I’ve written about annual performance reviews being broken, but I haven’t necessarily advocated trashing them all together. Kris Dunn, the HR Capitalist, put a call out for solutions, pointing out that if managers can’t give good feedback, then it doesn’t matter how you deliver that feedback – by annual performance review or other means.
Agreed. But the status quo is not the solution in the face of statistics like these:
- 70% of employees who were aware that their manager was unhappy with their performance couldn’t tell you what they were doing wrong or how they were going to change. (from Change Anything)
- Only 17% of organizations know all of its top-performing employees and are looking to develop them for future roles. (This and following from SuccessFactors/Accenture)
- Two-thirds of organizations have a pay-for-performance policy, but of those, only one in five always ensures that rewards are accurately aligned to contribution.
- 18% say they are very good at converting corporate strategy into priorities and goals. Just 15% are very good at aligning employee activities to corporate strategy.
So what should be done? To accompany the annual review process, create a new method for ongoing feedback and recognition – two very different things that are also the two lowest rated items in the Gallup Q12 for employee engagement.
You have three options for incorporating ongoing feedback and recognition in a management culture resistant to it:
1) Train managers to help them give better feedback and recognition in a timely way.
2) Make giving this feedback and recognition part of manager KPIs and MBOs to ensure they are done.
3) Exit managers who do not comply with this.
Ideally, some combination of options 1 and 2 are enough. But if managers are unwilling to give the feedback and recognition proven to increase employee engagement, then perhaps those managers are better suited to a role as an individual contributor.
This is critical. As Gallup points out:
“Given the low ratings worldwide for feedback and recognition, organizations that implement — or countries that encourage — effective feedback and recognition systems could gain a competitive advantage.”
Can you afford to ignore such a simple solution that will yield a competitive advantage in this economy?
About Derek Irvine
The VP of Client Strategy and Consulting at Globoforce, Derek Irvine is one of the world’s foremost experts on employee recognition and engagement, helping business leaders set a higher vision and ambition for their organizations. As a renowned speaker and co-author of "The Power of Thanks" and "Winning with a Culture of Recognition," he teaches companies how to use recognition to proactively manage company culture. Derek holds a B.Comm and Masters of Business Studies from the Smurfit Graduate Business School at University College Dublin.