Having been on both ends of performance reviews, I admit I’m not a huge fan of them to date or at least, not of “one-off” annual performance reviews. However, executed well, with a long-term vision for all parties, I think they can be a really useful tool for growth and development, but as always, it depends on the driver behind them and the culture of the organisation delivering them!

In my experience, performance reviews have fallen into something that it’s more of a tick-box exercise for the organisation and more often than not, they are too corporate-oriented. Even the phrase “performance review”  has for me, and I’m sure for other people, a negative connotation, which can create a cultural hangover within organisations and teams around the use of them. 

Is there a better way for performance reviews?

That said, I think there is a better way to carry out performance reviews and as Simon Sinek would say, it starts with WHY. Why do we do performance reviews and what are we trying to achieve? 

For me, performance reviews should be aligned with Individual Development Plans within organisations. They should be colleague-oriented. 

A great example would be sports where the performance reviews focus on individual development and the daily, weekly, and monthly, “process” of getting better, rather than the outcome of competition (winning/losing a game) and there is a lot that corporate organisations could learn from it. 

How can we make performance reviews more effective?

Start with company culture

Many of the challenges of performance reviews could be solved with a positive company culture. A culture that puts people at the centre of the organisation. 

Do we really understand what the person on the receiving end of the performance review wants or needs out of it? Do we know what the best way would be for them to do it? Even more important, are we falling into the trap of creating a process that only serves certain people? 

As a senior leader, I have experienced first-hand how ineffective processes are when they aren’t designed with you in mind. So, for me, it’s critical to reinvent performance reviews in a more inclusive and diverse way. Create processes with diversity in mind and for that, you need to include everyone in the creation process. 

Keep your company values in mind

When we talk about culture, we can’t forget about company values. What are the values that we want to live by and how are we living them day in and day out? 

I’ve seen many performance reviews where values were nowhere to be found. Keeping your company values in mind would ensure that the demonstration of these values is assessed in performance reviews, considering we’re looking at them as part of IDPs. 

Making them the norm, not the exception

Assuming that we can cover a person’s performance for the last 12 months in an hour session is unrealistic and it creates more problems than it solves. 

However, they can be a time for reflection and celebration (what has gone well, where can we keep growing).

The fundamental part in my opinion is to make performance reviews an ongoing organic process across the year. Create an environment where people feel safe to speak up, receive and give feedback and have challenging conversations more often, instead of holding up until the end of the year, where more often than not, it’s already too late. 

This is also linked to values, if you see someone whose behaviours don’t align with the company values, waiting till the end of the year is not doing that person or the organisation any favours. Creating an environment where you can give feedback on these things when they happen, allows the person to reflect and think back and hopefully, act differently in the future. 

Develop leadership skills

There are probably only a small number of people who were born great leaders. But this doesn’t mean we cannot learn to become one. Providing training that helps people develop their leadership skills is a crucial aspect of more effective performance reviews. 

Using a coaching leadership style for example can be a great way to make the most of performance reviews. Knowing what the right questions to ask are, being more empathetic, and improving your listening skills, are just some of the few things that great leaders should continuously work on. 

Use a holistic approach

Gathering authentic and objective feedback is always a challenge for executives and larger organisations. However, as leaders, we should always strive for the most real overview possible. 

To gain this understanding, I think it’s necessary to make performance reviews a 360 process where not only managers get to review their teams, but the teams get to review their managers too. 

Fortunately, there are many possibilities to do this, I have seen few options in the past that seem to work well. 

• The goldfish ball activity: where the whole team takes turns to sit in a chair in the centre of a circle and receive feedback (both positive and constructive) from every person in the team. 
• Gathering feedback from different avenues: as part of someone’s review, that person is tasked with gathering 5-10 feedbacks or reviews from different people they work with. This can even include clients or people in different teams that they have worked closely with. 

Using methods like these, allows leaders to gain a more realistic view of someone’s performance, and helps to avoid someone’s biases or opinions of the person being reviewed.

Create accountability for everyone

Performance reviews have a focus on accountability for the employee, but what about the organisation? 

Going back to my previous point about making them part of the individual development plan, we could use these reviews as an opportunity for every member of the team to communicate what they need from the organisation to continue their growth. 

For example, let’s say someone needs to improve their sales skills, how can the organisation contribute to it? Is it more training, or is it more help or support from a manager or a colleague? Whatever that is, the review process should be a two-way conversation where both the employee and the organisation are held accountable for the employee growth and therefore, the outcomes. 

Take action

I previously mentioned that performance reviews have been in my experience a tick-box exercise, and following up from the accountability point above, I think action is a must if we want to make performance reviews more effective within our organisations. 

Continuing with the previous example, what is the organisation doing after hearing what the employee needs? Taking action proves that you are a people-centred organisation and will impact your employees’ engagement and satisfaction, with in turn, will help retention. 

On the contrary, not taking action, will communicate to everyone in your organisation that what they say doesn’t matter, and disempower them to speak up in the future. And this is a really dangerous place to be. 

Be agile and adapt

Creating new processes is not easy, which is why being able to adapt is crucial to success. I believe there is a better way but I’m also aware of the challenges when creating something new. 

So, when thinking about how to change and make performance reviews more effective, we need to plan for reviewing the process and making changes until we get it right. And even then, times changes and we need to continuously adapt to new realities, so making sure we have an internal review process of the process is an important element towards success. 

File for divorce

It’s not uncommon to link performance reviews to promotions and pay rises, which first, re-directs the objective of the process and secondly, it creates a great deal of stress both for the team members and the leaders. 

But we can divorce the two. Having conversations about promotions and pay rises is essential, but we can find a more appropriate time for them. This will allow us to keep our reviews focused on individual development and growth. 

Be aware of feelings

Any situation or experience will generate an emotional response and it will be different for each of us. While it is impossible to prevent these emotional reactions, we can make sure we do our best to ensure they are positive ones. 

All my points above will hopefully make people see their performance reviews as something that is good for them, a way to grow and learn. In addition, another thing to consider is thinking beforehand about how are people feeling after the review. You want them to feel enthusiastic and engaged instead of drained and disengaged.

Download our guide to prepare for challenging conversations here. 

There is no one-size-fits-all to do this, but starting with the end in mind (what is it we want to achieve? How do we want people to feel?) is a good starting point. 

The Optimist View…

I think optimising performance reviews is possible, there is a better way, and there are many companies already trying to do better. For me, the fundamental part is to see a cultural shift in organisations where we put people at the centre and reinvent the wheel to create working environments that are inclusive of the real diversity of the world. 

This is a passion for me and one of the reasons I am passionate about my job at Optimist Performance. Our leadership programmes work with teams to develop their leadership skills to help them thrive in their organisations. Get in touch with us to learn more.