The Traditional Annual Review Is Done Wrong

Keep the performance review employee focused and goal oriented

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If you were asked what Adobe, Microsoft, and Gap have in common, you might answer that they make great use of technology. While this is true, in this instance, their commonality is in a particular opinion of an HR rite of passage that managers love to hate: the traditional annual employee reviews.

In fact, the three companies think so little of the practice that they’ve dumped it altogether. They’re not alone. According to analysis from the Institute of Corporate Productivity, nearly 10 percent of the largest companies in the United States have said au revoir to the annual review.

They have put in its place varying methods of recognizing employee contributions that better match their cultures. Many of them have adopted a program that requires a self-evaluation by the employee. At one company, they’ve taken that thought to what some may call its logical extreme and called the employee evaluation program by the title, "You In Review."

"You In Review" is a performance assessment that requires employees (and their supervisors) to take the lead and grade themselves. It’s not a 360-degree feedback survey at all. Rather the process calls on the employee, not their peers, to look in the rearview mirror and identify their successes, their defeats, and their areas for improvement.

Rules Governing Sharing the Employee's Findings

They then have to present their findings to their senior leader. But, there are some rules. The presentations can’t be a simple conversation. This is a business after all and the HR staff members require that the presentation is documented for the employee file. Nor can the employee make the presentation a lengthy email or White Paper.

In fact, they are allowed to put only 50 percent of the presentation in writing. There is also a time limit. Employees’ presentations can’t take less than 5 minutes and can’t take more than 15 minutes. Though these limitations are few, they do require the employee to tap into their creativity. The company has had slide decks, videos, a poster board, and even a puppet show with visual aids.

Senior Staff Creative Response to the Employee Presentation

But the review doesn’t stop there. While managers put the onus on employees to tell them about their year in review, the company requires the senior staff to respond in a way that’s equally as creative. The response needs to include genuine and authentic feedback and highlight the employee’s successes as well as explain their areas for improvement.

Some of the employees have received home-made pop-up books, videos, and even a puppet show sequel. Why do all of this? According to CEB (formerly known as Corporate Executive Board), 9 out of 10 HR leaders say that the traditional annual review process does not yield accurate information.

That number would seem to bolster a GuideSpark survey of 325 full-time employees which revealed that employee performance reviews are not as constructive as once thought. The survey results shed light on workers’ attitudes toward their organizations’ employee review processes. Big surprise, 75 percent said that employee performance reviews don’t always lead to better performance.

The consulting firm, Accenture, joined the movement against traditional employee reviews. They said that they were too costly and don’t achieve the goal of improving performance. So, there is a consensus across a wide array of industries that traditional annual employee reviews don’t yield accurate information, don’t improve performance, and cost too much.

Employee Review Processes Recommendations

Here are thoughts to keep in mind as you re-evaluate your own processes for employee evaluation.

  • Make the employee review experience engaging. Employee performance reviews should re-engage and re-direct towards greater success for the upcoming year and not just be a box-ticking exercise. The end result should not only increase engagement between managers and their employees but also demand creativity and innovation.
  • Put the performance in employee performance reviews. Whatever process you settle on make sure it focusses less on the negative and more on the positive. Highlight the positive performance the employee has demonstrated over the year and have fun with it. Facilitate reflection and introspection.
  • Allow your employees to examine their year and showcase what it took to deliver their results. It will help refresh your leadership’s memory and fill in the blanks of what was actually accomplished. This will leave your employees feeling proud and ready to accomplish new goals.

You have to go all-in on re-tooling the evaluation procedure. Presenting what is essentially a re-packaged version of a failed system is still a failed system and is likely as not to wind up leading to even worse results.

Furthermore, you need to fully embrace your new system. Whether "You in Review" or another employee review direction is selected, don't fool your employees and lose your credibility by not adopting the new employee reviews approach systemically and completely.