For anyone who has worked in a corporate setting, you must have been on the receiving end of the much dreaded “performance reviews”. We have all been through this or have had to facilitate these meetings.
But the question of the hour is – are these reviews effective after all?
According to some recent studies conducted in this area:
– 45% of HR leaders do not think annual performance reviews are an accurate analysis of employees’ work.
– One in five employees doubt that their manager will provide regular, constructive feedback.
– 80% of Gen Y said they prefer continual feedback over formal reviews.
Don’t get me wrong – constructive feedback certainly is valuable and we need it. Just like getting gold stars back when we were in school worked and was a positive and constructive feedback mechanism.
Reasons why your company should not bother with performance reviews
The first traces of performance reviews were in the 1950s, created to evaluate work in the industrial businesses at the time. What needs to change are the hundreds of companies that continue to operate with this outdated and irrelevant system.
– A one-way lecture: With some managers who do not communicate in the right manner, more often than not, performance reviews end up being lectures. Everything hinges on that one meeting. Do you want to give your employees a heart attack? When managers are the ones who do all the talking, there is little scope for an engaging, two-way discussion. Have you ever experienced this classic, “top-down” approach?
– Says little about the employees’ development: While these review meetings always motivate the employees to keep learning and do better, they rarely focus on how best they can accomplish this ambiguous goal. Sometimes it is vague and confusing and other times there is no mention of how the organisations can help the employees’ growth. What makes your company stand out on this front? How do you contribute to your employee’s growth as they contribute to your business?
– Rigid systems: Some companies have set up strict and rigid systems like a five-point scale or grade system, that do not really reflect the entire reality. While these standardised methods make it easier on big businesses with thousands of employees, this approach can cause unhealthy competition, animosity among the team members, demoralise employees, create a lot of pressure, and make them anxious.
DID YOU KNOW: Google resorted to “goal-setting” instead of formal rankings and Cargill, a food producer and distributor business set the trend in 2012 for “Everyday Performance Management” systems – when are you going to update your company’s ways to suit the current trends?
– Annual meetings are not the way to progress: Your employees and business are both ever-changing and constantly evolving. Why wait an entire year to dish it out? If you’ve got something to say, now is the time. Help your employees plan their goals and offer feedback to them every step of the way!
– These meetings can often go astray when performance is linked to pay raise: Compensations end up over shadowing the significance of these reviews. Do you think it will be easy for the employees to focus on the feedback when they are worried about their pay raise and job security? Both pay raises linked to good performance and feedback, are important discussions to have but can also be done in different points of time which will ensure that the employees are not under so much pressure.
Bid adieu to the age-old performance review systems and modernise in 2020!
Given that performance reviews are a product of the Industrial Revolution, where it was easy and necessary to evaluate the work done (or not) by employees stationed in front of conveyor belts, it helped shape things up in the businesses without a doubt.
Knowledge workers, on the other hand, are more complex and play a bigger role in the innovation and sustenance of organisations across the globe. In today’s time, we value creativity, million dollar ideas and novel ways of achieving goals that employees bring with them.
Isn’t this the kind of energy and enthusiasm that companies hope to nurture? While you certainly are doing everything in your power to support, encourage and inspire your employees, I urge you to take a step back and reevaluate how truly effective your performance review systems are if you have not modernised yet.
Here’s what you can do:
1. Stop leaning on “annual assessments” and adopt real-time feedback:
Continuous and frequent feedback collection is a more relevant way to go. According to a study, 68% of employees who receive accurate and consistent feedback feel fulfilled in their jobs. Startups and small businesses with small teams are quite the trendsetters for “daily check-ins”, sometimes both at the start and end of a work day.
Maybe you can start with how you are feeling, what your day will look like, share your challenges and problems and how your team can help you achieve your tasks, and so on. Modern performance reviews are a perfect combination of talent management strategy and the right technology to support it.
2. Facilitate an open, two-way dialogue about expectations and performance with technology:
Asking your employees to speak first does wonders as well. Ask them about what they like or hate about the job, a glimpse of their journey, where they think they have failed or succeeded and most importantly, what challenges they encountered along the way and how you can help. Then, add to this self-assessment.
In 2016, General Electric, an MNC with over 300,000 employees, revamped its traditional, yet legendary Employee Management System that was set up in 1976.
They switched from annual reviews to an innovative new method of FastWorks, where they designed an app to facilitate healthy and meaningful conversations and feedback sharing between team members – all year long. Allow technology to work its magic!
Are you reluctant to let go of the systems and processes that you are used to following for all these years? Fair enough.
But I would like to remind you how essential it is for you to modernise, stay updated and one step ahead of all the wonderful changes we are undergoing in the professional world – or be left behind.
If employee experience is not at the core of your business, you will not have a pillar to lean on. In these trying times, as you and your employees work from home, I encourage you to schedule a virtual meeting to find out what your team has to say about this.
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