Should we get rid of Annual Performance Reviews?

Should we get rid of Annual Performance Reviews?

My answer is Yes. Yes, to the traditional method anyway. Let me explain.

If you’ve spent any time on this blog or listened to my podcast, you’ve likely heard me state …

“As much focus needs to be on the employee experience as the customer experience. The employees make the magic happen. They need to feel, understand, experience and believe the promises companies make to customers in order for them to deliver on them. They need to feel the love in order to sell the love.”

Annual reviews are frequently addressed in the employee experience. When employees have negative experiences in the review process, there will be challenges in their ability to truly engage with the company values and beliefs.

Performance Reviews have been around since the early 1900’s and are used in most companies today. However, I believe they have fallen into the “we’ve always done it this way” category of business.

Managers and staff who look forward to annual performance reviews are few and far between. Most approach them with dread and obligation. Because the manager may not have any real investment in what they say, and the employee may have no desire to change (especially not when criticized), the entire process becomes a charade according to Samuel Culbert.   The way Culbert sees it, the performance-review dynamic is inherently doomed by the opposing goals of the manager and the employee.

Why performance reviews don’t work…

Managers don’t want to actually do them or know how to do them. It’s common for companies to use a performance review software program with the intent of consistency companywide. The downfall is most don’t properly train reviewers on how to use the program to deliver an effective review. Many managers just go through the motion, click the requisite boxes and try to come up with some generalized comment to support the boxes they’ve clicked.

Employees view reviews negatively as they are being told what they’ve done wrong throughout the past year. Often, many employees are surprised to know that things they’ve done were an issue as there was no discussion about it at the time. Criticism is usually not well received, even by the best of employees.

Reviews are subjective and one-sided. Typically, the manager of the department is charged with delivering reviews to everyone reporting to them. Thus, the review will usually only hold one perspective and viewpoint. Also, most reviews are given in a reporting out manner, not as a two-way communication tool to review the previous year and setting goals to achieve in the next year.

What to do about it…

Many companies are doing away with annual reviews entirely. I think that may be

Have regular review meetings. Effective managers know their employees. Regular meetings build working relationships based on trust and intent for success. Biweekly or monthly meetings with each employee allow managers to understand the current project priorities, the challenges the employee may be having, and to offer guidance where needed.

Ask appropriate questions about their personal lives and goals to know about them as people. Managers who know about their employees as humans with lives, challenges, talents, dreams, and goals are better able to build loyalty and tap into the strengths of their team. 

Ensure two way communication. Rather than only being told what is wrong with a project or outcome, have collaborative discussions around why the results fell short, root cause, and what could have been done differently along the way with hindsight being 20/20. Many employees feel they aren’t being heard during the review process. 

Craft plans for improvement. Managers should be focused on coaching their team to success. When employees struggle, management should become involved to identify challenges set up a plan to coach for improvement in those the specific issues. 

Set development or career goals. Understand the priorities of each team member. Some may view their current role as one they’d like to be in for the next few years, others may see it as a stepping stone to something greater. Learn the goals of each member and set a plan to guide them to their goals.

Hold short quarterly reviews to summarize progress- or lack of – in the areas stated above. This helps document progress throughout the year and may help identify points where issues may have developed.

Conduct annual reviews simply to serve as an official marker of progress in the development or progress goals already established. Documentation is necessary to support both negative and positive actions on behalf of management and employees. If regular meetings are being held with open communication with the intent to guide to success, the annual review will hold no negative surprises. The trust built throughout the year through discussion and collaboration facilitates agreement and engagement by all parties.

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