk component of their salary receives a negative modifier, dropping in value.

Multiple Off years in a row means harder and harder conversations, but as a leader that's sometimes the reality of the situation, as you have to be prepared for the possibility of that.

It's The Stress-Stressiest Season Of All

So, feedback dimensions and ratings.

Combined, those two things represent the tip of the iceberg on annual reviews at Atlassian. I haven't even touched on how to structure the feedback itself, the concept of proficiency ratings (aka compa-ratio) or the cross-team rating alignment process, but I think that's enough for now.

I'm exceedingly lucky to be able to work for a company that takes the giving of feedback very seriously.

As should be obvious from the abundance of words above, I've got a monstrous amount of guidance to help me generate meaningful feedback for everyone that I'm responsible for.

But that doesn't mean the process is easy.

It's just easier.

I've just finished my very first OneCycle here at Atlassian and I can tell you, in no uncertain terms, it was an exhausting experience.

Or at least, I will tell you, in great detail, next week.