Microsoft Corp. (NASDAQ:MSFT) has rolled out a new employee performance evaluation system, visible only to managers, according to documents reviewed by Business Insider.
Coining the term “impact descriptors” for these new ratings, Microsoft aims to determine employees’ compensations and bonuses based on these evaluations. The tech giant emphasizes that these ratings are not to be used as labels or directly communicated to employees.
The descriptors include “Lower Impact Than Expected (LITE),” “Slightly Lower Impact Than Expected (SLITE),” “Successful Impact,” and “Exceptional Impact.” These ratings are designed to evaluate employees’ performance, growth mindset and adherence to Microsoft’s cultural values.
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Managers are encouraged to use these descriptors while providing feedback, but not as labels or acronyms. The system is intended to provide clarity and consistency in determining rewards and performance feedback.
This new rating system was introduced following a year when Microsoft imposed a freeze on salaries and reduced budgets for bonuses and stock awards. The company advised managers to not discuss these budget cuts during performance reviews.
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