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Major Overhaul of Performance Reviews Predicted for 2016 and Beyond

Performance reviews can incite fear, confusion, frustration, and even tears. Fortunately, the process that provokes dread from both employee and manager alike is predicted to change in 2016 and beyond. APQC’s Talent Trends Survey Report: A Positive Outlook for HR not only debunked long-standing HR myths, but also revealed the most significant HR needs and HCM predictions.

Surprisingly or not, accurate measurement of employee performance was identified as the most significant HR need by 72 percent of survey respondents. Roughly two-thirds of participants identified differentiating employee rewards by performance as significant, and over half of respondents identified the need for attainable employee performance goals. Beware—these performance goals should be neither too hard nor too easy to achieve.

Sixty-three percent of survey participants anticipate that by 2020, employees will be evaluated on results. Additionally, over half of the participants anticipate that pay for performance will be the dominant form of compensation. These HR needs and HCM predications translate into a clear message: a major overhaul of the performance review process is coming.

The survey clarified the fact that organizations want and need to do a better job of accurately measuring employee performance. Also, it pointed to the need for organizations to move toward a method of differentiating rewards based on individual employee contributions. But, how can organizations turn these “needs” and “predictions” into reality? To transform the performance review process, organizations need to:

  • align employee goals with organization objectives;
  • drive employee performance on a day-to-day basis;
  • establish consistent times and methods for assessing performance;
  • assess both job performance and growth potential;
  • facilitate useful communication between managers and employees;
  • support managers in delivering constructive and accurate feedback to employees; and
  • reward performance with increased compensation and training.

To learn more about improving performance management, visit the APQC resources below.

To learn more predictions for HCM in 2020, visit the Talent Trends Survey (Collection) on APQC’s website.

At the beginning of 2015, APQC sent its Talent Trends survey to HR professionals and people managers. The 85 respondents represented a variety of industries and organization sizes, and 70 percent were at the manager/director level or above in organizations with revenue of $1 - $5 billion. Survey participation was evenly split between HR and other professionals.

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