Benzinga - In a bid to transform company culture, Block Inc. (NYSE:SQ) CEO Jack Dorsey has announced a new approach to performance management and named a new Chief Technology Officer. The company plans to eliminate annual performance reviews and performance improvement plans (PIPs).
What Happened: Dorsey relayed his aim to foster a “culture of excellence” at Block in a staff memo, Business Insider reported. The company will halt its tradition of annual performance assessments for workers following the forthcoming review round.
Dorsey has also designated Dhanji Prasanna, a Block veteran and the firm’s chief scientist, as the new CTO. This move comes on the heels of Dorsey’s announcement of an impending 10% workforce reduction in the next few months.
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Regular employee evaluations will supplant annual reviews, targeting the elimination of the notion that Block permits its workforce to “‘rest and vest’ throughout the company,” according to Dorsey. Staff failing to meet expectations may be let go immediately, sidestepping formal feedback or performance improvement strategies.
Starting next year, Block will implement performance ratings of “meet, exceed, or fall below”, and every employee will have access to their rating. Dorsey believes this will ensure “a fair two-way conversation holding each of us accountable to always raising the bar.”
Why It Matters: These changes come at a time when Block has been performing exceptionally well in the market. The company saw a 37.5% growth in Bitcoin revenue to $2.42 billion from the previous year, as well as a gross profit of $44 million derived from Bitcoin in Q3. This exceptional performance was followed by a significant surge in the company’s share price.
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