Saturday, December 19, 2009
Note: The post below is based on my personal experience with a big auditing firm. What I am relating may or may not be applicable for other Big 4 auditing firms. Please feel free to leave your comments and any thing you want to add about this topic. I am really interested in hearing from other auditors as not much seems to be written on this topic.
I came upon this article by Francine McKenna on ratings and promotions in the Big 4. Two words caught my attention: “Forced Ranking”. According to Ms. McKenna, the Big 4 firms have seemingly become advocates of this performance rating where everyone’s performance is compared with everyone else.
Frankly speaking, this was the first time I’ve read about this forced ranking concept (although I understand it has been around for quite some time now. The above article made me remember my years in an auditing firm. I stayed for 8 years in the firm but I never actually realized that there was anything “forced” about our rankings (although, upon reflection, yes it is ‘forced ranking’).
Out of the 8 years I spend in the auditing firm, 5 of those were spent evaluating and ranking my juniors and later on, my seniors. Every time the busy season ends, another season begins – the pre-ranking, pre-promotion, evaluation season. In a nutshell, here’s how this evaluation and ranking goes:
First, we evaluate and rate each of our juniors and even, seniors while our managers and partners also rate us.
This is the time when we fill up a couple of pages worth of checklist plus put in our comments regarding the junior’s or senior’s performance for the last six months (kind of like having a trip down memory lane because you really have to remember the basis for your comments). The evaluation ends when we put in our over-all assessment of the junior or senior.
Second, we discuss the said evaluation with our junior or senior.
Sometimes, if we’re too busy with other jobs (they never really end, even during the ‘slack season’), there’s no face-to-face discussion involved. We just let them read our comments and if they have any questions, they will come to us. If they have none, then we’re okay. And sometimes, really, the person we are commenting on is just interested on his or her over-all rating. The comments? Read on.
Third, submit the evaluation to the partner for his / her review, comments and reference. The partner may also add other comments, refute some of the ratings and even change the over-all rating of the junior or senior.
Fourth, hold a meeting with other seniors and managers. This meeting is where our ‘forced ranking’ occurs. We rank each junior or senior according to their level or ‘batch’. Such a meeting takes anywhere from 2 hours to 6 hours, depending on the number of people we have to rank.
Fifth, submit everything to the partner and to the HR for final approval and future reference.
Sounds easy? NOT! On paper, yes, but definitely in practice, it’s a resounding NO. The reasons? You have to check out my next post on that.