Employee evaluations are intended, in theory, to both inform and invigorate workers; when successful, they can help drive productivity and retention.
At many organizations, however, it seems they aren’t providing valuable feedback or motivation. A recent Adobe poll found more than half of office workers (59 percent) feel employee performance reviews have no impact on how they do their job; 58 percent say they’re a needless requirement.
Employers don’t disagree. Forty percent of HR leaders say they don’t think employee evaluations provide an accurate estimate of employees’ work, according to a survey conducted by Globoforce and the Society for Human Resource Management; 19 percent of HR professionals say they aren’t sure if their reviews are even accurate.
Clearly, within many companies, at least one element of the employee performance review system is broken.
Luckily, in recent years, several studies have revealed fresh insight into what actions resonate with workers — and what demotivates them. A few of the findings that can help companies more fully understand how to evaluate employees’ performance include:
A one-size-fits-all approach to communication may not work
A varied approach may be needed across an organization to achieve maximum results. Sixty-two percent of millennials, for example, have felt blindsided by an employee performance review, according to a TriNet survey; 74 percent say they often are unsure about how their managers and peers view their work. More than a quarter looked for a new job after an annual review.
Various studies have shown millennials favor frequent feedback. A formal, annual system is the antithesis of that; instead of giving them room to grow, the evaluation process simply points out they’ve been functioning inadequately in some areas — for as much as 12 months, as the incorrect behaviors were repeatedly reinforced; which isn’t the best prospect for employees or employers. To encourage maximum performance, managers need to consistently offer instruction, praise and constructive criticism — to all age groups, in the manner and frequency they prefer.
Evaluation is not enough
In a sense, employees are evaluating their company’s managerial performance, too. Yet a BambooHR survey found 67 percent of employees working at companies with a staff of more than 50 feel they aren’t heard during reviews; 62 percent say they never see changes occur from feedback they provided, and 55 bring up concerns during their employee performance review that aren’t ever addressed.
Review your employee evaluation process and, if it doesn’t include a way to share information obtained during reviews, add a reporting structure and an action plan to address key employee issues.
Workers want you to strategize, instead of just focusing on the past
More than half (52 percent) say their company doesn’t help them make or meet goals. If your organization’s employee evaluations solely center on current performance — but provide no way to address workers’ potential for future growth — you’re missing out on much of the practice’s potential impact.
Don’t become one of the employers 61 percent of workers say fail to provide any career development after a review. Incorporating steps into your employee performance review process that outline ways managers can work with their subordinates to establish and monitor progress employees make toward long-term goals can help strengthen engagement — and fuel your succession planning efforts by preparing key team members to fill future roles.
Some companies are completely doing away with employee performance reviews. By late 2015, various sources said between 6 and 10 percent of Fortune 500 companies had; 5 percent of large U.K. companies were also considering eliminating them, according to PwC research. Willis Tower Watson estimated in December more than a quarter of U.S were considering or planning on eliminating performance ratings.
That doesn’t mean, however, that reviews aren’t right for your organization. In fact, separate research from the Corporate Executive Board found although managers have more time without review work, instead of shifting it toward informal performance conversations, they actually spend 10 less hours providing feedback. Without the ability to set clear expectations and provide accurate recognition, CEB found employee engagement drops by 6 percent.
Reworking your current employee evaluation system, instead of tossing it out with the trash, may help you achieve a better outcome.
Some organizations have found asking workers to evaluate themselves shows them their opinion is valued and can encourage them to become more involved in the employee review process. Other companies have found value in adding more informal, frequent reviews to their calendar.
For more ideas on improving the evaluation process, view our blog posts on giving employees a voice through pulse surveys, accurately assessing and recognizing rising stars who could fall through the cracks, helping employees grow by giving them additional responsibilities and making the most of the employee self-evaluation effect.