Annual Performance Reviews Are Dead... Now What?
Many companies are killing the traditional performance review and for good reason. Annual reviews are stressful, time-consuming and anxiety-filled experiences providing little or no value to the employee or company. In most annual reviews, you're looking back, instead of forward, and not providing feedback right when it's most valuable. Okay, we get it! Annual reviews are gone. But, now what do we do? Many HR professionals are struggling with this dilemma: How do we drive performance, development and engagement in a world without annual reviews?
The answer lies in the following three critical components:
- Alignment – Employees and managers first must be on the same page with respect to performance level, development plans and individual motivators. You can’t plan for the future until both parties agree on these factors.
- SMART Goals – Out are the annual 1-5 ratings of the past and in are SMART goals and metrics to measure performance and development. These measures provide transparency so everyone knows how they’re doing at any point throughout the year.
- Feedback – Implementing various channels for feedback is the most critical component in driving performance. Here are three different ways to build a culture of feedback:
- Structured – Providing employees one-on-one touch points with managers and/or leadership at least once a month. Ensure you’re still aligned and check-up on performance or development goals.
- In the moment – This type of feedback takes place at the time when it’s most effective and the employee can learn best – after a meeting or an activity.
- Multi-directional – Here you're opening the outlet for other employees, clients and peers to provide feedback. Colleagues who don’t oversee the employee can still provide relevant and constructive feedback. This requires training and encouragement; you have to create an environment where this is expected and appreciated.
It’s okay to kill annual reviews. But if you do, be sure to have a solid plan for driving performance, development and engagement. Implementing a strategy focused on alignment, SMART goals and feedback is a great place to start.
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