What happens when you ditch the annual appraisal process?

The annual appraisal process is changing.

While it has been a whisper in the HR community for a while, we were surprised that 66% of organisations still arrange annual appraisals; with only 25% of organisations considering moving away from this structured process, and a marginal 11% making the step to move towards a continuous performance model, the process is a slow-moving one.

Time and time again organisations are finding that annual appraisals do not improve performance – they can even make it worse! Employees can use the yearly opportunity to vent their gripes from the past 12 months, or use the meeting to attempt to negotiate a pay rise. When meetings are scheduled just yearly, both employees and managers try to fit too much into the conversation, and key achievements or areas for improvement are lost amidst more recent or memorable events.

Conversely, performance management entails frequent ‘check-in’ meetings which can be as short as 15 minutes in length, in order for managers and employees to discuss progress and personal development, priorities and objectives, issues or concerns, and agreed action points. These meetings can be arranged at the point of need, making them time-relevant.

How to engage hearts and minds for the change

Implementing a new culture of performance management and a performance management system requires careful change management; employees and managers must both understand ‘what’s in it’ for users, and what is expected of users.

HR teams should actively promote the simple tracking facility of objectives, feedback and check-in meetings, being aware to separate administrative aspects from developmental aspects. Employees should understand that check-ins are to monitor their development and progress, but this is not necessarily benefits-driven; their development is for their own advantage and will not necessarily lead to salary-based conversations.

Furthermore, performance management software should be promoted as an inter-departmental tool; employees can request feedback from all colleagues, not just those that they work with departmentally. This can aid a manager’s understanding and provide a holistic view of the wider working relationships beyond departments that they may otherwise not have a gauge on.

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To engage the hearts and minds:

  • Arrange ‘show and tell’ sessions: gather colleagues together to have sessions to investigate and ‘play’ with the system. This will allow them to voice their thoughts whilst giving HR teams an insight of where performance management will sit within teams.
  • Ensure management buy-in at every level: when implementing a performance management system, engage with managers first. They can promote the software to their teams, explaining the benefits and the closer relationships they will maintain as a result.
  • Communicate the benefits: once managers have had the opportunity to share the upcoming change to their team, ensure that you promote the benefits of the system – help employees to understand that performance management is in their best interest for their personal development.

Quality and quantity

Why compromise on one or the other? With performance management, you can ensure that the quality of the conversation is retained, with conversations focused around specific areas – whilst scheduling frequent meetings to ensure that communications are time-relevant.

Performance management software, as a tool, enables businesses to grow and employees to develop.

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