Is There Any Value Left In Annual Performance Reviews?

Progressive companies can and do make a difference when it comes to performance reviews – an example being W.L. Gore. This company does not have an HR function; instead, each business leader performs that role. All members of a team review each team member which determines training, recognition, promotion, pay etc. Turnover is about 1% and when people do leave they leave because they are not cutting it; not because of a skewed or subjective performance review.

At its most basic, a performance review involves an employee sitting down with their manager to discuss their individual performance. The review supposedly offers an opportunity for both the employer and employee to raise any issues, to offer feedback, and to discuss support for future employee development.

Annual performance reviews have been a quintessential part of employee management strategies for many years now. However, the effectiveness of such reviews has been brought into question in recent years, with many employers agreeing that they hold no real value for them or their employees.

Writing and delivering annual performance reviews is a challenging and lengthy process. The aim is to provide employees with insight into how they can grow and improve in their roles, but often the reviews fail to achieve that. Like presentations they are thought through well or rehearsed. Equally how well have managers/leaders been trained in managing performance reviews effectively.

What’s clear is that employees do not benefit by being reviewed in a single snapshot of time. Managing an individual should be seen as a continuing process and not an occasional one. And, if this is the case, surely employees would better benefit from receiving continuous, constructive feedback from their employers. Enter stage left, coaching.

Instead of waiting for an annual meeting to discuss performance, employee feedback should be delivered in a timely manner so those employees can respond immediately to the feedback and resolve any issues at an opportune moment. And it is not only ‘Millennials’ who want this. By waiting for an annual review, important issues may be forgotten or left out, meaning they are left unresolved. Heaven help us if the annual review is also linked to a salary review.

Workforces are becoming increasingly diverse; the business landscape is constantly evolving and companies have to adapt more quickly than ever before. It is this type of working environment which demands more frequent and insightful feedback, as only then will employees be able to perform to the best of their abilities.