Performance reviews no more? 3 things to consider!

When I first heard of big name companies like Deloitte and Accenture ditching their annual performance reviews, I have to say I became a bit excited! Anyone who has worked in HR or line management – no, let’s make that anyone who’s worked – knows what a pain they can be.

Not only is it the people management task managers often have the most trouble completing. Often to produce results that are at best meaningless. At worst, performance reviews can be destructive, demoralising and unlikely to produce better performance.

Can you tell I’m not a big fan of the traditional performance review?

Yes, that would be true when the emphasis is on ‘traditional’. You know the one I mean. It comes around every 6 or 12 months, it’s 5 pages long, it contains rating scores and there’s a collective groan when it arrives. You complete the form first, then negotiate with your manager about the ratings you’ve given yourself. This negotiation can be high stakes if the results also determine your salary.

Instead of the process above, I’ve long thought that in a perfect world, feedback would be continuous. Then the performance reviews, if they had to happen, would be more of a formality, codifying what is already known. No energy-draining difficult conversations and no surprises!

In most places I’ve worked, this would amount to a very idealistic world view. And it’s a view I’m prepared to adjust on my reading of recent research into performance reviews.

[Tweet “The performance review is not dead, it’s evolving. That’s something we can all celebrate!”]

What you could miss if you drop performance reviews

There are several risks an organisation takes if management decides to drop performance ratings or reviews. Most of them relate to removing the mandated conversation that has to happen between a manager and his staff. By cutting back on the performance reviews, you could miss out due to:

• Lost opportunity for discussions beyond day-to-day task management and reporting
• Less engagement with employees as managers retreat to doing what’s essential for their immediate KPIs
• Lower productivity from high performing employees because they aren’t getting positive feedback on their performance

How do you get the best of both worlds?

More than most, I understand the desire to ditch the traditional performance review. That could work as long as other processes are in place to avoid the risks listed above. In my experience, the organisations who have successfully done so are rare – and well-resourced. My hybrid solution would combine the following with a scaled-back performance review process.

• Creating opportunities (and motivation) for regular feedback for all team members
• Asking the right questions, focussed on what is important to both greater employee engagement and delivery of the strategic plan
• Consistent, regular and effective feedback (in both directions)

Implementing these changes will be easier with the right tools. We recommend using 15Five to create opportunities, asking the right questions and being consistent.

Get your free trial of 15Five now to see how it can change your approach to performance reviews.

What do you think?

Please share your view below. Have you tried new approaches already? What has worked for you?

Are you ready to try something new but don’t know where to start? We’d love to help you sort it out if you get in touch!

Postscript:

Following the publication of this post, the Australian Financial Review published a related article the next day about GE replacing performance reviews with regular check-ins. If you’re exploring doing the same, here’s the first step in your research.