Two questions to ask before scrapping performance reviews

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With everyone from HR managers to employees becoming increasingly frustrated with how performance is handled, firms may be tempted to scrap traditional performance assessment methods.
 
Before taking this step however, it is important to ask two critical questions, Cindy Grass, head of talent & strategy at ANZ, told HRD.
 
  • How can we improve the business impact of our investments in people?
  • What value are we obtaining from our performance reviews?
 
If the answer to these questions is that the business is over-committing financial resources to performance management without actually creating any value, Grass says it is then time to assess the reasons behind this.
 
“Once you understand the why, you can decide if it’s the performance review that needs refreshing or if it’s your business strategy requiring refocus,” she said.
 
Grass points out that there are three main reasons behind why performance assessments fail:
 
  • They are too time consuming: Employees and managers are expected to spend copious amounts of time capturing and collecting information
  • They are too administrative: The system fails to capture useful data from employees which can be used for predictive analytics, talent management, etc
  • They are poorly conducted: Managers aren’t trained to have effective conversations with staff or employees aren’t being honest when assessed
 
HR should always carefully consider the ramifications before revamping performance management.
 
“Are we ready to wipe out all the lessons learnt from our performance reviews in the hope that by taking away the paperwork/admin, people will feel happier? What new issues will you face?” she asked.
 
Whatever changes HR makes, Grass says the end result should focus on understanding the key reasons why performance management has been unsuccessful. Any insights gained here should be used to make sound decisions which actually benefit managers and employees in the long-run.

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