As we are heading to the ‘traditional’ performance review period – how will your organisation handle them this year? Will you still have them, cancel them or postpone them?
Is there still a place in today’s ever-connected world for the annual performance review?
Many high profile companies — like Adobe, GE, Accenture, Deloitte, IBM and Netflix — are saying no.
Pointing to annual reviews as time-consuming and resource-sucking, they’re shifting to a more agile approach.
And in some cases, they’ve dumped the scaled rating system all together (you know, an annual rating from 1-5 for each KPI).
In a Harvard Business Review article, Netflix’s Patty McCord stated: “If you talk simply and honestly about performance on a regular basis, you can get good results — probably better ones than a company that grades everyone on a five-point scale.”
In the case of Deloitte, they found that creating an annual rating of 65,000 employees took close to 2 million hours!
They also criticised yearly goal setting, arguing that goals need to be set and adjusted much more frequently:
“Our design calls for every team leader to check-in with each team member once a week…These brief conversations allow leaders to set expectations for the upcoming week, review priorities, comment on recent work, and provide course correction, coaching, or important new information.”
So what am I saying here? Is the annual review a redundant process from a by-gone era, ready to be written off and forgotten, just like the fax machine?
Not exactly. You need to adopt what works for your business.
As a company, you need to define and clearly communicate to your team how you want to handle:-
As for Performance Management – this should definitely be dealt with as and when required (as opposed to using the annual performance review to initiate this discussion).
With our clients we have a whole range of variances subject to their objectives and resources however generally our recommendation is a mixture:-
Need help with any of the above. Don’t hesitate to reach out to our BespokeHR team to help.