For as long as there has been human resources, there's also been the annual review. A hallmark of performance assessment, annual reviews used to be the only method companies had to judge their workforce – but times have certainly changed.
Now, continuous performance management (CPM) is getting more buy-in, all the way from industry leaders at the top to startups just making their way in the modern business landscape. Most organizations stuck to annual reviews for a number of reasons: habit, ease, lack of options. But as the demographics of the workforce change (hello, millennials and Generation Z) and business itself is transformed by the advances in technology, so too has performance management undergone fundamental shifts.
However, considering the longevity and essentiality of the annual review to many businesses, switching to CPM isn't always as easy as 1-2-3. There are a number of different needs companies must address when they set out to implement CPM – among them staff communication and technology to support the effort. Taking the time to strategize how best to bring CPM to your businesses will help set up the endeavor to succeed, as well as deliver the type of productivity and engagement results organizations seek when adapting their performance management policies and processes to the modern world.
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Find a role for the annual review
Pulling a 180 on performance management is a difficult prospect for any company, which is why it helps to ease into CPM, or meld it with existing methods. Though the annual review has certainly lost its luster, it still has a meaningful role to play in an overall CPM strategy.
Continuous project management is, after all, continuous: from the beginning of the year to the end of it. The key CPM concept here regarding the annual review is eliminating its position as the sole means of assessment. When companies conduct an annual review and nothing else, they open themselves up to the risks of an year-end assessment skewing the real productivity of an employee over the year, and leaves staff hungry for more engagement and feedback. Saving everything up for the end is not an ideal, or practical, way to use the annual review.
Instead, companies making the shift should incorporate the annual review into a greater CPM schedule of check-ins, feedback and progress tracking. The annual review still has value as a year-end cap in which managers and employees can discuss how the year went, what goals were met and what to look forward to in the next 12 months. Saving up all the feedback for one day in December, however, isn't a viable option; the annual review should be just one tool in the entire CPM kit organizations leverage.
Talk to staff about the change
CPM is all about engaging the workforce, so it stands to reason that whenever a company decides to augment its assessment policies that one of the first steps to be taken is informing staff and all other stakeholders. While employees may dread annual reviews and want something else in terms of feedback regularity, getting rid of (or repurposing) the annual review can still come as a shock.
Organizations should take every measure they can to ensure any shift toward CPM is clearly communicated across the office. Leaders should also make themselves available for questions and comments: Involving staff in the decision-making process can help businesses fine-tune their CPM strategies.
Don't forget technology
Annual reviews don't demand a ton of tech as a one-off event. But continuous performance management requires a comprehensive solution that managers can use for anything: from tracking progress to refining workflows and getting insights from real-time data. The more robust a software solution an organization has, the better equipped it becomes to successfully carry out CPM. Having oversight and transparency (that can be granted to employees, to a degree) can enhance feedback and performance management.
If interested in what this type of software looks like, and the features and capabilities it boasts, contact BetterWorks today to learn more and get a demo.