There was a time when it would be considered a clear mark of a rubbish employer if there wasn’t a structured yearly appraisal in place. But the modern workplace recognises that a date in the diary once a year, coupled with a fat form to fill in, is nowhere near as effective as regular informal feedback.
Too many businesses conduct annual reviews in a way that is overly formal, creating unnecessary paperwork and ticking a box, without really getting to the heart of the employee’s performance.
Lots of big companies, such as Adobe, have scrapped the yearly appraisal after realising the huge investment in the process often fails to hit the mark.
At Adobe, after a staff consultation, the old performance management system was replaced with check-in discussions at least once a quarter with less paperwork and proper space to review contributions, reward achievements and gather feedback.
It’s a great example, and is starting to be adopted by many forward-thinking companies.
Formal box-ticking appraisals are a barrier to good performance and development
How often should performance be reviewed?
There is no magic formula, but regular and meaningful is a good rule of thumb.
- Don’t save things up for a yearly formal review
- Involve employees in decisions to reprioritise workloads in real time, and explain why it’s necessary.
- Meet monthly for a structured review and if that’s not possible, no less than every six months.
Daily feedback is 6x more likely to be meaningful than annual feedback
How should I be managing and developing performance in my organisation?
- The key to managing performance is open and transparent conversations, where the employee feels in control of their own destiny.
- Both employer and employee know what’s expected of them, what they’re great at, and where they need support. It’s not rocket science, this approach builds engagement, which is better for business.
- Research shows engaged employees generate 43% more revenue than disengaged counterparts. High engagement can also lead to a tripling in profit growth, an 87% reduction in staff turnover and a 20% improvement in performance.
It's not rocket science: higher engagement = improved productivity and performance
What’s the starting point for a new system?
Make sure both the employee and manager are clear about what their performance is being measured against.
You will need:
- A job description that’s real, not aspirational! It should outline responsibilities, and accurately reflect the job that’s being done.
- A clear understanding of what’s expected at work.
- A rock-solid connection between individual goals and the goals of the business.
- With these basics in hand, managers can agree clear objectives and work out with employees how to regularly measure performance.
Have regular conversations to create a high performance culture
What does a good performance review system look like?
A system that’s working well will increase staff moral, engagement and productivity. It will nip problems in the bud by dealing with anything that comes up quickly, and will prevent the company from spending huge chunks of time on the paperwork that traditional annual appraisals generate.
Top tip: use a blend of formal reviews and informal development conversations
How can I design the right approach for me?
- What works for you will depend on your business, there is no one-size fits all, although as a general guide everyone could benefit from creating a process that:
- Reviews energy, engagement, wellbeing, resilience, skills, personal development and priorities.
- Creates a balanced scorecard which measures WHAT’s been achieved and progress made.
- Gathers feedback from colleagues, customers and managers on HOW the employees’ approach their work.
- Outlines goals and commitments …what’s happening next and how will the business support this.
- Moving from a yearly appraisal system to more regular check-ins may be a huge change for your organisation and managers may need lots of additional training and support.
- Managers may need training and support to give regular and meaningful feedback
Organisational wide forms, systems, templates and guidance are a good idea, including making best use of HR self-service and HR systems. Above all, managers need to be self-aware and understand how to tailor their approach to the needs and wants of each team member.
Managers may need training and support to give regular and meaningful feedback
Organisational wide forms, systems, templates and guidance are a good idea, including making best use of HR self-service and HR systems. Above all, managers need to be self-aware and understand how to tailor their approach to the needs and wants of each team member.
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Some of what we’ve outlined here is simple, but implementing activity that’s targeted to help those that need it most often gets businesses in a pickle. Primarily because they get bogged down about treating all employees the same.
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