It is around this time of year that organisations start to turn their minds to June and all that means for the end of Financial Year. Budgets are finalised, targets assessed, and generally the dreaded annual performance review is dragged out and managers are reminded over and over again that they need to have a review with all of their team members, send the score to HR, have the scores “calibrated”, and then in a few months time get a form letter telling their staff member that because of all their fantastic contributions they get a 2.3% pay rise this year. Woohoo!

Why do so many companies continue with this process which is highly administrative (even with online solutions), time consuming and, in many cases, demotivating? Unfortunately, the reality is that without a formal process in place, many Managers won’t give employees feedback, and they may not think to talk to them about development, or set goals. The other driving force is that many management teams feel that performance reviews are required to justify pay increases. The idea of moving away from reviews and scores leads to thought bubbles of teams of under-performing staff and no accountability.

When a Leader’s role changes from an evaluative Judge to a Coach.

But we know that more and more organisations are moving away from traditional performance reviews – so how do they do it? For some, they rely on technology to enable teams to provide continuous feedback. Others simply have an allocated time four months a year where managers and their employees need to have a guided conversation. The biggest change when moving from a traditional performance review process, to one of meaningful discussions between employees and their managers, is that the Leader’s role changes from an evaluative Judge to a Coach.

If you know your performance review process isn’t working, but you’re not sure how to move to a more collaborative, conversational approach, remember that each organisation is different and you need to determine what works best for yours. Here are 5 steps to get started:

1. Determine the Why

It sounds easy, but this is your critical step. The first thing is to determine why your current process isn’t working.

  • employee feedback?
  • evidence that reviews aren’t being completed?
  • evidence that training and development is not happening?
  • engagement survey results?

Then ask:

  • Why are you wanting to change?
  • Why do you want any kind of structured review process?

Some of you may think that isn’t a problem to just remove the performance review process all together… but for most of us… working every.single.day without knowing if we are performing well? Not getting any positive feedback? Not knowing how to ask for more challenging work, or even how to get that next promotion? Being unsure of where/how to develop yourself?

Determining your why will enable you to focus on what your new process looks like. Before going to far, you need to take your own thinking and talk to the business.

2. Consult

With Managers and employees. Ask them what they find works, or doesn’t work about the current process. Be honest about why you think it isn’t working. Ask them what it is that they want? I can almost guarantee you it will be along the lines of:

  • open conversations
  • two way feedback
  • to know I’m doing a good job
  • recognition
  • development
  • frequency of at least quarterly

3. Refine

Take all this information and refine it. You’ll probably find that this new process will include structured conversations rather than completing forms. Discussions that are future focused rather than scores that rate past performance. Leaders needing to listen and coach rather than evaluate and judge.

If you currently tie pay rises to performance reviews you may also need to determine your new remuneration strategy.

4. Pilot

This is a big change and for some the shift will create anxiety. It is also an all-company change so a small pilot will help you iron out any kinks before going into full launch mode. It is best to pick a few small teams in different areas of the business and ask them to try the process and report back before you launch. Their (hopefully positive) feedback will also be helpful to “sell” through to the rest of the business.

5. Train

Managers and employees will need help to adjust. Online videos, written instructions and face-face workshops can all be used to explain the differences between the traditional process and your new one. You should also incorporate focused training for leaders on coaching and communication techniques to help them adjust.

6. Evaluate

Continuous evaluation of your new process is key to keeping it useful and valued. What works today may not work in two years time. These performance discussions are one of the keys to employee engagement so it is worth the time and effort to continually review and improve.

Final Note

Not all performance review / quarterly discussion processes are the same ; nor should they be. Each organisation is different so although it is helpful to review what other organisations do, that may not be the best solution for you. Talking to your teams and designing a process around the business needs and their ideas will give you the best outcome.

If this all sounds great, but you don’t have the time or resources to begin, just contact us for a confidential discussion, we’d be happy to help!

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