Organisations can expect continuous feedback to become the new performance management standard, however, HR needs to take a number of steps to make this a practical reality, writes Tym Lawrence
As HR professionals, you’re likely familiar with the general feeling in the office when the time for the annual performance reviews rolls around. Your staff, managers, executives and even the HR team are probably thinking “not again” and “this is a huge waste of time.”
There’s a reason annual performance reviews are widely loathed. Put simply, current approaches are time-consuming but don’t produce the desired outcomes.
According to research conducted by CEB, 90 percent of managers are displeased with how annual reviews are conducted. Another 90 percent of HR leaders believe the process does not yield accurate information. Worse, annual reviews are incredibly time-consuming, with managers spending an average of 210 hours a year and employees each taking 40 hours a year on these activities.
What’s more, results obtained from annual reviews are often biased and don’t accurately reflect employee contributions. CEB’s research shows that “individual performance ratings have absolutely zero correlation with actual business results”.
Thankfully, things are starting to change, partially due to generational change from Millennials, who will represent 20 percent of the workforce by 2020.
Alongside remuneration benefits and flexible workplace practices, employees today – particularly Millennials – want to see their employer ‘investing’ in their professional development. In a recent TriNet survey, 85 per cent of employees said they’d feel more confident if they could have more frequent conversations with their managers. Another study from Robert Half, showed 82 per cent of employees would like to discuss their career path one to four times a year.
“Put simply, current approaches are time-consuming but don’t produce the desired outcomes”
Perhaps it’s time businesses put the annual performance review to bed and replaced it with something more timely and effective.
The continuous feedback alternative
Companies like Accenture, Adobe, Deloitte, GE, Netflix and Gap are taking a fresh approach to the performance process, harnessing technology to provide more regular evaluations.
This approach works. As Accenture chief executive Pierre Nanterme said: “People want to know on an ongoing basis, am I doing right? Am I moving in the right direction? Do you think I’m progressing? Nobody’s going to wait for an annual cycle to get that feedback.”
For employees, feedback is more impactful when it is given immediately. It enables more timely behaviour change and keeps employees focused on the most important goals. Furthermore, because you can obtain feedback from anyone, outcomes are more fair and unbiased.
For managers, regular check-ins helps encourage mentoring and coaching, cut down on end of year paperwork and ensure that annual conversations (if you still have them) have fewer surprises.
“For employees, feedback is more impactful when it is given immediately”
For HR teams and executives, having more accurate and timely data means you can better find and develop your high performing talent, as well as manage underperformers more effectively. Other benefits can include:
- Improved collaboration and timely decision making: continuous feedback creates open communication and ensures problems are addressed quickly;
- Ability to plug skills gaps more effectively: with skill shortages on the rise, continuous feedback technology can allow organisations to be more agile and adaptable;
- Higher employee engagement and retention: employees will have greater incentive to remain productive and engaged when their performance is an ongoing conversation
Futureproofing with HR technology
Moving forward, we can expect continuous feedback to become the new performance management standard. For this to happen, you will have to invest in modern HR technology, as large amounts of feedback can’t be managed on paper or through email. When investing, look for technology which can:
- Deliver a single dashboard to easily review, search and filter all feedback you’ve been given, provided or requested
- Allow anyone to provide or request feedback for themselves or someone in their team – with notifications and reminders for people
- Categorise the feedback – e.g. giving recognition versus coaching and mentoring
- Link feedback to competencies and goals in an integrated talent system, so you can offer this feedback through structured monthly or quarterly check-ins
Ultimately, this technology will allow your staff to easily request and provide feedback, which can then be made available when conducting an annual performance review, if you still choose to.
Or maybe this will signal the death of the annual review for your organisation – which might not be a bad thing.
Image source: iStock