Is it time to toss out the annual performance review?

We work with several startup companies and many of their founders spent some of their professional lives working for larger corporations before starting their own businesses.  They come from a wide range of backgrounds and experiences, but there are a couple of things that they have in common.  One is that they didn’t love having a boss.  The other is that, they hated… and I mean hated… their performance review process.  In fact, the whole ‘pay-for-performance’ tag line makes their eyes roll.

But the question remains, if we don’t have an annual review of ‘the what and the how’ what do we do instead?  How do we ensure that we reward our top performers and don’t lose control over the payroll budget?

If you’re thinking of changing your performance review process, here are a few key questions to help you get the conversation started.

  • What are we trying to achieve?

  • How will we identify, recognize and reward great work?

  • How will we reinforce individual interest in the business success?

  • How often are we going to talk about it?

  • And how often are we going to document it?

  • How much are we prepared to spend (in time and money) making the change?

Changing the performance management process is a project.  Start by identifying the business needs that the project will achieve and structure a business case to define the goals, plan and costs for the change.  If you really want a performance management process that works for you, invest the time and effort to implement one that meets your company’s unique organisational, cultural, and financial requirements.

Additional reading:

Screen Shot 2016-06-30 at 4.28.35 AM
McKinsey Quarterly, “Ahead of the curve: The Future of Performance Management”
Washington Post: In big move, Accenture will get rid of annual performance reviews and rankings
Washington Post, “In big move, Accenture will get rid of annual performance reviews and rankings”
Forbes: Need A Career Tuneup? Gallup's Tom Rath Has A Quiz For You
Forbes, “Need A Career Tuneup? Gallup’s Tom Rath Has A Quiz For You”
CIO: How to improve employee performance by focusing on strengths
CIO, “How to improve employee performance by focusing on strengths”

 

 

 

 

 

 

 

 

This article is provided for general information purposes only and is not intended to be human resources consulting advice or specific advice for your business needs.

© 2016 Allium Consulting Group, LLC.  All rights reserved.