Team Performance

Why Annual Performance Reviews Don't Work | The Case for Constant Feedback

Post by
Sabina Reis
Reading Time:
3
min
Why Annual Performance Reviews Don't Work | The Case for Constant Feedback

Anyone who has the privilege of managing employees also has the responsibility to provide feedback and appraise their team’s performance. However, if this evaluation is only conducted on an annual basis, it becomes ineffective - sometimes even demotivating for employees. This leads managers to search for alternatives to unproductive annual reviews, and introduce more regular check-ins with their teams. 

Consistent 1-on-1 meetings provide managers an opportunity for 2-way feedback that when done frequently, gives an accurate representation of their teams health and performance. 

The function of traditional performance appraisals.

Most people have experienced the dreaded performance review at some point in their lives. Whether on the giving or receiving end, it’s usually an unpleasant, awkward, and strained meeting that some managers are required to do at least once a year.  

These formal meetings are meant to quantify employee performance throughout the year. Some basic functions of annual reviews are to (1) provide information to managers of which they may judge future career prospects and salary, (2) to provide adequate feedback regarding employees’ performance, and (3) to serve as a basis for modifying or changing behavior. 

Although these appraisals are well intentioned, their structure, and execution are flawed. Even so, annual performance reviews are not a complete waste of time. A study found that 14% of employees strongly agreed that their annual reviews inspire them to improve in their work projects and performance. This means that the majority of individuals do not find annual appraisals particularly helpful, leaving much to be desired in the way of feedback.

Why performance appraisals don’t work. 

If the goal of performance appraisals is to adequately understand each employee's contributions over an extended period of time, then annual reviews are definitely not an efficient way of going about it. It’s impractical to fit an entire year's work into one short meeting.

Too much time in between meetings

The best managers understand that feedback needs to happen on a constant basis for innovation to thrive and performance to actually be affected. If feedback is only happening once or twice a year, it's unlikely to promote employees performance and motivation in the long term. 

With such a large gap in between annual reviews, it forces managers to recall performance based on their recollection and impressions of the employee. It is human nature that allows negative experiences to leave a stronger impression than positive ones and annual reviews tend to reflect that as well. Not only is this unfair to the employee, but also is an extremely ineffective way of measuring performance and guiding progress in teams. 

Too many tasks to complete 

Performance reviews try to achieve too many tasks in just one conversation. Typically these meetings include multiple topics like behavior, goals, results, challenges, and feedback. It’s  no wonder that annual reviews feel rushed and superficial, amounting to little change actually occurring. 

Since these meetings have a wide variety of topics to discuss, annual reviews can easily become an excuse not to touch base with employees for the rest of the year. 

Subjective rating systems 

In addition to the copious list of discussion topics, performance reviews typically include a structured grading system that is intended to rate the employee numerically. Often, the ratings given to an employee may differ based on managers’ own interpretations of ratings. Think back to your school days, there are still tough graders in the workplace and without justification.

The rating systems that many reviews have in place are not often conducive to a holistic picture of the employee, nor do they help employees improve, which is after all the intended purpose of performance appraisals. Any rating short of perfect can actually become incredibly demotivating for employees and run the risk of decreasing subsequent performance. 

Regular and consistent feedback is key.

In contrast to the hurried feedback during performance appraisals, exemplary leaders find that frequent meetings (think weekly or bi-weekly) and a high importance placed on feedback can be much more affirming and motivating than an all-encompassing meeting once a year. 

In favor of more frequent and meaningful conversations, holding scheduled 1-on-1’s provide ample opportunity to coach your employees, touch base on their projects, and receive enough information to judge future job opportunities. It is a method for managers to check in with their team continuously, rather than giving a subjective 1 - 10 rating many months later. 

Because of their frequency and structure, 1-on-1 meetings are one of the best team management tools a manager can employ. Any issues or concerns in employee performance can be addressed during the time of occurrence, placing you in a better position to improve future behavior when it’s actually relevant. 

Conclusion 

Annual performance reviews are becoming outdated as more managers realize the unmatched value of frequent meetings and feedback. Using a team management tool like Simplteam helps organize your 1-on-1 meetings and get honest, reliable feedback that helps you coach your employees effectively.