Employees are the key to a company’s success and it’s HR’s job to empower them.
- Businesses often struggle to attract, engage, and retain employees.
- Most employees feel that their organization’s performance review process is ineffective.
- Performance reviews are an opportunity to engage, inspire, and empower employees – but only if they’re done well.
In this era of high turnover, companies often battle to keep employees for more than 6 months. The employees they are able to retain may then struggle to engage with their work – up to two-thirds of American employees say they are actively disengaged.
Performance reviews can help combat such low retention rates and disengaged employees. Yet, most companies rely on outdated performance review techniques which are painful for all involved. These stats speak for themselves:
- 45% of HR professionals do not think annual performance reviews paint an accurate picture of an employee’s work. (Source: CoreAxis)
- 9 in 10 managers are dissatisfied with their company’s approach to annual performance reviews. (Source: SHRM)
- 44% of surveyed employees feel that their manager or supervisor was dishonest during an annual performance review. (Source: SHRM)
Three reasons traditional performance reviews are ineffective:
There are many reasons traditional performance reviews no longer work (and perhaps never did). Here are just three of them.
- Emphasis on Pay. Traditional performance reviews are almost always tied to compensation. Attempting to drive high performance by dangling money in front of an employee discourages transparency. Compensation-focused performance reviews are demotivating.
- Frequency: Yearly performance reviews only allow managers to reward excellence or provide feedback relevant to employee growth retroactively, rather than in the moment. Real-time praise and feedback can make a world of a difference.
- One-sided: Most annual performance appraisals are led by a manager who suggests ways to improve employee performance. Preferably, feedback is shared by both sides so everyone is clear about expectations, objectives and goals.
“It helps to view the performance assessment as a chance to build a healthier, happier relationship for both employee and employer, HR experts say. Instead of making a performance review an annual dressing-down, use it to identify areas where the employee is most passionate and competent, and figure out how to tailor his or her tasks to those areas.”—SHRM
Instead of abandoning the practice of performance reviews – as some have suggested – we believe we can fix the process. When executed well, performance reviews provide considerable value to a business and its employees.
So, what’s the first step? To start, the HR Department needs to take a cue from the Marketing Department.
HR has a lot to learn from marketers.
For the first time in history, there are five generations in the workforce, each with their own set of unique characteristics and work styles. Learning how to communicate with each generation effectively is a challenging but critical undertaking. To use performance reviews as a tool to empower employees, you have to understand who you are talking to.
Contemporary marketers use data-informed tactics to delight customers and nurture their journey from awareness to consideration and, ultimately, to action. As an HR leader, you can apply this same methodology to understand each generation in your workplace and create a more personalized performance review process.
Implementing tactics borrowed from the Marketing Department helps HR to:
- Understand the unique characteristics of the multi-generational workforce.
- Create employee profiles based on each generation in your workplace (marketers call these personas).
- Diagram stages of the employment journey and establish touchpoints specific to each persona.
- Devise generation-specific review frameworks.
- Engage and inspire workers across generations and departments.
Highly-skilled workers want to be treated as individuals – not as tiny cogs in an extensive system. Your performance reviews will take on a new life when you understand the unique character of each generation in the workplace.
More tips to help transform your performance review program:
- Schedule check-ins two to three times during the year instead of the traditional (and all too short) one-hour annual review.
- Build performance reviews around your employee’s goals and schedule your check-ins around important deadlines (deadlines established by each employee).
- Don’t be fearful of tough conversations and don’t wait too long to have them (it’s ok to schedule a conversation outside of your review framework).
- Ask employees for feedback on your performance. After all, this is about opening the lines of communication and building trust.
- Outline the process and expectations of your revised performance review program and make it accessible to all employees.
Sticking with a traditional approach to performance reviews may leave your employees feeling disengaged and unproductive. Rather than abandoning the process altogether, you can turn the performance review into a tool that empowers every person in your company.
Click here to download Sentric’s Performance Management Overview and Performance Review Checklist!