Employees despise them, and increasingly more and more managers of companies of all sizes are agreeing – the loathed annual performance review has had its day (see https://www.tamu.edu/faculty/payne/PA/Scullen%20et%20al.%202000.pdf), delivers unreliable results that don’t give any sort of clear picture and overall creates way too much trouble.
It’s certainly true that a crucial element of the management process is actually managing the people who work for you, and that devising ways to get the most out of them will undeniably lead to increased productivity and therefore higher revenues and profits. It’s for these solid reasons that the annual performance review has traditionally been used by companies attempting to extract relevant information on all aspects of a worker, from their behaviour and attitude to how well they cooperate with colleagues and how they do their job.
But company owners and management executives are starting to realise, in increasing numbers, that the methodology of conducting such intrusive probes into employees just doesn’t work. It’s seen as a burden that focuses more on the process itself than the people under scrutiny, staff are highly suspicious – and extremely wary – of it and as it’s historically driven, in this faced-paced modern business world, it’s largely perceived as being entirely out of date.
Major companies, from GE (see www.qz.com/428813/ge-performance-review-strategy-shift) to Accenture (www.smh.com.au/business/workplace-relations/goodbye-rankings-accenture-gives-annual-performance-reviews-the-flick-20150721-gihn7y.html) and many more, each with many hundreds of thousands of employees around the world, are ditching annual performance reviews and instead utilising a system that is proving to be far more accurate, fairer and much kinder all round. This new process is ‘continuous feedback’, the concept of constantly appraising a worker instead of a sudden interrogation at just one point in the year.
In fact, new research by PwC, the global professional services firm headquartered in London, shows that as many as two-thirds of big companies are changing the way they evaluate their employees’ performance, and that 5% of them are thinking about getting rid of performance reviews and their associated ratings.
“The research shows that the growing frustration from employees and managers with the year-end performance process is leading many organisations to focus on creating a continuous feedback culture to take the emphasis off the year-end appraisal,” PwC said in a note accompanying its research results. (More here: http://pwc.blogs.com/press_room/2015/07/more-companies-planning-to-ditch-end-of-annual-performance-reviews-and-ratings-but-will-employees-be.html.)
Employees are one of a company’s main assets, helping to propel a firm ever forward. Rather than thinking they have to be subjected to a major examination each and every year, as companies everywhere are now discovering, monitoring their progress and performance right around the year is a far more rewarding prospect, for the company and their employees.