3 Main Reasons Why Performance Reviews Are Not Successful Tools

Considering Banning Annual Reviews

Unhappy employee receives feedback during a performance review.
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I'm not a fan of the annual performance review. They don't accomplish the goals that they were designed to achieve. They don't open up a dialog between employees and their manager. They don't adequately supply employees with the information they need to continue to grow and develop.

Performance reviews are not an adequate reflection of the employee's work. They focus on only part of the year when they are scheduled annually.

They rarely focus on achievements related to measurable goals that are significant factors in an employee's job expectations.

They most frequently relay one person's opinion to another - often about areas that deeply concern neither participant - because they were the easiest performance areas to track and evaluate. For example, John returns twenty customer support phone calls a day. That's double what his coworkers accomplish.

So, you'd think John should get a good performance review? Right? No, wrong. You measured the wrong factor. You want to discuss with John the quality of his responses to customers and the quality of his interaction with them - not the number.

But, this is harder to accomplish, so many managers go with what they can easily measure. And, John is deprived of the opportunity to grow his skills.

You can change these negative factors about performance reviews and make your performance reviews a successful communication tool.

3 Main Reasons Performance Review Are Not Successful Tools 

These are three important reasons why performance reviews are not an adequate reflection of an employee's work over the year.

  • Especially annual performance reviews tend to focus on the most recent performance and ignore the contributions an employee makes all year long. Managers have short memories when reviewing employee performance.

    This is often referred to as the horns or halo effect as managers classify an employee's performance for the year by the employee's most recent success - or lack of success. Many managers write insufficient documentation over the course of a year. So, they have no reference points for successes and failures or examples to use when it's time to share them with employees.

    To have any shot at all at a favorable performance review, the manager must document, and the reviews should occur quarterly, at a minimum. For real, useful performance feedback, the daily interaction between the employee and the manager is the best opportunity for effective feedback.
  • Most organizations have spent insufficient time establishing goals for employee performance. Measurements, so that an accurate assessment of employee performance is available, are frequently non-existent. Or, the wrong inputs are measured as in my example above.

    Consequently, much that passes for performance evaluation in performance reviews is just one person’s opinions about an employee's performance. Performance reviews are not objective or measured.

    Even when they set goals, the manager and the employee rarely share a picture of what success will look like when the employee achieves the goals.
  • Managers rarely seek feedback from other managers and coworkers about an employee’s performance. These employees have a much closer view and opportunity to observe the impact of the employee’s work than the manager does.

    360 feedback can be scary for employees, especially when you first introduce it into the performance review meeting. But, its collection results in more objective, fair information about an employee's performance. 360 feedback helps the manager and the employee zero in quickly on the areas of performance most in need of development.

Annual performance reviews are not recommended.

These reasons highlight three of the main critical flaws in traditional performance reviews. Take a look at additional information about why performance appraisals don't work.

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