Rethinking Performance Management

John Krautzel
Posted by in Career Advice

Not surprisingly, performance reviews and evaluations are some of the least favorite activities among employers. Managers and subordinates both do not enjoy these tasks because it causes conflict and strife among team members. When one person earns a promotion over another at the end of the year, that can cause even more resentment among staff. Instead of tweaking a company's annual performance reviews to prevent upset, perhaps it's time to move to a completely new model for performance management.

Old-Style Performance Reviews

Traditionally, an annual performance review may be the only time an employee receives an honest evaluation of his performance. Some employers utilize a 90-day probationary periods, but then it takes another nine months for the annual performance review to come around. At which time, the employee may receive a letter outlining what he accomplished over the past year, and what he must improve upon. The review probably also contains a checklist with ratings between one and five.

The employee signs the document, and then it goes into a permanent file. That file then stays closed for another year. This old methodology should probably cease now the digital age of cloud computing is here.

Constant Feedback Models

One way to bring performance management into the 21st century is through constant feedback given to employees. Instead of an annual review, people can input feedback into a computer program all year long. Waiting one year for someone to improve could cost a business valuable revenue, sales and profits. A year-round performance-management model aligns a workforce more readily, so it meets goals faster.

Computer software makes constant feedback a reality. Software can help managers record feedback in dedicated files. An employee's log can show precisely when he received feedback, how the manager delivered the feedback and how the employee improved. Over time, this new system gives employees transparency, improvement and guidance regarding how daily activities achieve performance goals.

Constant feedback keeps employees and managers engaged in regular tasks. When someone receives encouragement, coaching and instruction on a regular basis, both the employee and supervisor collaborate to take responsibility for the employee's future. One way to do this is with self-appraisals for each worker. When employees give accurate evaluations of their own work, it ensures they develop and reach their own goals on their own terms.

Honest feedback keeps a performance-management system working properly, so supervisors and subordinates must use the software accurately to get the best results.

Showing Results

How does all this computerized information come together to show results? A computerized rating system, using a number scale, creates a graph showing where an employee stands with regard to performance and possible promotions.

Deloitte created a system whereby each worker appears as a dot on a graph. The dot summarizes a person's overall performance. When the program groups the dots together, it creates a model that picks out the employees best suited for a promotion. The dots, or snapshots, compile information from performance evaluations into quantifiable data that human resources can use.

Similarly, performance-management software should have some way to label an employee's performance. Information compiled over one year can give department heads an idea of who should earn a promotion, who needs more time in a current position and who deserves a pay raise. Once everyone knows how to use performance-management software, the investment starts to pay off with better decision-making skills.

Invest Now for Savings Later

One of the major concerns surrounding performance-management software is the up-front cost. Couple that with a company culture that may be resistant to change, and a business may find it hard to adopt new strategies for performance management.

A cross-industry analysis by SuccessFactors, conducted for PricewaterhouseCoopers, reports that its software could help decrease a company's turnover by 13 percent, increase its completion rates by 15 percent and improve its productivity by 3 percent. All these figures add up to lower expenses, greater revenue and increased profits.

Decisions with regards to revamping the performance-management system start with the upper echelons of a company. However, everyone needs to embrace the new program to make it function effectively.

Ways to Get Everyone on Board

Gamification and regular rewards are two ways to get workers on board for new performance-management software. Games and friendly competitions make hard work more fun for everyone. Gamification is like a fantasy sports league with weekly winners; this could turn into a year-long quest for a league championship. The best workers who plug into the games and do well win the best prizes, although anyone who does well should get something.

When workers do well, they should earn regular rewards. PricewaterhouseCoopers notes that 41 percent of millennials like to receive monthly rewards or recognition. These workers also enjoy constant engagement, regular feedback and employee development. The entire labor pool continues to shift toward younger workers who love technology and constant encouragement. Somehow, annual reviews are still the norm, and have been the norm, for 50 years despite dramatic shifts in how people work.

Businesses must adapt to keep pace with technology, consumer demands and different ways of making money. Performance management systems and software are one way to take employee evaluations to new heights. Despite the large investment early on, these software systems are well worth it to keep employees engaged, happy and moving forward on the path to prosperity.

Photo Courtesy of NewlyCorporate at


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  • Jacqueline Parks
    Jacqueline Parks

    I love the idea of using the latest technology to provide more timely feedback in the workplace. If neither management nor employees are benefiting much from traditional performance review model, it is time to move onto something new. I think constant engagement would both improve employee performance and motivation by helping employees see how they are connected to the success of the company.

  • Nancy Anderson
    Nancy Anderson

    @Duncan great idea in theory but most companies only do performance reviews once a year. This is why it is so important, as an employee, to keep track of your accomplishments throughout the year so that you have them ready to go when it's review time. @Mike sadly that is the way things are today - even with performance reviews. It seems that one group of workers always gets the highest reviews and always gets some kind of increase in salary or other benefits. I always felt that this was unfair that the ones who are more visible, such as the technical team, gets raises and/or bonuses all year while those who do the drudgery every day are told - maybe next year. Honestly I have seen this over and over again and it seems to just be the nature of the beast.

  • Mike Van de Water
    Mike Van de Water

    I agree that annual employee reviews should probably fall by the wayside now that technology has improved, but how do you normalize scores in a computer program when you're dealing with multiple managers, all of whom have their own "scoring" patterns? It would be terribly unfair to favor a certain group of workers simply because their boss inflates their numbers.

  • Duncan  Maranga
    Duncan Maranga

    I think it's true that carrying out a conclusive performance review at the end of the year comes with lots of financial and managerial impediments for the organization. In case some thing did not go right at the beginning of the year, its adverse effects could actually maim the company for the rest of the time before another review is done. It is therefore very wise to implement data collection through modern technology so that reviews are done every so often for real-time handling of issues.

  • Nancy Anderson
    Nancy Anderson

    @Katharine maybe not constant feedback but what about quarterly? That is typically the best way to stay in touch - find out how you are doing or things that have come up that you wish to discuss as well as discussing performance. This way, if there's an issue, it can be corrected sooner rather than later. If there is an issue and you don't know about it, it could prove to be detrimental on your annual review. Receiving constant feedback truly does seem to be too much. Again, we are all adults in the real world. We should not need constant reassurances or feedback. We know if we are doing well or not. If we are not, the manager is sure to let us know!!!

  • Hema Zahid
    Hema Zahid

    It would be great to receive regular feedback from management instead of finding out at the end of the year that you’re not doing your job well. Weekly or even monthly feedback gives a worker the knowledge she needs to improve her skills quickly and also lets her know if she needs to start looking for work elsewhere. In both cases, constant feedback helps the worker.

  • Katharine M.
    Katharine M.

    It seems that the proposed model of constant feedback would rely heavily on the cooperation of the supervisor to keep providing feedback. For one thing, it seems like it would just add a lot to a supervisor's plate. Also, if there isn't a set time of year to give feedback, the amount of feedback different employees received would probably vary wildly. The constant feedback plan doesn't seem to have enough structure to it to be feasible.

  • Christopher Brooks
    Christopher Brooks

    As a former VP of an organizations division, yearly pay increases and bonuses were tied to the yearly performance reviews. Whether one believes it is right or wrong, it continues to exist in most companies today. However, I do believe that quarterly "snapshots" be performed in a constructive manner so there are no surprises at the end of the year. Obviously, blatant disregard for company policies should be addressed as it happens one on one so that constructive behavior can be addressed appropriately. This allows the employee to make necessary behavior changes if they so desire. Professionalism should occur for both parties and a "beat down' should never happen. Breaking the law requires the appropriate action immediately. I also believe that the employee complete a performance review on themselves and be reviewed by the manager prior to the final performance review is administered. Also, Human Resources should be consulted when needed but not be done frivolously. Personal feelings should never be a consideration without factual information. If so, the organization may have the wrong individual in a position of authority. I also believe in 360 reviews if completed correctly. Every action or inaction should be done for the good of the organization.

  • Nancy Anderson
    Nancy Anderson

    Thanks for the comments. @Lydia I agree that constant evaluation is overkill. We are all adults and we don't really need constant feedback. We know how our performance is and can pretty much see how it stacks up against our coworkers. As a worker, I think it's a great idea to keep track of your accomplishments so that, when it's time for your review, you are prepared with actual facts instead of trying to remember what you did 12 months ago. Now if your feedback from the supervisor is negative, it's time for a one-on-one discussion. This way, even though you may think that you are doing a great job, your manager can discuss what is not going right and ways to turn things around. @Jay definitely feedback should be constructive. Not one of us is perfect so we will always receive feedback that can assist us to become that model employee. It is so true that the manager has a lot of power over an employee's career and future. That is why it is so important for a manager to take the time necessary to discuss any negative issues and come up with resolutions as well as praise for the positives and how we might make those even greater.

  • Lydia K.
    Lydia K.

    I believe constant evaluation has its pros and cons. On one hand, you don't want to wait till the end of the year to find out that your performance didn't meet the grade. On the other hand being scored every week can be an ongoing stress point. What steps can an employee take if their self appraisals are positive but feedback from the supervisor is often negative?

  • Jay Bowyer
    Jay Bowyer

    No matter what type of performance review type you choose to follow — whether it's an ongoing model or a traditional periodic assessment — I think the feedback you give should be constructive. As a manager, I remember being acutely aware that my influence could either make or break the staff members in my care. I had the power to give people positive reinforcement that would help them advance, and I really loved watching the results.

  • Shaday Stewart
    Shaday Stewart

    While I personally think gamification is a great approach to performance management, does anyone feel that it can sometimes encourage employees to take shortcuts or use cutthroat practices? In businesses where the employer mainly looks at specific results as indications of success (such as number of sales, number of new client accounts), it may push ambitious workers to sabotage co-workers or go against the best interests of the team for personal gain. Metrics don't always account for what is realistically happening in the workplace, and therefore, getting the highest numbers doesn't necessarily mean an employee's overall performance warrants a promotion.

  • William Browning
    William Browning

    HR needs to think that most evaluation software has come way down in price, and now is the chance to invest in some truly good performance review software. It shouldn't be too hard to find a great program that works with a computer system that the employer already has in house. There's almost no excuse for switching to a constant feedback model nowadays, especially for large and mid-sized companies.

  • Nancy Anderson
    Nancy Anderson

    Thanks for the comments. @Abbey you know that you can always ask for feedback at anytime. You don't have to wait for your annual review. You could ask for quarterly feedback if that helps you. Most managers are happy to do this so that, if there are any issues, that can be worked out sooner rather than later. For your part, keep a living document of your tasks. If you do something for which you received high praise - say maybe you finished a project ahead of schedule and within budget - put that in your document. If you do something that it outside of the scope of your job description, include that, too. Then you can have that with you. Remember that manager is probably not going to offer a quarterly review. You will more than likely have to ask for one. @Shannon I agree - no program can take away from the personal one-on-one that is needed during an annual review.

  • Abbey Boyd
    Abbey Boyd

    I, like most other people, dread the annual performance review. I never know what my supervisor is going to remember from the past year, good or bad. I really like the idea of constant feedback. I like knowing that when I am not performing as well as expected, I am going to know sooner rather than later. It's also great to hear that a supervisor appreciates my efforts and hard work and notices what I am doing right. I think the constant feedback creates a more positive atmosphere in the long run, leaving less uncertainty.

  • Shannon Philpott
    Shannon Philpott

    The digital age is definitely changing how employers operate and communicate with employees, but the reliance on digital solutions for employee reviews can also be impersonal. I appreciate meeting one-on-one frequently with my supervisors and would hate to see this cease. In my opinion, if employers are too reliant on these type of software programs, the temptation to just email feedback or reviews instead of personally meeting could become a reality.

  • Nancy Anderson
    Nancy Anderson

    @Jane thanks for the comment. I would think that the best place to start would be presenting the idea to your supervisor. Or, write up your idea and then submit it through the suggestions box in your company. You may still get a negative response but it will at least get them to start thinking about the concept.

  • Jane H.
    Jane H.

    I've seen some industry conference symposium videos on the concept of gamification. It's an interesting idea, especially considering the widespread interest in video games among millennials. My company doesn't currently offer this kind of program, although there is feedback on projects, usually given when something has gone wrong but an occasional kind word as well. How would you suggest starting the conversation at one's company to move towards game-style performance management?

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