Most managers in Australia would like to ditch the annual performance review, according to a survey by recruiters Hays.
Two-thirds (67%) of 1,352 surveyed would replace the annual look at performance with more regular feedback and conversations between an employee and their manager.
Monthly meetings could be supplemented with a more formal quarterly KPI discussion and an annual salary review and career planning session.
The results of the survey reflect a global trend to replace annual reviews in favour of more regular feedback.
According to the latest research, the performance review, which in many companies is more a tick-the-box exercise than a critical assessment, has lost its effectiveness as a tool to gather information about talent.
What usually happens is that supervisors are concerned about demotivating staff by providing appraisal ratings that are accurate, yet low. So they tend to give high ratings, regardless of performance.
Deloitte Australia is running a global program to get rid of the feared meetings in favour of ongoing feedback and coaching.
The Hays survey found only 33% prefer the annual review.
“Most respondents agreed that some form of annual feedback is still important in order to celebrate the year’s successes, but that other more regular feedback must be provided too so that areas for improvement are addressed as they arise,” says Nick Deligiannis, managing director of Hays in Australia and New Zealand.
“This allows an employee and employer to change behaviour before it becomes embedded. Performance and productivity improve because feedback isn’t held off for the annual review, and managers spend less time managing issues that could have been avoided.”
One survey respondent said: “If someone told me I’d performed one thing wrong eight months ago, it (the feedback) wouldn’t be effective and would actually discourage me because it took so long to feed that back.”
Another said: “We’ve abandoned annual reviews as feedback should be ongoing throughout the year. We’re not abandoning the focus on performance, just how it is managed and discussed with employees. By making it more timely and ongoing we see performance improvements throughout the year.”
However, ditching a formal feedback process altogether isn’t an option.
Most employers say an absence of feedback would mean a decline in employee performance, their feelings of ownership and accountability would fall and they’d be given the impression no one cares.
One manager said: “Work performance evaluation is critical for managers to feel connected with staff and ensure both their physical and emotional needs are being considered. For staff it is imperative that they feel their supervisor listens to them and takes their feedback on board.
“Staff need to feel they are being heard at all levels.”