Employment expert Rob Wilson explains what companies should do instead
A recent survey found that two-thirds of organizations feel that their performance reviews are not effective. Described as ‘subjective and highly ambiguous,’ performance reviews can be a very impactful tool when used appropriately, but as this research shows, most companies say that they are falling short of the mark.
Employment trends expert Rob Wilson, says, “Although some employers are eliminating the annual performance review, we don’t see that as a good solution for the vast majority of companies. Without an annual review (even if it’s just a compilation of more frequent ones), it’s very difficult for employers to work on merit pay increases.”
Wilson, who is the President of the national employment solutions firm Employco USA, says that instead of ditching performance reviews entirely, companies need to rethink the way they approach this measuring stick and bring performance reviews into the modern era.
“Modern performance reviews are largely based on the merit system used by the military in World War I – a system that has not grown adequately to suit the needs of today’s corporate structures. The original idea was that workers were so plentiful that poor performers needed to be identified from efficient workers so the former could be replaced and the latter promoted. This mentality is slowly dying as the labor market tightens up. Employers are now more concerned with coaching poor performers instead of replacing them immediately. Annual reviews are less effective in this regard, since their primary purpose is to hold employees up to a (typically) quantitative standard, not to assess granular performance and insert coaching opportunities. That’s where frequent check-ins come in,” says Wilson.
What is a frequent check-in? Think of frequent check-ins as microscopic evaluations. In this process, managers evaluate employee performance periodically throughout the year, not just at its end. Managers are checking in on employee performance as it happens, not giving a rating months later.