Are Performance Reviews on the Way Out?
Traditionally, the performance review was a staple part of the HR process as a key way of providing feedback and creating a dialogue between manager and employee.
However, as we move into a new era of technology-enabled workplace, performance reviews seems to be on their way out as the practice is slowly becoming less widespread and many companies are abolishing the practice completely.
Can these sessions still have a positive effect and how can HR management software play a part in modern performance management?
Performance reviews falling out of favour
According to a recent survey conducted by Office Space, most firms (52 per cent) conduct an employee appraisal on an annual basis. However, only 12 per cent of companies conduct a review every quarter and 15 per cent run performance review on a biannual basis.
While 95 per cent do in fact conduct a performance review of some kind, 11 percent of HR leaders believe they are not effective. Among workers, this proportion rises to 25 per cent.
An August 19 article published by the Society of Human Resource Management pointed to a number of notable companies that have done away with traditional performance reviews, including Accenture, Microsoft and GE. These companies now focus on more immediate feedback systems and informal conversations.
Rethinking the performance review
Research from Kansas University highlighted that performance reviews may still have the potential to bring positive changes, provided they are conducted in the right fashion.
Not matter if an employee is learning-oriented or performance-oriented, hearing negative feedback in a formal review often leads to dissatisfaction and can leave an employee feeling unmotivated in the future. Feedback should be delivered in a way that sets a clear pathway for future success.
Lead Researcher Satoris Culbertson explained that modern HR professionals can no longer use a performance review in isolation and that they need to carefully consider new way of encouraging good performance.
“Instead of limiting ourselves to formal performance appraisals conducted once or twice a year, we need to think about performance management as a system that is linked with the strategy of the entire organisation,” she said.
Investing in HRIS software can be an effective first step in revitalising your performance management system. Collecting data and metrics can give your feedback sessions more weight and allow you to see which systems are delivering the best results in employee performance.