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The Case for Re-thinking the Performance Review Process

Today's post comes to us from the executive director of The Workforce Institute, Dr. Chris Mullen, Ph.D., SHRM-SCP, SPHR.

I recently read a statistic that blew my mind: “According to a survey of 48,000 employees, managers and CEOs by the leadership training and research firm, Leadership iQ, only 13 percent of employees and managers, and 6 percent of CEOs, think their organization's performance appraisal system is useful.”

I can't say I'm surprised by the 13 percent number: when was the last time you heard any employee say, “I'm so excited for my performance review!”? Or any manager say, “My favorite part of being a manager is writing performance reviews each year!”?


But 6 percent of CEOs!?! That's actually shocking to me, because that's pretty darn close to zero, and if the vast majority of head decision-makers at companies think performance reviews are useless, why hasn't anyone done anything to make them more useful?

If there was ever a time to re-think the performance review and figure out how to make it useful, meaningful, helpful - all the “fuls" - now is the time. In the last year, COVID-19 impacted just about every person's job - whether you were hunkered down at home or had to be there in person. We're re-thinking so many aspects of work at this time: office space, flexibility, talent acquisition, wellness programs, it just makes sense to re-think performance reviews and performance management as well.

We've had some wonderful posts from our board members over the years about how to make performance reviews better - here are just a few: 

The Problem with Making Performance Management Just Another Managerial Task: This post from John Hollon cites research from Gallup that found the performance management process to be “irrevocably broken”, especially in light of the COVID-19 pandemic. John argues that the keys to effective performance management are ongoing conversations, timely recognition, and informal dialogue on a weekly basis.

The Key Ingredient for Effective Performance Management: This post from Dennis Miller notes that corporate research and advisory firm CEB found that only 4 percent of HR managers think their system of assessing employees is effective at measuring performance, while 83 percent say their systems need an overhaul. Dennis outlines some ideas on how to do this most effectively.

Sharlyn Lauby on Managing Performance: This podcast with Sharlyn Lauby focuses on what organizations can do to get performance management right. Sharlyn discusses the issue in the context of her chapter in The Workforce Institute's most recent book, Being Present:  A Practical Guide for Transforming the Employee Experience of Your Frontline Workforce.

Upping Your Employee Feedback Game: Former Workforce Institute executive director, Joyce Maroney, highlights the need for more timely feedback and provides "how-to's" for having those difficult conversations that can often derail a good performance management strategy.

Analytics Moves HR Towards Being a Strategic Partner: In this post, Neil Reichenberg reports on research that looks at where HR professionals are implementing HR analytics programs at their organizations and finds that one of the key areas is the performance review process, noting that the use of analytics can lead to "Increased completion rate of performance evaluations, assisting to switch to a goal-oriented evaluation approach, and facilitating the use of more frequent performance discussions."

Do you think the performance review process at your organization is useful? How could it be better? Share your thoughts in the comments!

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