Why Your Annual Performance Appraisal Process Does Not Work

Performance Reviews

I was recently talking to a friend about her annual performance appraisal. It had been delayed for a while and my friend was getting antsy. She was worried about the fact that the lateness did not bode well for her career or it meant that the security of her job was in danger. Actually, it was because the year  before, the company had grown massively in size. And managers had teams which suddenly ballooned in size. The delay was because managers were struggling to marshal their own thoughts, manage newly expanded teams while simultaneously doing their own work. Sound’s nightmarish doesn’t it?

When my friend’s appraisal finally came through, my friend was disappointed with the outcome. She got a raise but she did not get much in terms of feedback and input. And she had no means of responding to the little input she received either.

In a year, where if you assume employees work 5 days a week and include say 14 days off which are inclusive of sick leave, casual leave and official holidays, you are left with a round number of 226 days. On each of those 226 days, an employee has done something relevant enough to merit being retained by an organization and also paid monthly.

It seems impossible to condense a year’s worth of work into a meeting which does not last for more than 30 minutes, but it does happen frequently. And more often than not, the meeting in question feels like a one-way communication street where most employees can’t respond adequately to the feedback they receive.

And it is not just employees who are unhappy. Managers are too. Imagine that you want to give your employees detailed and well-though out feedback, but you cannot because you are pressed for time or because your organization’s annual performance process does not work.

Ideally, performance reviews are supposed to be helpful, not only for the employee but the manager also. But with the way most organizations tend to run them, they breed disengagement more than anything else.

I recently read a news story that was extremely illuminating to me.

This news story revolved around the American multinational conglomerate GE. Yes, it was that organization that was begun Thomas Edison.

GE was known for its annual performance appraisal process where an employee’s performance at the end of the year was brought down to a number, based on which they were judged and ranked. The employees who fell in the bottom ten percent lost their jobs.

Today, this form of performance appraisal sounds not only harsh but also reductionist. But you’d be surprised know that not only did GE promote this form of appraisal aggressively, other organizations wanted to mimic them.

This year after 30 years or so, GE did an extremely surprising thing. They did away with their annual performance review process completely. Now their experimenting with a process where frequent feedback is given to employees via an app.

For GE to do this represents a sea change in the way organizations are dealing with performance reviews. GE is not the only organization to do this by the way. Microsoft, Accenture, and Adobe to have done away with them too. Like I mentioned in the first section, there’s something inherently wrong with the way performance reviews are utilized. They are seen as tools to measure and rate employees. But that’s only the tip of the iceberg. In reality, performance reviews are more than that. The involve giving an employee feedback, taking their input and also helping them grow, not only as individuals but also as professionals. And here’s the clincher, performance reviews are not tied to pay. And neither should they be.

We must take note of one thing. Today’s workforce (and I’m talking globally) is continuously evolving. It is largely made up of Millennials, a generation who having grown up with technology expect feedback instantaneously. Technology too is evolving rapidly and a few years down the line, present technology would be outmoded.

GE and a collection of other companies dumping annual performance reviews mean that they’ve surveyed the present workforce and realize that things have got to change. A classic case of out with old and in with the new.

By now, I hope you are wondering about how you can change the way things in your organization. If not, it is something that you should worry about. You cannot hold on to outmoded practices because of tradition. Sometimes, you have to buck tradition and look to software help you out.

Specifically, Engagedly, the employee engagement platform.

Engagedly is not the only HR application that is there  in the market today. But here is what separates us from the rest. I’m not going to launch into a spiel about our values and beliefs. I’m going to show you what we have, rather.

An ideal way to evaluate an employee’s performance is to ensure you have three tools at your disposal that help you carry out the processes carried out below.

  • Instant Feedback
  • Praise
  • Goal Management
  • Engagement

A tool for instant feedback? We have it. In the Engagedly app, giving feedback is extremely easy. Just click on the icon next to Post, which shows two parallel arrows, select a user, input your feedback by clicking on the Share Feedback icon, choose whether the feedback is positive or negative and click on submit. We’ve simplified the process of giving feedback. You don’t have to jump through any forms and fill out a convoluted form. And oh, we’re not just about giving feedback. You can request for feedback too. Just click on  Request Feedback, type out our feedback, select the person you want to request feedback and click on submit. No more dithering during a meeting, wondering how to ask for feedback.

Praise is vital in an organization. We don’t want to admit it to ourselves, lest we sound vain but praise thrills us and makes us want to do better. It is a motivator and an acknowledgment of your capabilities. Want to praise an employee, click on the Feedback icon next to post, select Praise Someone, type out your praise, select a user, click submit and you are good to go.

There is an easier way to track your employee’s goals than creating them, checking back with them frequently and doing some complicated gymnastics in your head to see how far they have come. Engagedly’s goal management module is known as Cascading Goals, where you can create the primary goals and then track your employee’s results over a period of time. This makes it easier to measure performance doesn’t it?

Also Read : How To Write Good Employee Goals And Objectives

And last but not the least, engagement. The Engagedly app contains the Post feature, whose main purpose is to foster communication among employees and do away with the hierarchies that separate an employee and a manager or a CEO and a manager. We’ve also gamified communication, another feature with ensures that there is some value to communicating with others.

This is just a glimpse of how you can revolutionize the process of performance appraisals. Don’t be one of those organizations where you lose employees because your performance appraisal practices are outdated.


If you are interested in knowing about how Engagedly can change your organization, request a demo from the Engagedly team!

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