Death of the yearly appraisal?

September 3, 2015 Geoffroy De Lestrange

Accenture has recently announced that it will be dropping yearly appraisals in favour for continuous performance management.

The company joins the several other large firms who have overhauled employee review systems in recent years. Accenture CEO Pierre Nanterme told The Washington Post that he plans to free all 330,000 of his staff from the annual job appraisal. Instead, the firm plans to implement “a more fluid system, in which employees receive timely feedback from their managers on an ongoing basis following assignments.”

This is a smart move from Accenture, especially as we know that:

  • Yearly reviews don’t motivate the majority; Globoforce found that 53% of employees say reviews don’t motivate them to work harder
  • 43% of highly engaged employees receive feedback at least once a week, according to Tower Watson
  • And Gallup release a report which stated that employees who receive strength-based feedback were 12.5% more productive

It’s clear that just the way yearly appraisals are conducted don’t currently work.  So, how do you make continuous performance reviews work?

Reviewing employees performance on a regular basis depends on a company’s culture, therefore can be weekly or at the end of assignments, for example. Regardless of when it happens, companies need to aid line managers in facilitating continuous feedback. Three ways to do this include:

  1. Encouraging real-time observations on performance – easily made via mobile devices, keeping it simple to not impact line managers’ time
  2. Peer reviews –which could be gamified and badges could be given to recognise regular good work
  3. Skills recognition – in the style of LinkedIn’s endorsements, as well as encouraging skilled employees to teach others  

A word of caution, however. It’s still important to give employees dedicated time to evaluate their career. So, detaching the performance review from the yearly appraisal is a good idea, but keeping a structure and carving out time to evaluate career progression is important. 

In addition, employees also expect regular talks regarding their compensation. This is certainly related to performance reviews, but the discussion is different and can justify a separate conversation, which needs to be organised on a regular basis.

About the Author

Geoffroy De Lestrange

Product Marketing & Communication Director EMEA at Cornerstone OnDemand

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