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January 09 2013

Are Performance Reviews a Waste of Time?

By David McMillin, Staff Writer

performance reviewIt happens in offices across the country at the close of December or the beginning of January. Employees talk about how they feel they’ve done throughout the past year. Managers weigh in with their own thoughts. Perhaps there’s an incremental pay increase, and then, it’s back to work.

But is that annual performance review routine really effective?

According to a Cornerstone OnDemand survey of more than 2,000 US adults, it looks like the answer is “no” in many cases. The results show that the tradition of the annual review needs to be revisited in order to inspire better performance in the workplace.

Here’s a look at some of the key shortfalls:

  • 37 percent have been given useful feedback from their manager/employer.
  • 21 percent received feedback from their peers, in addition to their bosses.
  • 20 percent have established career goals with their manager/employer.

“Managers who simply go through the motions with performance appraisals not only risk employee retention, but also limit the success of the business,” Adam Miller, CEO, Cornerstone OnDemand, says.

If you’re serious about successful reviews, here are three tips to consider.

Mentoring Matters

While a conversation about the year’s results can be productive, managers must remember that a once-a-year discussion isn’t enough. Rather than send a calendar appointment for one big review, managers can take a more proactive approach to fostering a true mentor relationship throughout the year. Go to morning coffee or lunch with a more casual approach to discussing what’s going on in the office. Check in regularly to make sure employees aren’t feeling overwhelmed.

Colleagues Should Be Part of the Conversation

When the time arrives for a formal review, be sure to collect more than one voice. Sure, the opinion of the boss in the corner office matters, but what about the colleagues that employees work with on a daily basis? From team members who sit next to each other to those who may be involved in completing certain projects with the reviewee, performance reviews must collect compliments and critiques from a range of perspectives.

“While a lot of organizations are set up as hierarchies, how work actually gets done is in more of a matrix-based structure,” Miller says. “With this in mind, it makes sense to allow for reviews from peers, project leaders or clients that people work with on a daily basis.”

Looking Long-Term

While the year ahead may be the most pressing issue for the organization, it’s important to remember that career growth is a crucial piece of employee retention. Rather than focusing solely on what employees can do in the short-term, an annual review presents an opportunity to discuss the future. Where does the employee want to be in five years? Is the organization offering real opportunities for advancement? An annual review can be more than a look back; it can create a conversation about looking forward to the shared success of your organization and your employees.

For tips on performance reviews from an employee’s perspective, read this article from Monster.

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