From Zero to Hero: From Annual Reviews to Continuous Performance Management
Did you know that last August, the 315,000-employee enterprise most famous for ruthlessly firing their bottom 10 percent of staff after annual reviews jumped onboard the new ship of continuous performance management assessments? General Electric, commonly known as “GE,” is finally overhauling their staff-evaluation practices after 30 years of a strict “rank and yank” policy. Reading this, you’re probably thinking: “Was it really a good decision? If so, should my company consider it too?”
Many other top companies have already transformed their annual performance reviews, most notably Accenture, Deloitte and Adobe. If you’re wondering why, the most commonly cited reasons were that annual reviews:
- Cost a fortune to conduct.
- Can lead to many flawed results.
- Are an event dreaded by all involved parties.
- Don’t effectively drive employee performance as intended.
GE chose to do it by creating their own app: “PD@GE.” This mobile app lets employees give and receive feedback anytime. Currently, the formal annual-review system that took five months to complete is gradually shifting to much shorter and meaningful reviews with frequent feedback all year round, according to a report in The Wall Street Journal.
The impact was impressively positive.
As evidenced by their continued adaptations of the continuous performance management model, GE’s approach is improving the overall productivity of the whole business significantly just as it already has for others. Here are some of the results by companies that have adopted such a continuous approach:
- Their staff feels that management values them more in the workplace, shown in this case study by CEB.
- They reduced their voluntary turnovers, keeping great talent from leaving. In fact, Deloitte University Press reported that Adobe’s employee turnover rate fell by 30 percent after scrapping annual reviews for ongoing feedback.
- They saw a significant boost in productivity overall by removing the old annual reviews that took excessive amounts of time to prepare and execute.
These three key characteristics are what make this new process work:
1. Frequent feedback supports employees to achieve the organization’s goals.
The new approach is an ongoing process that becomes a natural part of the daily work of employees. The practice helps staff members do their jobs better instead of being an administrative burden. It engages, aligns and empowers employees to deliver on the organization’s top priorities with consistent, real-time feedback that’s timely, specific and actionable.
2. Modern technology enables instant feedback.
The use of applications make it easier and more convenient to exchange regular feedback that’s more valuable and meaningful. Employees always know where they stand, empowering them to improve throughout the year.
3. Regular feedback allows for frequent one-on-one discussions.
Based on this real-time feedback, it’s easy to facilitate frequent conversations between managers and employees. Managers no longer have to make an impossible attempt at remembering all of the employee’s actions over the year, and the feedback yields a much more accurate picture of performance. Furthermore, managers and employees have a constant pulse on performance and can make important changes immediately.
To learn more about how your company can apply the approach of continuous performance management in practice, feel free to contact us. We’re offering a cloud-based application that integrates directly into employee workflows, capturing the instantaneous, context-rich feedback between employees that naturally happens every day. Real-time feedback is far more relevant and actionable than comments typically delegated in an annual performance review because it empowers employees to improve as soon as they receive the feedback. By creating an intuitive, simple application that makes it frictionless for employees to interact, QuercusApp removes barriers in communication to cultivate a culture of continuous feedback for more engaged, high-performing employees.
