The demise of the annual performance review

Over the past few years there has been a growing trend away from annual performance reviews. As a result many organisations including Deloitte, Adobe and Accenture are now reporting improved employee morale, productivity and innovation.

With the changing nature of business and employee expectations, organisations need to adapt quickly to ensure business continuity. An annual process of management, monitoring, evaluation and realignment no longer provides this.

By its nature, an annual performance review consolidates a year’s worth of feedback into one meeting with recent events understandably at the fore. This means managers feel they don’t have to provide in-the-moment or regular feedback and employees hold back their thoughts about their role, the organisation and their ideas for potential changes or improvements. Often there is no organisation-wide standard so reviews can be seen as unfair when promotions and salary increases are included as part of the process. 

Many employees want more feedback so the focus should perhaps change to continuous performance management. This would allow a more informal, agile and less stressful process with the organisation able to dynamically set goals, get feedback and improve productivity along with better collaboration, greater alignment and more collective responsibility. Employees would benefit from increased recognition and work evaluation, more performance feedback and empowerment and the alignment of their personal goals with organisational ones

There is a clear correlation between higher level of motivation and timely, accurate feedback so maybe its time for managers to look for ways to give effective continuous feedback.?