Canadian HR Reporter

Canadian HR RepoRteR december 1, 2014 14 FeAtures technology The demise of the annual review Why not try regular, web-based feedback instead? By Michelle Berg t he dreaded annual review may finally be on its way out, making way for con- tinual, honest communication between managers and employ- ees throughout the year. Companies that cling stubbornly to the annual review — a concept born in the 1950s when employ- ees worked for the same em- ployer for 35 years — could die a slow and painful death. at's because annual reviews need a lot of improvement when it comes to boosting employee performance and engagement, and helping managers build productive rela- tionships with their teams. After all, how can a conversa- tion that happens once a year, based on irrelevant scores that rate canned competencies, do anything but increase anxiety for all parties involved? Instead of the annual review, many companies are adopting new team feedback platforms that foster open communication between managers and employ- ees all year long. ese solutions stimulate conversations and treat performance management as an everyday check-in, rather than a once-a-year meeting. What makes it work is a tech- nology platform that encourages open discussion between manag- ers and employees. After all, per- formance management shouldn't be about saving time — it's about helping employees grow and reach goals. Faults of the traditional system Can everyday communication really replace the annual review? Doesn't management need yearly "scorecards" to track employee progress and performance? To answer these questions, HR professionals must ask themselves why they do annual reviews in the first place. If it's for legal purposes, most reviews are written so poor- ly they can hurt the organization rather than help mitigate any fu- ture litigation issues. If it's for coaching purposes, does filling out a form once a year really prove coaching and development has taken place? If it's for communication purposes, should you wait to communicate with employees about their ideas, goals and progress until the end of the quarter or year? In idealized terms, the an- nual review is supposed to help employees grow and seize new opportunities. The problem is something called the "recency effect" — we rarely remember what happened last week, never mind one year ago. Yet, on the an- nual review form, employees and managers are asked to remember everything that happened in the last 12 months and document it accordingly. Case studies In looking for an ongoing per- formance management solution to encourage constant feedback — especially for employers with multiple locations and employ- ees scattered far and wide — El- evated HR wanted a web-based feedback system that could both foster and keep track of organic conversations. While analytics were impor- tant, we knew employee growth and development wouldn't hap- pen by filling out a form or push- ing buttons with fancy pre-popu- lated comments. e technology needed to automate the feedback process while promoting the hu- man touch. Our organization chose an app called 15five. e premise is simple: Each week, managers ask employees a few questions that take 15 minutes to answer. Man- agers then take five minutes per employee per week to respond to feedback, spotting issues and highlighting successes directly within the web app. After implementing the plat- form, we quickly saw the value of weekly conversations that were automatically recorded. Employ- ees and managers could commu- nicate on their own time and felt empowered to do so because the simple Q&A-style interface wasn't as daunting as a blank form. We soon saw the benefit of addressing issues weekly instead of waiting months while things got worse. There was instant improvement in employee en- gagement and a clear impact on productivity. Hotel chain Western Canada decided to implement the same platform, citing communication and employee growth and devel- opment as the main goals. Em- ployees and managers saw annual reviews as an "exercise in futility" that had no impact on company growth or employee success. And with multiple locations, the hotel group needed a web-based plat- form accessible from any device, but also one that was fast and easy to use since hotel employees were often busy serving guests, not sit- ting in front of computers. e hotel group was able to ad- dress training requests as needed, instead of annually. In one case, a manager was able to mitigate a potential resignation by handling a rumour immediately, instead of letting it fester. After a financial firm imple- mented the software, manage- ment was soon asking if there was any reason to keep doing annual reviews the old way — by filling out a form and sitting down to go over it. With the employee feed- back app, managers were so tuned into their employees' goals, ideas and progress each week, an annu- al review just felt extraneous. For the upcoming year, the company decided to skip the annual review altogether. Performance management should not be a formality. It's an ongoing, active, engaging process to motivate and connect with employees. When employees are aligned to hit and achieve regular goals — and managers can keep track of employees' progress, achievements and setbacks using a simple, weekly check-in — your company will undoubtedly see in- creased revenues and profitability. Michelle Berg is president and CEO of Calgary-based Elevated HR. She can be reached at michelleb@elevatedhr. com. Faculty of Education Centre for Adult Education and Community Outreach Faculty of Education Centre for Adult Education and Community Outreach Credit: Stefan Amer/Shutterstock

• Cover