A recent survey shows that six percent of Fortune 500 companies have revamped their traditional annual performance reviews and rankings, and many more are expected to follow. Accenture, Deloitte, SAP and Kelly Services are the latest to join Juniper, Microsoft, Adobe, and Gap in making their traditional review and ranking processes extinct.
These companies have indicated that they have found that their performance review program was ineffective, onerous, costly (in the millions), and not positively received by employees or managers. Not the ROI they were expecting.
This change also reflects more closely the cycle of our culture and business. The world doesn’t run on an annual cycle anymore. With the innovations of smart phones and apps like Facebook and Instagram, people have grown accustomed to real time feedback. Employees are responding to more informal and frequent check ins, rather than a once a year conversation about past performance, that include examples that may or may not even be remembered. Managers feel this gives them better opportunities to develop talent in real time conversations about the strengths and goals of the employee. Managers have found removing this laborious and time-consuming practice has also removed a great deal of the awkward relationship dynamics surrounding once a year performance appraisals.
Are you ready to revamp your performance review program?