If you’re a manager or business owner and you’re still having an annual performance review with your team members, please do yourself a favor and STOP.
The Annual Performance Review Does Not Work
The reality is that an annual performance review no longer works in today’s environment and it doesn’t serve managers and employees the way it may have in the past. Events transpired at a different pace then, but the reality is that I wasn’t too big of a fan of annual performance reviews even at their height. There were too many holes to waiting a whole year.
The work environment of today is fast. It’s disruptive and innovative. There is a myriad of decisions that are made by employees and managers alike on any given day and to wait a whole year to provide feedback is counter-productive.
We live in a world of instant gratification. We expect it from everything, from the red alerts in our social media apps, to the on-demand nature of, well everything, to team-member performance feedback.
According to this article in Harvard Business Review, the top global companies are dispensing with annual performance reviews because they no longer fulfill the demands of today’s business environment. These corporations include Adobe, Dell, Microsoft, Deloitte, Accenture, PwC, Gap, and even the grand-daddy of process, General Electric.
With their heavy emphasis on financial rewards and punishments and their end-of-year structure, they hold people accountable for past behavior at the expense of improving current performance and grooming talent for the future, both of which are critical for organizations’ long-term survival. In contrast, regular conversations about performance and development change the focus to building the workforce your organization needs to be competitive both today and years from now. Business researcher Josh Bersin estimates that about 70% of multinational companies are moving toward this model, even if they haven’t arrived quite yet.
Millennials who are now the vast number of employees in the workforce surpassing Generation X want feedback about their performance in real-time and as it happens. They want to know as events transpire how they’re doing, which candidly, makes sense.
Job functions or roles can change on a dime and teams are expected to come together for projects quickly, disassemble and then come together again when the next project moves to the top of the priority list. The nature of work itself is much more fluid than it was in the past. It doesn’t make too much sense not to provide feedback for performance on an ongoing and continuous basis.
Adobe Check-In Performance Feedback
Adobe sets annual expectations and goals for their employees, but they have also instituted a plan to provide their team members ongoing feedback on their performance through their Check-In program.
The Check-in initiative has helped them lower their attrition rate. What’s more interesting is that they’ve found, “Managers are now having on-going, genuine conversations with their team members; employees are engaged in feedback; we are saving approximately 80,000 hours of our manager’s time in the annual review process; and our voluntary attrition continues to trend downward.”
Large companies have been moving for more than a decade toward regular performance feedback, but you don’t have to be one of the global giants to implement this in your company. A simple search will provide you with many options to automate your performance management and review process and create a much better performance environment for the digital age.