Almost everyone agrees annual performance appraisals are an ineffective means of accelerating performance. However, most organizations have an annual performance appraisal process and refuse to consider alternatives; another one of those “we’ve always done it this way” talent processes. One of the first documented performance appraisal processes was from the 3rd century Chinese Wei dynasty. They used a nine rank system by which officers were categorized based on their abilities. The eighteen hundred year old formant looks remarkably like many performance appraisal forms we see today.
In addition to the traditional reasons for abandoning annual performance appraisals (waste of time, ineffective, inflated scores), there are several recently developed arguments:
- neuroscience advances have shown annual performance appraisals actually cause diminished brain functioning
- the new generation of workers expect immediate feedback
- widespread team and matrix leadership methods are a poor fit for the annual performance appraisal process
Fortunately, companies are moving away from annual performance appraisals. From 2011 to 2012, the number of HR managers reporting abandoning annual performance appraisals tripled. Many of those organizations are moving to informal quarterly performance reviews using a single summary sheet focused on a handful of forward-looking goals, past achievements, and has no numbers or ratings.
Empower your leaders to abandon annual performance appraisals in favor of quarterly performance reviews and you’ll have more successful talent acceleration.
The Metiss Group's Blog 