Improve, rather than scrap, performance appraisals

SOME of the world’s leading corporations — including Microsoft, Deloitte and General Electric — are streamlining or dropping their performance management systems, says Anja van Beek, vice-president for people at Sage International for Africa, the Middle East, Asia and Australia.

“This trend comes from a growing perception that annual performance reviews might not be the best way to manage and improve performance in the workforce,” Van Beek says.

But research by corporate management company CEB HR Leadership Council has found that many of the companies that abandon the system have seen a noticeable decline in productivity.

What is clear is that companies need a better way of implementing the system. Van Beek has this advice:

Cancelling performance reviews means there is no formal structure allowing employees to set goals and managers to monitor advancement. Rather than treating it as a dreary exercise in complying with policy, we must think about how we as leaders and HR professionals can drive a culture of continuous feedback, where every interaction can build commitment, engagement and productivity;

The once-a-year appraisal is not helpful — a PwC study found that about 60% of respondents wanted feedback every day or every week. This makes enormous sense — employees should be learning all the time, their managers should be constantly providing feedback . . . and encouraging positive behaviour to ensure the employees’ performance and goals are in alignment with its strategic objective;

The process needs to be transparent, and the goals set should be linked to the overall strategy of the business; and

Cut back on the bureaucracy. A confusing 10-page document saps everyone’s morale. Stressed managers and their overworked teams do not need another reason not to participate. — Margaret Harris