Performance reviews: why they (don’t) make sense​

Stefan Op de Woerd
Stefan Op de Woerd

There cannot be many people who actually look forward to their performance review. This is hardly surprising as who among us wants to put our fate into someone else’s hands? Especially if that person is our boss? The question is whether it can be done differently, and what would be needed for this to happen.

Here, Jochem Aubel & Stefan Op de Woerd give their suggestions for a new way of doing performance reviews.

Performance review stress

Many employees dread their performance review, and there are those who will get completely stressed out worrying about what their manager is going to say about them. The ‘manual on performance management’ leaves no room for doubt: the performance review is about one-way traffic. So, in this meeting, I am the one speaking, I will tell you what I think of you, and your role is simply to listen. Surely, this does not chime with the times we are living in?

All studies in this area incontrovertibly show that performance reviews are perceived as stressful, do not bring about better performance and certainly do not result in higher motivation among staff. It also feels really strange, as the employee, that you’ve been gone through the whole year working perfectly well with your manager and you both have an open, equal relationship except when it comes to the performance review.

So, what’s the point in having a review at all?

All to do with pay rises?

It’s quite logical: you want to reward your employees for the work they do. Someone who contributes a great deal to the success of the organisation should earn more than someone who contributes less. Seen this way, there is a strong case for having a system in place that defines this contribution as objectively as possible and for awarding any pay increase on this basis. It is then down to the manager to communicate this to employees in the performance review.

Sounds like a good idea, right? Too bad that’s not how it works out in practice. There are a number of reasons why this is the case:

  1. We tend to keep a clear picture in our minds of what has happened over the previous couple of months, but no longer. So, for a performance review in December, the last quarter will have much more weight than any contribution at the beginning of the year.
  2. An opinion often says more about the person giving it than the person whose performance is being reviewed.
  3. Organisations will tend to play safe and keep the results of reviews somewhere in the middle for the majority of people. Hardly what you’d call motivating…

So, why not get rid of performance reviews altogether?

Make performance management simple and effective?

Download our e-book “7 steps to transform your Performance Management”

Time to put an end to performance reviews?

That is what many organisations have been doing over recent years. Albeit a large number of them have since done an about-turn and reinstated the old system in one form or another. What does that tell us? That employees don’t like performance reviews, but not having a review is even worse. That people want to know how they are doing and feel insecure if they don’t get any feedback on their performance for an extended period. Fortunately, there are alternatives to the performance review.

From once-yearly meeting to an ongoing process

Why should you reflect on your employees’ contribution to the organisation only at one specific point in the year? Why is it that your manager is the only person who gives people feedback? And what is your employees’ own role in all this?

The solution lies in replacing a single, high-stakes performance review with regular 1-to-1s where employees reflect on their contribution to the success of the organisation. This dialogue should not only be with their supervisor, but also with colleagues, customers and with themselves (self-reflection). Surely, this would give a much more realistic picture, wouldn’t it? Your employees would really know how they are doing and what is expected of them. And, the great thing is these conversations – employees with their managers and colleagues with colleagues – are happening all the time anyway. It’s just that they are rarely about the goals they have set and their personal development.

Make performance management simple and effective?

Download our e-book “7 steps to transform your Performance Management”

Providing a framework for 1-to-1s

As an organisation, you can help employees and managers to keep their goals top-of-mind and to discuss them in regular 1-to-1s. How? By sending them regular updates on their goals, and by asking the right questions. Questions that prompt reflection, feedback and dialogue. This helps you provide a framework for the conversations people are already having with one another and push them in a positive direction.

OK, it’s a great story about regular 1-to-1s, but “our employees” would never go along with it. None of this is simply going to happen of its own accord, that much is true. But, there is still a lot you can do without having to put in a massive amount of time and effort.

Employees as the owner

The first step is giving employees co-responsibility for the review process. After all, if you make it clear what you expect of them in terms of the process, they are perfectly capable of doing it themselves. You can indicate the deadlines for defining goals, obtaining feedback and putting the review together. You might want to add some rules, such as the minimum amount of feedback or the questions that should be asked. Finally, you can support your employees with the right tooling to make it easy for them to take control themselves.

Sounds do-able, doesn’t it? At the same time, you will make a lot of managers – who now need to spend much less time preparing for performance reviews – very happy.

What about pay rises?

We nearly lost sight of that bit :-). Ultimately, you still want to make sure your employees are rewarded for the contribution they make to the success of the organisation. But, given they have been discussing it the whole year long, they’ll already have a clear picture of how they’re doing, won’t they? The ‘review’ bit is already out there, the result of regular 1-to-1s throughout the year.

So, who should do the review then? It no longer matters! After all, if someone’s progress is clear, the review can be done by anyone. The supervisor? Nothing wrong with that. The team? Yes, why not. The employee? How brave are you feeling?

With a few ground rules and a little faith in your employees, you have already made big strides towards a new style of performance review with ongoing dialogue at its heart.

New style performance review

If it was down to us, the traditional performance management cycle would be replaced by an ongoing dialogue focusing on goals and personal growth, the sooner the better! This way, you can empower people to unlock their best performance to further your organisation’s success.

You may well still want to hold a formal performance review, but it will have its basis in continuous dialogue throughout the year. That way you can avoid unpleasant surprises for all concerned come the end of the year.

Are you ready for the new way of doing performance reviews? In this free e-book, we show you the 7 steps to help you move to a performance management cycle that has ongoing dialogue at its heart. We wish you every success!

Jochem Aubel and Stefan Op de Woerd are the founders of Dialog, surprisingly simple software for an effective performance management cycle. Want to know more about how Dialog supports employees and managers to achieve this? Take the product tour.

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