The APQC Blog

Performance Reviews: How to Tell If It's Time to Break with Tradition

In my last blog, I wrote about the pros and cons of the annual performance evaluation and asked for your personal opinion on whether performance evaluations should stay or go. If you haven’t had a chance to vote in our poll, click on the image below to tell us what you think.

But, what if you are a leader trying to decide for your organization whether to keep or get rid of performance reviews? Beyond looking at the results of this and other polls, and asking your employees their opinions, how do decide for your organization if it’s time to retire the time-honored tradition of the annual performance review and move on to a new approach?

To determine which side your organization should take in the great performance review debate, you’ll need to ask and answer a number of questions.

  • Are jobs at your organization complex, involving a wide range of skills and responsibilities?
  • Do you employ a lot of knowledge workers?
  • Do managers at your organization have a large number of direct reports?
  • Are employees empowered to make decisions and self-manage?
  • Is there a lot of uncertainty in your industry?
  • Is the pace of change in your industry increasing?
  • Is there a real or perceived threat of layoffs at your organization?
  • Do you need the ability to modify staffing levels and types of staffing arrangements?
  • Is there pressure to contain human capital budgets and spending?
  • Is your organization able to collect and analyze real-time workforce data?
  • Is your organization updating its HR technologies? 
  • Are your employees heavy users of social and mobile technologies?

The more “yes” responses you give, the more likely that it’s time for your performance review process to evolve with the times. In other words, if your organization is strongly affected by changing trends in business and work, there’s a better chance that your answer to the great debate will be to get rid of or evolve your current performance review process.

Each organization must settle this debate for itself.

If you are leaning towards evolving your organization’s approach, start by assessing if and where your current process is broken, and determining the benefits you hope to achieve. As you devise a plan for change, consider which tactics will fit best with your business culture and drivers of organizational success.

And, if you have decided that performance evaluations will stay at your organization, check out my advice for managers in this December 2016 Fast Company article:

Five Annual-Review Mistakes You’re Probably Making

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