It’s around this time of year that many have annual performance reviews on the mind – a process almost universally dreaded by employees and managers alike. Not only does it generally involve time-consuming paperwork, but also often frustration and anxiety among staff. It’s a good time to ask yourself, is a review accomplishing what it should?
Companies are finding that that the energy, time and money spent on performance reviews often don’t accomplish their actual aim – to improve employee performance. In a Deloitte survey, more than half of their own executives didn’t believe their employee review systems drove performance or engagement. This led to the firm disbanding ranking systems.
Microsoft, Adobe and Accenture are among those who are in the process of, of have already, transformed their annual performance review process because they believe the traditional way is both flawed and ineffectual. Recently the Washington Post, citing a study by management research firm CEB, reported that 6% of Fortune 500 companies have got rid of rankings.
You may be wondering, what do these companies use instead? Their new systems generally:
- Provide more regular feedback that emphasise future, and not past, performance: Feedback on roles happens more often, at the end of each big project or quarter. Rather than reviewing a full year’s performance in one shot, quicker, more frequent reviews help employees move forward rather than on past achievements or failures.
- Are less subjective and focus more on the employee in their own role: Reviews no longer pit employees against each other through ranking mechanisms. Managers are asked what they would do with specific employees (train them more, promote or incentivise them) instead of how they personally feel about an individual or even how well they perform in comparison to others.
It’s important to keep sight of the reason behind a performance review – it’s not just another administrative task that comes with the job – it’s an opportunity to understand our employees better and to help bring out the best in them in every way.
Author: Brett Tromp CA(SA) is CFO of Discovery Health
