Coinbase is testing a real-time employee feedback system. It looks rough. – Tech Crunch

Crypto exchange Coinbase is testing a real-time workplace feedback tool called Dot Collector, created by hedge fund billionaire Ray Dalio, founder of Bridgewater Associates.

Do you relax your colleague to say hello? Perhaps you will be considered out of task. Talking too much in meetings? You will get a low efficiency rating. Tired after a night awake with your sleepless toddler? This is a low enthusiasm rating. At any time of the workday, you can grade and be graded, watching your scores fluctuate up and down.

According to a report by The Information, Coinbase has been using Dot Collector since the first quarter of the year, mimicking a less intense version of Bridgewater’s practices.

Dalio is known for promoting a culture of “radical transparency” in Bridgewater. The fund is known for filming almost everything that happens in the office for reference, and employees walk around with iPads to gauge their adherence to the Dalio Principles, a set of more than 200 rules for business and life.

With the Dot Collector program and the Zoom plugin, any company (like Coinbase) can invite its employees to judge everyone’s performance in real time, even while working remotely.

“It’s hard to have an objective, open-minded, unemotional conversation about performance if there’s no data to discuss. It is also difficult to track progress,” Dalio wrote in a Tweeter on the product. “That’s part of the reason I created the Dot Collector.”

But this data-driven, “emotionless” approach to management ignores the humanity of the people behind the products.

Picture credits: Point Collector/YouTube (Opens in a new window)

Feedback fatigue

Using Dalio’s Dot Collector app, Coinbase employees rate their co-workers on their adherence to Coinbase’s cultural principles, which include “Positive Energy”, “Effective Execution” and “Communication clear “.

An assistant professor of management at the Wharton School, Samir Nurmohamed, told TechCrunch that there hasn’t been much research conducted on these types of feedback systems — but if a system works in a workplace, it does not guarantee that it will translate effectively into others. . Additionally, different workplaces and industries have different standards for unsubscribing. At Bridgewater, 30% of employees leave within 18 months of their start date. While Dalio might agree with that, other managers might find it concerning.

Bridgewater aims to “champion diversity”, but Nurmohamed says that in the workplace, people are more likely to think favorably of people who share similar views, which can impact how they work. evaluate their colleagues.

“So if people from marginalized backgrounds make comments that don’t align with my own values ​​or ideology, I might suddenly penalize them when it comes to these rating systems,” he explains. “The question then becomes, how are these ratings reviewed? If there is systemic bias at all levels, how will they assess this data? »

Proponents of Dot Collector argue that the system levels the playing field because it allows lower-level employees to provide honest feedback to managers. But this transparency comes at the cost of constant monitoring.

“From a managerial point of view, it could be useful, right? We know that sometimes those with more power are more likely to dominate the conversation in meetings, rather than listening,” says Nurmohamed. “But those with less power are already worried about the kind of impression they give off. This could induce a sense of fear in the organization.

These systems can also cause a sense of “feedback fatigue”, where workers become unresponsive to criticism and are less likely to benefit from such constant feedback.

“Sometimes people are just having a bad day – something went wrong at home last night, or maybe it’s a virtual meeting and their tech wasn’t good,” adds Nurmohamed. “It can be very exhausting for people at work to constantly get that feedback.”

Point Collector on Zoom

Picture credits: point collector (Opens in a new window)

“A Cauldron of Fear”

Dalio credits Bridgewater’s unique and divisive corporate culture with the secret to its success – its hedge fund is the largest in the world. Coinbase is also known for its corporate culture, which controversially prohibits employees from engaging in political activism.

In June 2020, a group of Coinbase employees staged a walkout in response to CEO Brian Armstrong’s refusal to support Black Lives Matter. Then, a few weeks before the 2020 US presidential election, he instituted this apolitical policy and offered severance packages to those who did not want to stay.

At Bridgewater, Dalio’s “radical transparency” isn’t always effective in practice either. In one high-profile case, an employee filed a complaint against the company, calling it a “cauldron of fear and intimidation”. It doesn’t seem too surprising a description of a workplace where workers are given iPads for the explicit purpose of judging one another.

According to a 2016 report from The New York Times, this employee claimed to have been sexually harassed by his supervisor, but kept it a secret for fear of not being promoted. He suddenly withdrew the complaint jointly with Bridgewater, but the National Labor Relations Board later filed a separate complaint, arguing that Bridgewater prevented employees from talking about negative treatment because of the strict confidentiality agreements they sign during the ‘hiring. Bridgewater reached a resolution with the National Labor Relations Board over the complaint, but like most of what happens at the hedge fund, the final agreement is secret.

Dalio denied these claims, noting that “If Bridgewater really was as bad as the New York Times portrays it, then why would anyone want to work here?” (Money, probably.)

“It might sound mean or crazy or like a cult to people who don’t know what it really is,” Dalio told Business Insider in 2016. “Some people describe him as being like an intellectual Navy SEAL. others describe it as being like spending time with the Dalai Lama for self-discovery.To me, it’s a wonderful community of people who work their ass off to be great.

Whether or not Coinbase will continue to use Dot Collector is still up in the air. For now, companies using the tool must decide whether they hope to emulate Bridgewater – a profitable but intense business – or hone in on a culture where employee happiness is a priority.

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