The Skills Matrix and Performance Evaluation on Agile Teams

For a few years now I have been working with managers and executives to help them do Agile-compatible performance evaluations of their staff.  The method that has been most successful is based on a tool that comes from the book Toyota Talent called the “Skills Matrix”.  The basic approach follows these steps:

  1. Baseline the skills within a team for each team member.
  2. Set development goals and action items.
  3. Regularly review performance in relation to the development goals.

Of course, the details matter.  The OpenAgile Center for Learning has published a brief overview of how to use the Skills Matrix and a convenient A0-size pdf that can be used as a template for a team’s Skills Matrix.  I highly recommend using these to get started.  If you are a manager, ask your ScrumMaster or Process Facilitator to arrange and facilitate a team workshop to do the initial population of the Skills Matrix, rather than doing it yourself.  Once that is done you have a baseline and you should take regular digital photos of the team’s Skills Matrix for record-keeping and as a backup in case of disputes.  You should also let the team know that you will be basing performance reviews on how they improve their skills.

The development goals that team members set then should be made such that every team member understands that they have a responsibility to diversify their own skill set and assist other team members in doing this.  As a manager, you should review each team members’ goals for development and provide mentoring support when needed.  At the end of a fixed period of time (quarterly is a reasonable period), you will review each team member’s development relative to the baseline and the goals set.  Of course, normal guidance around performance (or lack thereof) can be given at these regular reviews.

I strongly recommend reading “Drive” by Daniel Pink as an important adjunct to understanding how to do performance reviews for individuals in an Agile environment.  In particular, individual performance reviews should not be tied to bonuses.  If bonuses are used at all, they should be measured and delivered purely at the team level or organization level without measuring individual contribution.

Of course, Agile team performance can’t simply be measured in terms of skills alone.  Performance must also be related to bottom-line results.  This part of performance measurement is separate from the development of the team.  Another aspect of Agile team performance is how well they are doing Agile itself.  Depending on the Agile method you use, there may be various tools to help with this (I would recommend our new product the Scrum Team Assessment as one possible consideration).

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9 thoughts on “The Skills Matrix and Performance Evaluation on Agile Teams

  1. I don’t believe in this approach. What I believe in is a talk. I talk with people and get know them. We define 1-2 areas that should be improved in the next 6 months, no more. It is a waste of time to create complex matrix and say something “hmm, you should improve these 8 skills”. It is demotivating. Clear focus works much better.

    • Hi Michael,

      Of course talking is important!!! The skills matrix is not just a performance evaluation tool. In fact, it is primarily a tool for the team to use to self-organize. I probably should have made that clear in the article :-) As for it being demotivating, it is only so if as a manager you tell your team members what skills they “should” improve. If team members decide for themselves what skills they will work on, then it can be highly motivating. In your comment you say “Clear focus works much better.”… could you please clarify that comment? I’m not sure what you mean by “clear focus”.

  2. What should one do if a team member does over- or under-evaluate his own skills in the self-assessment? Should there be a discussion inside the team about the self-assessment in order to get good results?

    • This can be a tough challenge. However, there are some things that make this relatively rare and self-correcting. First of all, the visibility of the skills matrix with other team members and management helps people to be honest about their own skills. Additionally, the skills matrix should be reviewed fairly regularly in a retrospective-like setting and in this situation there can be open discussion. Finally, if goals are set to improve a particular skill, it is very easy to verify if a particular level has been achieved. That said, it may be possible for someone to be inaccurate about a particular skill and for that to be unnoticed for some time. Usually in that case, the skill isn’t terribly important for the team. A good coach will also help the team use this effectively (coach can be ScrumMaster, manager, or external consultant).

  3. i ve tried many times to introduce a “skills market” in my teams…it didn’t work..team or team members know what the don’t know and what the know..what is missing is to set the direction towards specific goals…and these “constraints” need to be set in every team by the organization (i don’t like management) so to help grow a self organized team…frequent follow-up to secure that we are in the right directions will help!

    • …by the way…the different phases in skill development is really great!!!..much much better and up to the point than the A B C D T levels that i am seeing….

    • Hi Nikos,

      Thanks for your comment! I hope you let us know if you use the above “Skills Matrix” in your team!

      In my consulting organization, we have introduced the skills matrix to many teams and organizations and it is always a useful tool… as long as it is kept visible! Some organizations (or people) don’t feel comfortable with the transparency that the Skills Matrix introduces.

  4. Improvement in skill happens over a period of time and based on capability of a person, his ability to acquire and demonstrate the same repeatedly. How do you assess the skills and when do you say he has cross the threshold of level -1 and gone to level-2.

    • The unusual aspect of the Skills Matrix is that individuals self-evaluate when they cross the thresholds from one level of skill to another, and they do so publicly. The Skills Matrix is meant to be visible to the whole team and all its stakeholders at all times – posted on the wall! The team looks at the Skills Matrix on occasion, usually during a retrospective. The “boss” does not have a say in how a person does their own self-evaluation. Instead, the team, through the visibility of the Skills Matrix, may self-regulate.

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