I've brought you all together today to pay our respects to our long-time friend and colleague, the annual performance review.
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Some of you may not even remember that prior to the annual review's arrival on the scene, employees had no chance to give feedback, and the concept of engaging employees hadn't even been invented yet. The annual performance review changed all that, and we shall ever be grateful.
However, times change, and we must change with them. Rather than mourn the slow, painful death of the annual review, let's just remember it fondly and move forward from here, shall we?
Okay, It's Not Really Dead
You got me. Maybe giant enterprises like Netflix, Adobe, and General Electric have axed the annual performance review, but it isn't dead and gone entirely. However, those who wish to keep performance reviews need to stop using them as yearly excuses to talk to employees uncomfortably about their performance concerns.
"While we are not necessarily saying that an end-of-year discussion is a bad thing, the emphasis should be on daily, weekly, and monthly touch points throughout the year," says Rishav Gupta, CEO of performance management platform iCoachFirst. "This way, employees are clear on where they stand at all times, which allows them to stay the course or course-correct as needed."
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To better facilitate feedback, organizations should adopt the performance management platforms that are best tailored to their environments, Gupta says. This may include platforms that allow for informal feedback between anyone in the organization, coaching conversation templates, and social channels of communication for teams to engage as collectives.
Why You Shouldn't Mourn the Formal Review
Gupta lays out the following three reasons why the annual performance review should be left to fade into obscurity:
1. The performance review is a post-mortem, not a living, actionable process. The focus needs to be on the things that really matter, [which is] everything that happens before the review: ongoing coaching, feedback, development, engagement, etc.
2. The way we work is changing. Things happen fast, and so must talent management processes. Goals need to be short-term and evolve with the business. Static 12-month goals are a thing of the past that don't serve the business well. Performance and development should be talked about continuously throughout the year as things actually occur.
3. The largest segment of the workforce, the millennials, won't stand for it. They demand to be developed and developed continually. They have grown up in a social, mobile world, and they want ongoing feedback from multiple sources, including managers and peers.
Companies that fail to adapt to modern workforce trends by engaging and guiding employees on a more frequent basis will suffer in terms of talent.
"One of the biggest risks is alienating the largest segment of the workforce, millennials," Gupta says. "Millennials expect more feedback more often. If they don't get it, they either disengage or leave."
Let's say you've decided to leave the traditional review model behind and update your practices. Where do you start?
"Don't do it all in one jump," says Gupta. "Start with the basics."
For many organizations, "the basics" includes adopting the right technology to facilitate regular feedback, as well as training managers to constructively coach direct reports. If an employer is eyeing a peer-to-peer feedback initiative, employees will also need training on best practices.
"Once a solid foundation of coaching and peer feedback are established, companies can then advance to implementing other important aspects like agile goal-setting," Gupta says. "The important thing is to go at the pace that the organization can sustain and to manage change proactively."