For all their challenges, performance reviews play a vital role in performance management. They create the data points your entire strategy is built around. So why do so many managers and employees feel like they’re not getting much out of them?
Because the performance reviews aren’t the real issue. It’s that, too often, they’re just a flash in the pan. They give you insights that lead nowhere. Development plans aren’t followed, improvement processes vary widely depending on the manager running them, and success planning happens separately—if at all.
Effective performance management relies on performance reviews, but performance reviews alone don’t guarantee follow-through.
Here’s what does.
Key Takeaways:
No matter how complex your performance management system gets, performance reviews still serve an essential purpose: formalizing some of the most crucial parts of your performance management strategy.
Performance reviews allow managers to identify the gaps between an employee’s performance and the company’s expectations, surface employee strengths, and match development opportunities to broader career goals. If the goal of the performance review is to align managers, employees, and leaders on performance issues, objectives, and opportunities, then it usually meets that goal.
But alignment is rarely enough. Organizations run performance reviews once a year, give employees a few follow-up steps, and then nothing really happens. The insights from each performance review essentially disappear until the next performance review, and even then, they’re only used as a baseline. They don’t lead to action.
So why is it like this?
The performance review has three enemies: lack of follow-through, inconsistency, and disconnection from broader processes.
Too often, a development plan is handed off to an employee with little to no follow-up. It should be no surprise, then, that performance reviews rarely lead to lasting change.
Employees already have enough on their plates without taking on the entire responsibility for their development plan, which means progress rarely happens. A plan is crucial, but there’s not much point in making it if it’s not followed.
Too many managers treat performance reviews as the single touchpoint for performance management, usually because of insufficient support.
For performance reviews to contribute to an actual upward trajectory for employees, managers need to adopt a coaching mindset; every 1-on-1, check-in, and meeting should be an opportunity to help employees build up their skills. But they can’t do this alone and are too often forced to.
Succession planning is essential for building a pipeline of potential leaders, preventing many of the costs associated with a key leader leaving (e.g., loss of institutional knowledge, productivity loss).
Performance reviews should be one tool in a larger toolbox, allowing you to identify potential leaders and help them build the skills and seniority they need to replace current leaders. But succession planning typically happens independently of these reviews, disconnecting it from valuable data points.
What does your performance review process look like, in practice? Do managers pull questions and templates from a shared performance management system that also turns that data into actionable insights? Or do they rely on templates from word processors and whatever manual tracking they can come up with?
Few organizations have a centralized system for running performance reviews, which leaves follow-through up to individual managers. At first glance, this might seem more flexible, as managers can tailor their approach to their individual team.
But that’s rarely what happens in practice.
The employee experience becomes inconsistent—if not completely arbitrary—since individual managers each develop their own tracking and follow-through system for performance reviews. HR has no visibility on performance trends, since performance data is kept in multiple disconnected systems.
They don’t know who needs help or how to help them. Every performance decision becomes high-risk, since no one involved has a realistic view of what performance even looks like throughout the organization.
There’s no doubt that performance reviews work. Managers get key feedback on what to improve and employees on how to keep growing. But if there’s no standardization or no real follow-through, then each performance review ends up being little more than just another meeting.
Get more value out of each performance review with a structured process for follow-ups and follow-through. Here’s how it’s done.
By default, performance reviews are a one-time check-in for development, but they should be a launching-off point for a process that continues throughout the year. The first step? Setting better goals. Goal-setting methodologies like OKRs and SMART goals give employees clear targets for the year and measurable metrics for tracking progress.
Combined with a continuous feedback culture, which encourages managers and employees alike to use every opportunity to offer constructive feedback, everyone can have a clear view of progress towards these goals.
Consistency is essential to making your performance reviews more effective. That means standardizing expectations and timelines across teams. A dedicated performance management system like 15Five is the best way to do this, since it can standardize everything from the initial performance review to follow-up meetings. But even if you stick with other systems, standardization is key.
Build processes that formalize what happens after performance reviews, including check-in frequency, platforms used for goal-tracking, and formal links between performance reviews and succession planning (e.g., alignment meetings between leadership and managers).
Talent planning ensures your organization has the talent it needs to support its strategy. That involves everything from succession planning to identifying and closing skill gaps. Performance reviews generate essential data for talent planning by identifying potential leaders, highlighting skills your organization needs, and tracking the growth of your talent pool.
But that requires follow-through (i.e., pushing performance review results to systems used in talent planning). When that’s achieved, your talent planning efforts rely on true visibility rather than gut instincts and broader market trends.
Follow-through on performance reviews may start with a top-down strategy, but managers are that strategy’s frontline; it succeeds or fails according to their dedication and involvement. Every manager wants to see their team succeed, but when employee performance is just one of many responsibilities, follow-through becomes more difficult.
HR teams shouldn’t just consider themselves employee performance strategists. They’re the support system that helps managers turn strategy into action.
Managers, like the people on their teams, have to cycle through dozens of tools to get their day-to-day work done. If performance improvement plans live in a Word document hidden on a desktop somewhere, they’re likely never going to be relevant again. Dedicated performance management systems can tie performance development to day-to-day work, especially when they centralize tasks for other management responsibilities.
You don’t necessarily need these systems to ensure your performance reviews have follow-through, but you do need to meet managers where they’re at. That means helping them use the systems they have access to for standardizing this work instead of relying on forms and memory.
Most employees want more feedback from their managers, not less. Support them in giving it. Yearly performance reviews should be one of many touchpoints, with ongoing performance conversations happening in 1-on-1s, check-ins, and other meetings.
Even pulse surveys and employee engagement surveys can serve as jumping-off points for performance conversations. Give managers the tools to approach performance in a variety of settings, which can help take some of the stress off the annual performance review.
When you have a system for connecting performance review conversations with a manager’s day-to-day work, you give managers real-time visibility on employee performance. That allows them to give better guidance as employees work towards their goals, surface issues before they become broader problems, and engage in ongoing development with employees rather than checking in once a quarter (or, worse, once a year).
In many organizations, performance management begins and ends with the performance review. You build a template, managers use it in a yearly meeting, and employees use the takeaways to try and do better before their next review.
But not only does this approach put an enormous amount of pressure on each performance review, but it also obscures a ton of opportunities. Performance reviews work best when they’re part of a broader, interconnected performance management system. Here’s why.
A performance management system can either be a dedicated tool or a collection of processes that align leaders, HR, and managers on improving the skills, performance, and opportunities for the company’s talent pool.
It goes beyond the typical yearly review cycle by injecting performance objectives into day-to-day work. Performance reviews, 1-on-1s, and other meetings become data points for a broader system to help everyone identify and reach their full potential.
Performance management systems typically involve:
No matter how you build and manage your performance management system, it should:
Performance reviews are still one of the best tools for getting a summary of an employee’s performance throughout the year, but they fail when they’re the only conversation employees get about their performance.
Structured follow-through, using growth plans and smart goal-setting, ensures employees and managers alike make the most of every performance review. By making these reviews part of a holistic performance management system, you’ll get better execution from managers, better visibility for HR, and clearer growth paths for employees.