May 23, 2013 | Blog

The Annual Resentment Process?

Engage Your People
Develop Your Workforce

Corporate America has a problem:  the annual performance review.

 

Usually, this process starts with a self assessment, then a manager assessment, then a manager reviewing employee feedback with his or her boss. Finally, months later, an employee-manager follow up discussion is held. All of these steps typically require employees and managers spending days completing formal write ups, trying to remember every significant detail of their work over the past 12 months. And although most would never admit it in public, most managers and employees complain about this as if it were an annual root canal rather than a review.

 

Organizations and leaders need to stop the madness of the annual review process. It is not driving employee development and there are two key reasons why:

 

  • The world is too dynamic for an annual review process to be of real value. The one constant in today’s world is change. Goals change, employees change, expectations change, personal situations change, business circumstances change, and the list goes on. Annual reviews are just too stagnant and backwards-looking to be of real value. Feedback is most effective when it is immediate, and the most effective coaching comes from a constant and iterative process. The structure of the annual performance review misses the mark on both of these facts.
  • The goal is more about documentation than employee development. When you are objective about the goal of the annual review process (come on, be honest with yourself), you realize that it’s more about systematizing information than employee development. It is a formality that allows organizations to mitigate risk by providing documentation that there is a review process and feedback was provided. While there are many legitimate reasons to have this sort of evidence, let’s not fool ourselves into thinking that this effectively supports the employee development process.
So what is the alternative?  The truth is, it depends on the organization. But there are certain constants that apply everywhere. All organizations need a living and breathing development process that should be guided by the following six key principles:

1) Managers and employees need to trust each other – Two way feedback is essential. Furthermore, the documentation process should be focused only on 5-7 key bullets. The other details should stay confidentially between the manager and the employee.

2) Development should incorporate a multi-method approach– Coaches coach every day at practice, not just in the final game. Formal performance review processes should simply  complement to other constant and fluid feedback mechanisms such as recognition and rewards, stretch assignments, and collaboration with peers.

3) Timeliness is critical – The larger the time gap, the less you will be able to connect employee feedback with actual behavior change. At a minimum, monthly reviews are a must.

4) The employee, not the manager, ultimately judges the effectiveness of the review process – Employees should be solicited in a meaningful way on how they perceive the quality of the process. Whether you agree with the employee or not, if they don’t perceive the process as valuable, then they won’t change their behaviors.

5) The role of the senior leaders is to ensure a productive development process –The direct supervisors of managers need to be the check and balance to ensure that the employee perception and manager feedback is in line and productive.
6) Human Resources’ role is to train and facilitate – Human Resources should provide essential manager training and should serve as an active and objective facilitator throughout the development process.

 

Each organization is different but if we build processes that ensure these principles are being met, we will be infinitely more effective at developing employees. Drive a better dialogue around alternatives to the annual performance review process in your organization. Our most critical asset, our people, are counting on it.

 

 

Fabio Malagisi is a Finance Manager at CR Bard in Boston, Massachusetts. He is an ambitious and results-oriented professional with a proven track record of being a business partner, driving results and improving the bottom line through effective business decision making. His expertise in finance is demonstrated with an exceptional background in providing leadership across multiple and diverse global operations. He is a proven leader and mentor that actively develops talent pipelines and builds effective team. He has a passion for employee and leadership development and can be connected with on twitter under @FabioMalagisi.