The holidays have come to an end and companies are ramping up for the new year. While executives are getting ready to roll out new operational plans, strategies and budgets, many employees are preparing for their annual performance review. Although the review process is a necessary part of business, it can be a time-consuming and tedious exercise for both managers and their direct reports. Workers can also feel they are in the hot seat with regard to their performance from the previous year. Most importantly, it can delay feedback and two-way conversations that would have been more beneficial at an earlier time. This postponed interaction is causing some employers to look at alternatives to the annual review to build a stronger, more cohesive company culture.
Accenture is a company that recently decided to eliminate annual reviews. With a workforce where 70 percent of employees are Millennials, the organization realized that traditional evaluations were not effective for engaging and motivating this generational group which values frequent, real-time feedback. As a result, Accenture developed a digital approach that encourages managers to “coach in the moment” from any device, instead of “after the moment”. Their goal was to create a culture that promotes continual growth and learning for all employees.
“It is not surprising that workforce expectations are changing and are being influenced by the social, mobile world in which we live,” says Nancy Halverson, vice president of global operations for MRINetwork. “Companies that understand the implications of this, and are nimble enough to adopt new technologies and different approaches to work, will be most successful with attracting and retaining top performers that will become the future leaders of tomorrow. Analyzing the effectiveness of the review process and what it says about the organization’s culture can be a great place to start.”
Halverson suggests companies that are looking to re-evaluate their performance review process ask the following questions:
Is the annual review the main time that feedback is provided on performance? Look for opportunities on a regular basis to set priorities, discuss work outcomes and coach team members. Whether it is weekly status meetings, daily advice or a combination of the two, employees are frequently more engaged when they feel their managers are committed to helping them become more successful workers.
Does the company provide mentoring opportunities beyond the insight provided by supervisors? Employee groups that facilitate peer-to-peer mentoring, internal networking and presentations from leadership on career ascension can help organizations develop a culture of growth and development.
What technologies or new approaches can be leveraged to expedite feedback? Not every company will find it necessary to implement a digital process like Accenture, but business leaders should continually consider whether they are communicating with their direct reports in a meaningful and timely manner.
Eliminating the annual review is not necessarily the answer, as many companies find the procedure effective in evaluating employees and holding them accountable. “The key is to find ways to augment the process by creating opportunities to promote dialogue that will improve work flow, productivity and career advancement,” adds Halverson. “Ultimately, that is the type of environment that top performers seek.”