What the Experts REALLY Think About Performance Management

By Michael Heller

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Performance reviews have been a long-time subject of debate. With the implementation of new HR technologies like automated microfeedback, people are starting to question whether regular performance reviews are useful at all. Shockingly, only 8% of companies believe their performance review process is highly effective—so why waste the time? We asked three performance review pros what their thoughts on the annual review were. Should they stay, or should they go?


Frequent Feedback Is On The Rise

“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.” – Pierre Nanterme, Accenture CEO

So the annual review is on its way out, and no wonder, when 45% of HR leaders don’t think annual reviews are an accurate appraisal of employee’s work. So exit annual performance reviews and enter microfeedback! New automated systems make tracking employee progress a breeze, and have the ability to go out to employees once a month, bi-weekly or even once a week. Take a cue from companies like Deloitte and GE, who are doing once-a-month one-on-ones to keep up with their employees.


If Everyone Hates It, Throw It Out

“Performance management as practiced by most organizations has become a rule-based, bureaucratic process, existing as an end in itself rather than actually shaping performance. Employees hate it. Managers hate it. Even HR departments hate it.” – Laszlo Bock, Former SVP of People Operations, Google

If nobody likes it, it’s not going to be good for the business, that’s the bottom line. Even helpful, constructive feedback is going to lose its value when it’s wrapped up in time-wasting rules and regulations. Unsurprisingly, considering how much everyone hates them, 30% of performance reviews end up actually decreasing employee performance. Too many unhelpful annual reviews and employee engagement is bound to take a hit as well. Switch to frequent feedback to ensure you aren’t part of the 79% of companies that have significant retention and engagement problems.

How you, too, can create ongoing performance management for your employees:


Make Way For Millennials

“The world isn’t really on an annual cycle any more for anything…It’s the way millennials are used to working and getting feedback, which is more frequent, faster, mobile-enabled, so there were multiple drivers that said it’s time to make this big change.” –Susan Peters, Senior Vice President, Human Resources, at GE

Studies show that 68% of corporate recruiters say that it is difficult for their organizations to manage millennials. However, it’s projected that 75% of the workforce will be millennials by 2030, so it’s time to get used to their work style. Annual reviews aren’t going to cut it for this generation. They’re looking for coaching and support, not just a once-a-year check-in. Companies looking to be on the front lines of innovation should think seriously about changing up their annual reviews to something a little more compatible.

Performance reviews aren’t going away, and they’re not going to anytime soon, but they are changing. Annual performance reviews take too much time, have too many rules, and are wildly unproductive—even counterproductive at times. Instead, frequent feedback and microfeedback are on the rise. You’ll be shocked at how much engagement, happiness and productivity rates skyrocket: 69% of employees say they would work harder if they felt their efforts were better recognized.


Bio: Michael Heller

Michael Heller has 20+ years of experience in strategic human resourcestalent management and technology consulting. As an HR executive at Washington Consulting, Digital Management and Deltek, Michael led teams to develop innovative human capital management programs and initiatives. Previously, Michael held a variety of positions at American Management Systems and Booz Allen Hamilton where he executed on talent acquisition, total rewards, performance management, strategic HR partnership and philanthropy strategies.

Michael serves the community as a board member of Teardrops to Rainbows, an organization dedicated to supporting families of children with cancer. Michael has a Masters degree in Human Resources from Georgetown University and earned his Bachelor’s degree in Economics from the University of Connecticut. Michael resides in Gaithersburg, Maryland with his wife and daughter and enjoys cooking and college basketball.

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