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How to Move from Annual Appraisals to Continuous Performance Management

Wooden blocks on a dark table with the words 'make it happen'

Lead­ing organ­i­sa­tions such as Gen­er­al Elec­tric, Accen­ture and Adobe have moved away from annu­al appraisals in favour of hav­ing reg­u­lar one-to-one dis­cus­sions (or check-ins’), review­ing and updat­ing objec­tives through­out the year and giv­ing fre­quent feed­back. This method­ol­o­gy is increas­ing­ly being referred to as con­tin­u­ous per­for­mance man­age­ment. Whilst a lot has been writ­ten about the organ­i­sa­tions who are adopt­ing a year-round approach to per­for­mance man­age­ment, lit­tle has been said about how to make it hap­pen. So we’ve pre­pared this 7-step guide on how to suc­cess­ful­ly imple­ment con­tin­u­ous per­for­mance man­age­ment in your organisation.

1. Start now, don’t wait for the cul­ture to change

It may be tempt­ing to wait until you have under­tak­en a cul­ture change pro­gramme before chang­ing your per­for­mance man­age­ment process­es. How­ev­er, with research show­ing that 95% of man­agers are dis­sat­is­fied with their organisation’s exist­ing per­for­mance man­age­ment sys­tem, why con­tin­ue doing some­thing that just isn’t work­ing? As Adobe com­ment­ed on their tran­si­tion to check-ins, this is a jour­ney and not a des­ti­na­tion”, so the soon­er you start tak­ing action, the fur­ther you will progress on that journey.

2. Find out who is already hav­ing reg­u­lar per­for­mance discussions

You might feel that imple­ment­ing con­tin­u­ous per­for­mance man­age­ment will require a sig­nif­i­cant cul­tur­al shift. After all, if it’s hard work­ing get­ting man­agers to have once-a-year per­for­mance reviews, how will you get them to have reg­u­lar per­for­mance con­ver­sa­tions? Organ­i­sa­tions who have intro­duced con­tin­u­ous per­for­mance man­age­ment actu­al­ly found that many of their man­agers were already hav­ing reg­u­lar per­for­mance chats on an infor­mal basis and mak­ing them work suc­cess­ful­ly. So find out who these peo­ple are with­in your organ­i­sa­tion, involve them in design­ing your new process­es and get them to cham­pi­on your cause.

3. Engage your senior leadership

To make con­tin­u­ous per­for­mance man­age­ment a suc­cess, you will need to get buy-in from top man­age­ment and have them to lead by exam­ple. Whilst most senior lead­ers dis­like doing annu­al appraisals, they may be ner­vous about the impli­ca­tions of stop­ping them, par­tic­u­lar­ly if you are plan­ning to get rid of rat­ings as well. They are like­ly to have ques­tions about how you will iden­ti­fy high and low per­form­ers and how pay and pro­mo­tion deci­sions will be han­dled. So make sure you sup­port your case for con­tin­u­ous per­for­mance man­age­ment with research-based evi­dence and have answers to these ques­tions read­i­ly avail­able. To help with this, we have cre­at­ed a short ani­mat­ed video out­lin­ing the busi­ness ben­e­fits of con­tin­u­ous per­for­mance man­age­ment.

Addi­tion­al­ly, here are some good qual­i­ty research reports and arti­cles that you can access for free:

4. Sell the benefits

If man­agers and their team mem­bers are going to active­ly engage in hav­ing reg­u­lar one-to-ones and giv­ing fre­quent feed­back, you’ll need to ensure that they under­stand what’s in it for me?”. For man­agers, the ben­e­fits include hav­ing a bet­ter per­form­ing, more pro­duc­tive and moti­vat­ed team, reduced staff turnover, abil­i­ty to del­e­gate more and spend­ing less time fix­ing mis­takes. Make it clear that it will ulti­mate­ly save them time.

Organ­i­sa­tions who have made con­tin­u­ous per­for­mance man­age­ment a suc­cess have put the onus on team mem­bers to ensure that their one-to-ones hap­pen, rather than on man­agers. There­fore you’ll need to sell the ben­e­fits to team mem­bers too. Empha­sise that they will have more own­er­ship over their work, they will get more time­ly feed­back and more one-to-one time and sup­port from their man­ag­er. But they will need to be proac­tive to get these benefits.

There is plen­ty of evi­dence in the above research papers that you can draw on when sell­ing the ben­e­fits to staff. How­ev­er, it’s even more pow­er­ful to draw on suc­cess­es from with­in your own organ­i­sa­tion. So where you have found teams that have already been hav­ing reg­u­lar one-to-ones and giv­ing feed­back on an infor­mal basis (see point 2 above), make sure you share these suc­cess sto­ries and com­mu­ni­cate the ben­e­fits that they have achieved.

5. Pro­vide train­ing and guidance

Good qual­i­ty per­for­mance con­ver­sa­tions and feed­back rely on the par­tic­i­pants hav­ing the nec­es­sary skills. So re-invest the time you cur­rent­ly spend admin­is­ter­ing annu­al appraisals on train­ing and coach­ing staff on how to have effec­tive one-to-ones, how to give and receive feed­back, how to set short­er term goals, and the fun­da­men­tals of coach­ing. Sup­port your train­ing with quick fact sheets, eLearn­ing and short videos — the more inter­est­ing and inter­ac­tive the bet­ter. Our own Clear Review per­for­mance man­age­ment soft­ware comes with inte­grat­ed ani­mat­ed white­board’ videos on the key skills required for con­tin­u­ous per­for­mance management.

6. Com­mu­ni­cate, communicate…and listen

It’s well recog­nised with­in change man­age­ment that you need to com­mu­ni­cate a mes­sage between 3 and 6 times before it is under­stood. So sup­port your jour­ney to con­tin­u­ous per­for­mance man­age­ment using a vari­ety of com­mu­ni­ca­tion meth­ods such as face-to-face brief­in­gs, videos, webi­na­rs, intranet pages, fact sheets, newslet­ters and road­shows. Don’t make the mis­take of rely­ing just on email. Com­mu­ni­ca­tion should not all be one-way how­ev­er. Make sure you reg­u­lar­ly seek feed­back from team mem­bers about how they are find­ing the new process­es, using sur­veys, inter­views and focus groups.

7. Use con­tin­u­ous per­for­mance man­age­ment software

Whilst the basis of con­tin­u­ous per­for­mance man­age­ment is reg­u­lar per­for­mance dis­cus­sions and feed­back, using ded­i­cat­ed con­tin­u­ous per­for­mance man­age­ment soft­ware will make the whole process con­sid­er­ably more effec­tive. It will:

  • Enable employ­ees to update their progress against their objec­tives in real-time, mak­ing one-to-one dis­cus­sions more focused
  • Pro­vide online agen­das for check-in meet­ings and enable action points to be cap­tured and fol­lowed up on
  • Give HR vis­i­bil­i­ty of how fre­quent­ly one-to-ones are tak­ing place across the organisation
  • Enable in-the-moment’ feed­back to be giv­en and shared with indi­vid­u­als immediately
  • Auto­mat­i­cal­ly chase up peo­ple who are not hav­ing reg­u­lar one-to-ones or giv­ing feedback
  • Allow you to cap­ture per­for­mance data or rat­ings from man­agers to feed into your reward and tal­ent man­age­ment decisions
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