14172180_sWhether it’s called the annual performance appraisal, a quarterly conversation, check-in, dashboard meeting, GPS session, or some other euphemism, getting the performance evaluation right is important. Too many expectations during performance appraisals take away from focus on goals and results. Not enough, and you risk losing clear communication. The ideal evaluation should be a collaborative process for managers and employees. To avoid a tedious, meaningless exercise in grading someone’s performance and make sure appraisals work to support employee retention in a high performance culture, you need to think differently about the performance appraisal.


Performance Appraisals and the Millennials

Tradition once-per-year performance appraisals aren’t effective or motivating for the younger generation who are used to more feedback, more choice, and more variety in everything and expect it at work. A four-part form with check boxes and small spaces for input just aren’t ideal for the kind of ongoing feedback loop that Millennials want and are used to.

No one knows this better than General Electric, where former CEO Jack Welch built a system formerly known as the “vitality curve” or “rank and yank” for its ruthless culling of the lowest under-performers. The high profile company, along with others like Microsoft, Adobe, and Accenture, no longer does formal annual reviews and has implemented a less structured feedback system. It’s more suited to the company today and its younger employees. GE executives explain that not a lot of the world is on an annual cycle anymore, and that prompted the change, along with the way millennials are used to working and getting feedback.


Forms Are Too Slow

The pace of business today requires a performance appraisal that keeps up. Experts like Daniel Pink advise employers to avoid a workforce feedback desert with ongoing conversations, not annual papers. A weekly meetup or a quarterly check-in enable managers and employees alike to catch-up more often and have more meaningful dialogue about the actual work. Filling out a form with 50 questions leaves too much up in the air for too long, taking the chance that specific performance and projects will be overlooked or not credited where credit is due. A performance process that takes place more often than once a year is an opportunity to give and get real time feedback, in turn giving the company more opportunity for open, honest conversation about the work that takes place within its walls.


They Don’t Have to Be Crap

David Hassell, founder of SaaS company 15Five, says the annual performance appraisal process is an outdated way to collect the information needed to evaluate employee performance. He actually refers to them as crap, explaining that today’s workers aren’t in the same seats for 30 years like previous generations. So Gen X and Gen Y just aren’t as strongly motivated by compensation and promotion as by purpose. Timely and ongoing feedback makes Millennials more comfortable as well as provides valuable information that can be acted on in time to make changes and corrections before issues get out of control.


Performance Appraisals Don’t Improve Performance

Employee and manager dread of the performance appraisal process may be well justified. Researchers at Kansas State University, Eastern Kentucky University, and Texas A&M University found that performance reviews don’t actually improve performance. They actually serve to significantly demotivate the best employees and lead to internal competition. Josh Bersin, of Bersin by Deloitte, recommends focusing on collaboration, professional development, coaching, and empowering people rather than providing a static process with “constructive criticism” that just doesn’t work anymore.


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