SECTION ONE

Rethink Traditional Annual Performance Reviews

THE DEBATE STILL RAGES: does the annual performance review offer real value, or does it alienate employees from their managers? The answer is, of course, it all depends. Survey results indicate that the once-a-year review, when used as the only performance measurement tool, fails miserably to make lasting performance improvements. But when it is part of an overall performance improvement program, it can be very effective.

The proper framework for all performance reviews is that the employee and manager first focus on the big-picture objectives: (1) increasing customer benefits and satisfaction; (2) adding value to the organization; and (3) contributing to the efforts of the team or coworkers.

For any performance system to work at its best, the relationship between manager and employee needs to be one of mutual respect, support, and collaboration. Rather than being a disciplinarian, the manager needs to be a performance coach. Then, of course, there’s the issue of timing. The function of performance coach works best when done on an ongoing basis—daily, once a week, biweekly, or once a month. This approach means that whenever the more formal performance reviews are scheduled, the employee will not be surprised by how his performance is rated.

The most productive manager/employee relationships are based on a dialogue, not a monologue. That means that the employee feels comfortable enough to initiate communication with his manager and to contribute to and offer his own input on his performance. Doing this on an ongoing basis offers the best possibility for performance improvement.

The successful manager will regularly