Making the shift from administrative paperwork to meaningful performance management.

Times have changed and the way we work has changed, but for many organizations the performance review process unfortunately, has not. Managers in organizations across the globe dread review time because it is seen as “annoying administrative paperwork” that they can’t wait to check it off their list. Employees want the feedback, but many have become disenchanted with reviews lacking substance given by managers who a) may not know how to conduct an effective performance review or b) simply aren’t engaged in the process.

It’s time for organizations to review their review process.
In addition to the negative perceptions of performance reviews that have permeated the workplace, the way we work has changed. In the today’s knowledge economy, most work is team-based while performance reviews remain focused on individuals. The way companies operate and organize their workforce has changed. So, why are our performance assessments the same? Even if you’ve moved the process online, are you asking the same questions and measuring the same attributes? And further, are managers across your organization properly trained to conduct reviews consistently and effectively?

Reviews that have a direct correlation to company objectives and performance while providing a coaching and mentoring environment are the most effective in today’s evolved workplace. Organizations that want to create a high-performance culture and develop the next generation of leaders need to re-think their process while re-invigorating their managers to look at performance assessments in a new light.

Many companies have come to us seeking guidance on how to strengthen, or maximize the outcome of the performance review process. Although there is no one size fits all solution, there are some fundamental guidelines we believe any organization can benefit from when re-evaluating the review process.

Create a cultural shift.
Management teams at many companies we work with understand they need to initiate a significant perception shift of performance reviews within their organizations in order to make them more effective. Leaders must make tangible changes to the process while rallying managers to make the mental leap away from thinking of reviews as that “awful administrative paperwork” that comes around once a year.

The ultimate objective of creating a cultural shift is to help managers understand how to leverage them as a tool to help boost business performance. Performance reviews can help organizations identify their next crop of leaders, areas where the employees need extra support or training and, importantly, where management itself needs to strengthen its own skill set or strategies. A cultural shift is only possible if there is continuous, candid feedback and meaningful analysis of what the reviews are actually saying. Management teams need to be a part of this dialogue, engaged in the entire process and its results.

Train your managers.
In many organizations across various industries or sizes, people often move up the ladder because they are good at what they do (sales, marketing, finance, etc.), not necessarily because they are good managers. When people are promoted to management positions, management training is sometimes overlooked. Since performance reviews are an important element of talent management, companies should take a close look at how they are guiding and training managers (especially newly minted ones) on providing effective feedback.

Do your managers understand how performance reviews are tied to company objectives? Are they clear on how they should consider team dynamics vs. individual performance? Do they know how to manage and filter 360 degree reviews? Is there consistency across the organization on how the reviews are conducted, reported, tracked and utilized to make decisions on promotions and salary increases? These are just some key questions that a solid training program can help your organization and your managers address before they embark upon this important process.

Some performance review training program elements you can incorporate include role-playing an actual review or implementing a regularly scheduled open dialogue before “review season.” This will allow managers to discuss the challenges and benefits of last year’s process while articulating and what you’d like to get from this year’s. Listening skills should also be incorporated into the training, focused on listening and watching for important cues from employees.  

Better align strategic business objectives to individual performance goals.
A key element to more effective performance reviews is being able to tie them to strategic business objectives. Reviews tend to focus mainly on individual performance and then explore softer, more broad questions like Does this person embody our organization’s ethics and values? If you set goals in the context of business objectives in performance reviews and development plans, the manager and the employee are able to more clearly align their actions.  However, mangers must also remember to refine performance metrics as the business strategy evolves over time.

Once the goals are set between manager and employee, it’s helpful to outline a detailed action plan on how to achieve them and provide measurable milestones for you and the employee to monitor. This way, managers can more effectively leverage the performance review process as an opportunity to provide a clear understanding of individual goals and how they contribute to the larger organization in both the short and longer term.

Start planning today!
The War for Talent survey by McKinsey & Co. reports also showed the most important corporate resource over the next 20 years will be talent. If you start by focusing on creating a cultural shift within your organization that leverages performance reviews as a valuable asset you are on the right path in achieving more effective talent management. The time, energy and resources invested to help strengthen your review process, will be time well spent.