Do employee performance reviews get the best out of people?

23rd January by Karen Smart

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Performance review season is here again which makes it the perfect time to ask if they really do get the best out of people? The shortcomings of traditional annual performance appraisals are becoming increasingly evident. As businesses seek more agile and effective ways to manage talent, a shift towards continuous performance management is proving itself a gamechanger.

Here we delve into the importance of regular reviews, coaching conversations and high-quality feedback from managers as pivotal elements in creating a dynamic and thriving workplace.

Annual appraisals are not fit for purpose

The conventional annual appraisal is becoming a relic of the industrial age. It falls short in meeting the demands of the contemporary workplace. That once a year ritual has been singled out by many, including Gallup, for making its presence negatively felt with employees experiencing increased anxiety and stress levels which can hinder creativity and productivity.

Recognising this, organisations are turning towards continuous performance management, a model that emphasises ongoing communication and feedback. This shift not only dispels the anxiety or fear associated with annual reviews, but also encourages a culture of transparency and collaboration.

Performance management is an ongoing process

Continuous performance management integrates regular reviews into the fabric of everyday work life. Rather than relying on a single, comprehensive and high-pressured assessment at the end or the beginning of the year, employees and managers engage in frequent check-ins, allowing continuous feedback and development.

These regular reviews provide employees with real-time insights into their performance and replace anxiety with a sense of self-awareness and accountability. It enables managers to identify and address issues promptly and, ensure that performance remains aligned with organisational goals.

Coaching can play a fundamental role in the success of continuous performance management schemes. Unlike traditional appraisals that focus on past achievements, coaching conversations are forward-looking and focused on individual development and goal setting. Managers, acting as coaches, support employees in understanding their strengths and areas for improvement and fostering a sense of ownership over their career paths. A coaching approach not only enhances employee engagement, but also empowers individuals to take charge of their own professional growth.

Now, let’s draw the connection between performance management, coaching and the indispensable element of high-quality feedback.

Good quality feedback is an investment in engagement and retention

The significance of line managers in the continuous performance management and coaching process cannot be overstated. High-quality feedback from managers is essential for employees to grasp how they are performing and what is expected of them.

In the traditional annual appraisal format, feedback is often delayed and limited, hindering immediate improvement. Continuous performance management promotes a culture of timely, constructive and actionable feedback which helps facilitate a deeper understanding of performance expectations and encouraging skills development.

Quality feedback is a linchpin that helps elevate continuous performance management and coaching to new heights. It provides employees with actionable insights, acknowledging their strengths and gives a dusting of guidance on areas for improvement. This feedback loop ensures that the coaching conversations are grounded in reality, addressing current challenges and opportunities. Good-quality feedback, delivered regularly reinforces the coaching process, creating a continuous cycle of improvement and growth.

Furthermore, coaching conversations between managers and employees provide a platform for more open dialogue. These discussions go beyond performance metrics, addressing the individual needs, aspirations and challenges of the employee. By fostering a coaching culture, organisations build stronger, more supportive relationships between managers and their teams. This approach not only enhances communication, but also contributes to employee satisfaction and proven retention, vital factors in today’s competitive talent market.

In essence, the synergy between continuous performance management, coaching and high-quality feedback positively shapes the employee experience. The emphasis on regular reviews and coaching conversations nurtures a culture of growth and development, aligning individual aspirations with organisational objectives. Line managers armed with the tools of coaching become catalysts for positive change, guiding their teams towards success.