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Managing performance in agile teams

December 11, 2021 - 11 min read

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3 types of teams

Creating psychological safety in teams

Performance management in agile teams

Creating a self-service performance management system

Work — and the workplace — has been transforming for quite a while. The rapid switch to remote work got our attention, though. And the growing pains as we all feel our way forward toward a more flexible future workplace has served to make all of us more aware of what work is and might be.

One concept which has been being totally revamped is that of the team. Rather than the traditional top-down teams, knowledge-intensive organizations are reformulating this concept to better fit their fast-paced environment.

The great thing is that there is not one, but several models which are being adapted to fit the needs of the organization. Customization and experimentation are key, especially in a hybrid future.

Graph depicting network of teams from Deloitte.png

Source: Deloitte University Press 

The unique characteristics of these new types of teams mean they don’t necessarily fit into standard HR processes, particularly the annual performance review. Traditional top-down reviews were created for static teams. It worked for teams where managers, peers, and reports generally stay the same — and at the end of the year, performance is assessed. 

The challenge for HR will therefore be to redesign the performance management process so that it can be adapted for each team’s needs and support people enablement. Amid this changing world of work, we’re seeing commonalities in the types of teams being formed.


3 new types of teams 

1. Self-steering team 

The main idea of a self-steering team is to increase agility. One of the most important parts of this is keeping decision-making at the team level. Rather than having to wait for approval, these teams have the ability to act fast, which facilitates a more flexible response to changes.

For a self-steering team to function properly, these changes in direction require flexibility in ways of working and setting goals. Sharing feedback on a regular basis can create greater clarity and alignment between team members, ensuring everyone stays on the same page.

2. Cross-functional teams

These teams consist of people with different areas of expertise. This enables each individual to leverage their strengths, supporting the more efficient accomplishment of team goals all while facilitating knowledge-sharing.

For example, Spotify has allowed people to organize into self-steering squads, each with their own long-term mission and ways of working. With everyone bringing a different skill to the team in order to reach a common goal, feedback is key, not only from team leads, but also from peers.

3. Ad-hoc teams

These teams form and disband as needed. For example, they could be formed to work on a specific project or address a certain issue. It might also be that some people float from one team to another, changing team dynamics.

For example, gaming company Valve is famous for allowing their employees complete freedom to form and move between groups based on their interest in a project. This allows for greater flexibility and alignment with areas of interest for professional development.

Put into context of conversations with managers and their direct reports, this becomes even more useful for setting goals as well as identifying learning and development opportunities.

Creating psychological safety in teams 

According to Juan Castillo, scrum master and agile coach, no matter what type of team you have, psychological safety is the most important element you need for it to be successful. The term was originally coined by Harvard Business School Professor Amy Edmondson and later found to be the top quality needed for a successful team during Google’s Project Aristotle.

It can be difficult to build as safety requires trust, which can only come into play when people feel comfortable sharing ideas or raising concerns without being judged. But in the long term, teams and individuals will benefit from working in a psychologically safe workplace.

So how can HR create a performance management process that fits the needs of these new types of teams, all while fostering trust?

Performance management in agile teams 

Rather than trying to fit these types of teams into a traditional performance management process, allow them to customize it to match the agile processes they are embracing. By enabling autonomy, organizations will actually help their teams to work in faster, more efficient ways

A classic feature of agile teams is working in sprints, which are usually no longer than four weeks. At the end of each sprint, teams complete a retrospective in order to determine what worked and what didn’t as a way to continuously improve.

Adapting the performance management process to match this way of working could include a number of activities: 

  • Sprint or project-based performance reviews led by managers. Using a purpose-built platform gives team leads the flexibility and power to set up reviews on an as-needed basis in minutes — eliminating hassle.
  • Request feedback at the end of a sprint. The best people to receive feedback from are those you work with most closely. Allow your employees to take ownership of their development by giving them the ability to request feedback from their team members, either during the official review or on an ad-hoc basis.
  • Real-time feedback. Agile organizations present a unique opportunity for upskilling and growing your talent organically. Make the most out of this by facilitating the exchange of real-time feedback outside of performance reviews. Colleagues can share praises and tips with each other at any time, increasing opportunities to learn.

As teams share and gather feedback on a more regular basis, this also gives you better insights into how teams are performing across the organization. You will also be able to see patterns emerge on how teams impact one another.

Meanwhile, gathering more frequent performance feedback allows managers to make their teams more efficient and get the most out of individual contributors, as is the point with running retrospectives.

To ensure these habits become ingrained across teams, this should start at the top. As Castillo shared, he regularly asks his team for feedback after retrospectives to see how they can be improved. Leading by example helps show the rest of the team it’s OK to ask for, and receive feedback.

In case some team members (or even whole teams) are remote, don't forget to take that into account. When doing performance management with remote employees that are working agile, certain aspects of the process like performance reviews will differ. In such scenarios, you should also evaluate people on the necessary soft skills for remote work that can also be improved with feedback.

Last but not least, a major part of creating a successful and comfortable environment is by taking time to celebrate success as a team. Let people know that their hard work won’t go unnoticed.

Creating a self-service performance management system 

While teams should be given the flexibility to choose the performance management style that works best for them, there are two things HR can do to facilitate this:


Create core competencies which will help you align and compare team performance across the organization. Likewise, having a library of skills and competencies will set the standard for new leaders learning how to best guide their teams.


Find a platform that allows each team to customize and work effectively with their own processes, and enables Managers to drive more continuous feedback and learning opportunities.

Next steps 

Using one platform across your company allows you to collect, analyze, and compare the performance of different teams on core competencies. Use this data to gain insight into the health of your teams. There is no “one-size-fits-all” performance management process. Instead, it’s time to build an agile process that empowers managers to remain flexible to the needs of their agile teams.

Learn how to evaluate what are the most important areas to focus on for the various teams across your organization, and how to build your processes to enable your people with our latest resources and research.

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Published December 11, 2021

Maggie Wooll

Managing Editor

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