Is the Performance Review dead?

The Harvard Business Review recently reported that only 3% of those surveyed were happy with their current Performance Management. Deloitte found that more than half of the Executives they surveyed believed that current Performance Management approaches didn’t drive engagement, and didn’t lead to higher performance. What a mess we have created!

Recently I was privileged to chair an IECL “Q&A Insights Event” in Sydney where we explored this very topic. Here is some of the wisdom gleaned from our panel of experts drawn from a wide range of industries representing Banking, Retail, Utilities and Construction.

• Performance reviews/performance appraisals/performance management, call it what you will, first got rolling in the 1960s with a fundamental purpose of driving business outcomes through reward and punishment. Simply put, to get people to do what you want them to do! It had little if anything to do with employee development

• Luckily times have moved on from “the bad old days” with organisations today rapidly evolving their performance processes: to attract and retain great people; to focus on individual and organisational growth; to have more frequent and more valuable conversations.

• For managers conducting these performance conversations the bar has been significantly and rapidly raised. More than ever before managers” capability to have timely and meaningful conversations with employees is being called into question.

• McKinsey recently reported on the use of app technology to crowd-source real time feedback. Hang on, let’s take a collective deep breath. Is technology evil or enabler in this context? Such technology might be valuable for data analytics but that’s of no benefit without the rich conversation that can draw out the real insights. Too frequently conversations are being clouded by more and more data without gaining real meaning or insight into the person. So really, technology is only helpful if it facilitates a great conversation.

• Our panel got quite fired up when the emotive topic of performance ratings reared its ugly head! The dark side of ratings being the promotion of competitive behaviour and hiding the real conversation that needs to be had behind a number. In the brave new world currently being forged it appears that more than just a few organisations are severing the age old link between evaluation and compensation via a rating … let’s all sing hallelujah!

• And their final words of wisdom? Shift the focus to strengths, look back, look forward and look up at the big picture, and if leaders aren’t interested in leading people they”re in the wrong role! So, it’s not Lazarus with a triple by-pass and maybe it isn’t really the evolution of performance management either. I believe what is underway in many organisations right now is a seismic shift in their cultures. But I”m not yet convinced they are approaching it in this way.

Des Doyle – Master Facilitator and Executive Coach at IECL