Tool: Quarterly Conversation and 5-5-5

EOS Quarterly Conversations

Executive Summary:

This document summarizes the key components and best practices for conducting effective Quarterly Conversations within the Entrepreneurial Operating System (EOS). Quarterly Conversations are informal, undocumented discussions held every 90 days between managers and direct reports. Unlike performance reviews or one-on-one meetings, these conversations focus on building trust and human connection by addressing what's working and what's not, centered around Core Values, Rocks (key projects), and Roles. Proper preparation, a focus on betterment, and adherence to a simple agenda are crucial for success.

Main Themes and Key Ideas:

• Purpose and Differentiation:
• The primary purpose is to build a trusted relationship and connect with direct reports on a human level. The goal is increased trust, engagement, and retention.
• Quarterly Conversations are not performance reviews, one-on-one meetings, or documented. They are more informal and focused on broader issues than weekly tactical meetings. "Quarterly Conversations are informal, undocumented, and occur every 90 days. they are different from annual reviews or one-on-one meetings, which tend to be tactical and focus on immediate issues."
• They are taught as part of LMA (Leadership, Management, and Accountability) during quarterly pulsing or when communication issues are identified.
• The 5-5-5 Model:
• The "5-5-5" diagram is a visual tool to keep the conversation focused on the most important aspects of the direct report's work and behavior: Core Values, Rocks, and Roles (including Get It, Want It, Capacity to Do It - GWC). "This graphic is designed to help you stay focused on the most important things: Core Values, Rocks, and Roles. 90% of your expectations are here."
• The center of the diagram is "a human, your direct report," emphasizing the personal connection.
• Preparation is Key:
• Mindset: Approach the conversation from a place of betterment, avoiding judgment, blame, or shame. "Coming from a place of betterment, not judging, blaming, or shaming where We're tough on issues but easy on the person." Be open, honest, and vulnerable, modeling desired behavior.
• Communication: Schedule conversations well in advance, ideally offsite and free from distractions. Clearly communicate that this is not a performance review.
• People Analyzer: The manager conducts a People Analyzer assessment on the direct report (and the direct report does one on themselves) to assess alignment with Core Values and GWC within their roles. It’s not necessary to bring it, but notes are ok.
• Rocks and Measurables: Review past and current Rocks, their impact, and completion percentage (aim for >80%). Tie measurables to accountabilities within roles and assess progress.
• Craft Feedback and Questions: Prepare feedback (what's working, what's not working), focusing on high-level observations. Review the Five Leadership and Five Management Practices with the direct report in mind to evaluate your own performance.
• Conversation Agenda:
• What's Working: Both parties share what's working, reflecting on Core Values, Rocks, and Roles.
• What's Not Working: Identify issues and root causes, asking questions from a place of learning and curiosity. "You want to get into the issues and identify root causes of those issues, but ask questions from a place of learning, interest, curiosity, and caring. Remember, you want to be tough on the issue, but easy on the person." Anticipate three types of issues: those that can't be solved, those the manager must solve, and those the direct report must solve. Use the 80/20 method (questioning vs. telling).
• Next Steps: Agree on actions for improvement. Avoid unsolicited advice. Capture any to-dos or issues for the Level 10 meeting Issues List.
• Accepting Feedback: The manager actively listens to feedback from the direct report without interrupting. Specifically solicit feedback on the Five Management Practices. Ask the direct report: "What's one thing you can do to improve our relationship?" and "What's one thing I can do to improve our relationship?"
• Important Considerations and FAQs:
• Documentation: Quarterly Conversations are intentionally not documented to encourage open and honest communication. "Well, paperwork can interfere with the relationship. Forms and laptops create a grading system which hampers open and honest communication needed to address issues effective."
• Annual Reviews: If an annual review process is already in place, one of the Quarterly Conversations can serve as the annual review. If not, don't mandate it.
• Three Strikes Meetings: A Quarterly Conversation should not turn into a Three Strikes meeting (formal meeting addressing serious issues potentially leading to termination). If a direct report's job is in jeopardy, conduct a formal Three Strikes meeting instead, with documentation and witnesses. "A quarterly conversation is an informal off-site conversation designed to build trust and human connection. A three strikes meeting is a formal meeting for addressing serious right people right seat issues often leading to termination."
• Direct Report Preparation: The direct report should complete a People Analyzer on themselves to develop self-awareness. They can also prepare by considering what's working and what's not. They can optionally do a People Analyzer on their manager to inform feedback.
• Handling Difficult Conversations: If the conversation goes "haywire," refocus on Core Values, Rocks, and Roles. If necessary, take a break and reschedule. "If things go completely haywire, take a break, take a pause, and come back and do the quarterly conversation in the very near future."
• Legal Compliance:
• Managers should comply with all local employment laws when discussing feedback and consult legal counsel if they have questions about regulations.

Core Components and Visuals

• LMA
• IDS
• The 5-5-5
• Rocks
• Core Values
• Roles
• GWC
• People Analyzer
• V/TO
• Level 10 Meeting
• The Five Leadership Practices
• The Five Management Practices

Expected Outcomes:

When done well, Quarterly Conversations lead to:

• Increased employee trust
• Increased employee engagement
• Improved employee retention
• More effective communication
• A stronger team dynamic

This briefing document provides a framework for understanding and implementing EOS Quarterly Conversations. By focusing on preparation, open communication, and a commitment to betterment, organizations can leverage this tool to build stronger relationships and drive better results.

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