The Poker Chips Feedback Experiment

The Poker Chips experiment gave us a whole new level of transparency, communication, trust and performance. So much that I strongly recommend every team to try it and sustain it, but before I go into details, I must set the right context so you understand where we were coming from.

After we ditched the hierarchy and moved to a self-managed environment, we had to experiment with a lot of innovative practices to cope with the gaps that the lack of structure left us. Our teams are used to come up with many democratic approaches to make decisions and implement processes. The methods that we’re going to describe in this post need to be put in this context and must be carefully used in groups with little experience with transparency and honest feedback. For us, after 3 years playing with democratic approaches, the Poker Chips feedback was just one more thing we were trying.

One of the things that nobody was controlling in our structureless model was to make sure that everybody was doing what they were expected to do and that nobody was taking advantage of the system or derailing from the values and work required for the company to sustain its culture and achieve its business goals.

We experimented with lots of performance review exercises. To get a better context read Experiment 1, Experiment 2, Experiment 3, Experiment 4 and Candies Feedback Experiment.

If you haven’t read our previous experiments, this is a brief summary to help you get in context. We tried different ways of giving promotions by selecting the best employees democratically. We played with surveys, voted by categories and even delegated the promotions budget to the group for them to distribute but it was the Candies Exercise the one that took us to this new Poker Chips experiment. The Candies feedback, in short, is an exercise in which every team (as a whole) provides feedback to every other team (as a whole) and, additionally to the written feedback, a number of real candies is also given as a sweet rating of their performance. Typically the teams would collect those candies and all team members would share them and enjoy them together. It is important to say that the candies exercise wasn’t linked to money or promotions in any way but rather open and transparent feedback for the teams to understand how they were perceived and how they could do better.

One of the risks when creating self-managed teams is that having all members the same hierarchy can be confused with not having the right to demand accountability from others. To some degree, there is this feeling of “we are all the same and nobody can tell me what to do” or just not feeling comfortable with confronting anyone without having any real authority over that person. The way we see it, in a self-managed model, everybody has the authority to demand accountability to others, but of course, not the easiest thing to understand or do.

With this method, we make sure that everyone is aware of how they are perceived and what they need to do to improve that perception. Coming from the Candies Exercise, when the candies were collected, we raised the question to the teams “do all members of the team deserve an equal amount of candies?” or “have all contributed equally to this team?”.

pokerchips.jpeg

We had some poker chips laying around from other workshop exercises so we decided to use those. We directly converted the number of candies received by the team into the number of 1$ coins they could use, and that would be the currency we would use for this feedback exercise.

If you wanna run this exercise from scratch you can decide the number of coins following a formula like this:

c = m * n + e

  • c is the number of 1$ coins per person for the exercise.
  • is the number of team members.
  • n is a variable to control the magnitude of variation. The bigger it is, the bigger gap will create between the best rated and the worst rated members.
  • e is there to avoid an equal distribution by forcing every member to decide who gets extra coins. e must be between 1 and m, the closest to 1 you would foster recognition of performance above average, the closer e is to m, you would be fostering punishment for lower than average performance.

 

We applied the following format to mature teams, with lots of experience in providing feedback. This is how it would work for a team of 5 members:

  • m = 5, n = 2 to avoid big differences in rating and e = 1 to foster positive recognition. c = 11.
  • Get all team members together in a friendly environment. It can be a playroom, the park or the bar. Whatever works for you.
  • Each member will get 11 coins of 1$ each.
  • In turns, each member will distribute their coins to all the teammates, giving to each one, a number of coins and the justification for it. This happens face-to-face and in front of everyone.
  • Once everybody distributed their coins, we compute the totals and write down the results on a board or a screen for everyone to see.
  • Give some time to reflect on the results and encourage everyone to share their thoughts by asking questions such as “are you surprised by these results?”. Also, encourage team members to ask the group “how can I improve to get a better result next time?”
  • Repeat this exercise often, every 6 to 12 weeks, identify trends and ask the team to define a plan that helps all team members help each other improve. It is ok and normal to have people outstanding but watch out for big differences of results or team members with recurrent low results.

 

Bonus: you can consider linking this to your appraisal process. In our experience, when you add money to the mix, you compromise the feedback but it sure can be a great way of running performance reviews for mature teams.

Proceed carefully! This is exercise can raise sensitive conversations and can be very awkward for an inexperienced team, potentially damaging the team moral and personal relationships. Add variations to the above format to reduce the impact if necessary. You can play with different degrees of anonymity. Start safe and send out an anonymous online survey first, where members can give each other feedback privately. Collect all the feedback given and have it discussed by the group without disclosing authors. After some sessions like that, when the team is ready, introduce the coins and just ask team members to put the coins in a box or behind the teammates’ back while seating in a circle on the floor. Eventually, with more experience, gradually open it up until you reach full transparency and one-to-one communication. Do not link this exercise to money or promotions if the team hasn’t practiced it before and feels comfortable with it.

circle

In conclusion, this exercise is extremely powerful. It keeps everybody aware of how they are perceived in the team, allowing them to continuously improve upon feedback and making sure that all team members are meeting the team’s expectations. Running this exercise we had cases where low performers who would have been terminated overtime, had the chance to react and become valuable members of the team. We also had cases were low performers were never able to match the team’s expectation and had to eventually leave the team. Equally, we had cases of people constantly getting the highest scores in the team and that’s usually a great indicator for the team to consider proposing that member for promotions or salary increases. We consider that mastering this exercise is essential for the success of our teams.

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