Managers Spend 210 Hours On Annual Performance Reviews, On An Average

by Srikant Chellappa Feb 6,2020

The People Strategy Leaders Podcast

with Srikant Chellappa, CEO

In 2015, Deloitte announced that they would reinvent performance reviews based on findings that “the best team leaders revealed that they conduct regular check-ins with each team member about near-term work.”

Having frequent check-ins with your team members helps you cultivate an engaging and positive workplace culture that drives organizational productivity.

Every year, when it is time to review employee performance, managers end up accidentally ruining their workplace culture with traditional annual performance reviews. With gen Z joining the workforce, there is a need to evaluate the traditional practices for performance management.

What Is The Problem With Annual Performance Reviews?

Annual performance reviews were actually designed so that both the employees and the company could benefit from them. But most HR leaders agree that this practice isn’t just ineffective but also damaging to the organization. It is not just because of the process itself but because of the way it is being carried out.

For the longest time, annual performance reviews were the primary way for managers to communicate performance evaluation feedback with their employees.

But these reviews cost managers an average of 210 hours per year and a lot more money. Moreover, Corporate Executive Board (CEB) research has found that 9 in 10 human resource leaders are dissatisfied by the results of their annual performance reviews and believe that the process doesn’t yield accurate information. So, It is just not the employees that are dissatisfied by annual performance reviews.

A few obvious problems facing annual performance reviews are

  1. Inaccuracy Of Data
  2. The Lack Of Structure
  3. Lack Of Acknowledgement
  4. Linking With Compensation

The Solution: Continuous Performance Management

One of the things that can greatly influence employee experience is performance reviews. Performance reviews encompass a gamut of factors such as feedback, career growth, development, praise, etc, all of which have a direct impact on an employee’s experience.

As such, it is important to create a good performance review culture, especially one that makes employees feel like it is enhancing their time at the organization, instead of making them feel like they need to flee as soon as they can.

Continuous feedback is something a lot of employees long for. Consequently, employees will actually leave jobs or become disengaged because they don’t receive enough feedback. Committing to creating a culture of continuous feedback doesn’t just boost employee engagement, it will also enhance employee experience. Since it is not a habit that comes naturally to most people, it is something that will take a lot of work. However, the rewards of continuous feedback go well beyond the effort that one puts into it.

One of the emotions that performance reviews are most associated with is fear. Based on how they are conducted, performance reviews can cause anxiety, panic, anger, sadness, etc.

It is unfortunate that so many negative emotions are tied to performance reviews but it is also worth examining why we continue to use a process that is a painful affair for many people. The answer lies in the way performance reviews are usually conducted.

This is a somewhat sweeping generalization but most companies hold performance reviews annually. And in many cases, it is the only time employees receive feedback. And more often than not, employees are not prepared for the feedback they receive. No wonder they often feel surprised by the review, or even worse, are blindsided by negative reviews.

Therefore, it is important for managers to remove fear from the conversation and this can be accomplished through continuous feedback. This way, the employee knows what is coming, instead of being completely taken aback by a performance review conversation.

Also read: 8 Companies That Redefined Their Performance Management Systems

Request a demo to find out how Engagedly can help you create a culture of continuous employee feedback!

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Srikant Chellappa
CEO & Co-Founder of Engagedly

Srikant Chellappa is the Co-Founder and CEO at Engagedly and is a passionate entrepreneur and people leader. He is an author, producer/director of 6 feature films, a music album with his band Manchester Underground, and is the host of The People Strategy Leaders Podcast. He is currently working on his next book, Ikigai at the Workplace, which is slated for release in the fall of 2023.

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