We’ve read the articles. The annual performance review has been dying a slow death for the past few years. More and more, companies are realizing that traditional performance management is a large cause of low employee engagement and high turnover.
Fortunately, there’s a wave of companies, small and large, that are redefining performance management from the ground up. From ditching the annual review all together, to implementing real-time feedback, these five companies are trailblazing the new path in performance management across all industries.
SEE ALSO: How to Effectively Change Performance Management
If you think that large, traditional companies are unable to overhaul their age-old processes, think again. With over 300,000 employees worldwide, Accenture was able to ditch annual reviews and stack rankings all together.
The tech consulting giant was able to humanize their performance management process by eliminating processes that evaluated employees as mere numbers on a page. The result? More timely feedback on assignments, and a more equitable compensation process for all employees at the company.
“We’ll eliminate the traditional closed-door ratings meeting where we talk ABOUT people. Instead, we’ll talk WITH people in frequent coaching conversations.” – Ellyn Shook, Chief Leadership & Human Resources Officer at Accenture.
Year after year, Facebook tops the list of the world’s best places to work. It’s easy to attribute this trend to their universally known fun work environment and great employee perks, but if you dig deeper, you can see what actually causes Facebook employees to be more motivated and satisfied.
Facebook, like many companies of its size, holds semi-annual reviews that focus on peer-to-peer and employee-to-manager feedback. By zeroing in on peer feedback, Facebook managers get a good picture of how employees collaborate with one another, a value that is crucial to the company’s success.
Additionally, using internal software, Facebook managers and employees are able to give and receive continuous real-time feedback in between review cycles. Under this system, employees are no longer surprised by their reviews, because feedback is ongoing throughout the year.
Back in 2013, Microsoft realized that their stack ranking-style performance management system was negatively effecting employee engagement and motivation.
Since the departure of their old CEO Steve Ballmer, Microsoft has revolutionized their performance management to put more power in the hands of managers.
Microsoft now holds bi-monthly performance reviews. These check-ins are formal, structured conversations between managers and direct reports, in which they discuss goal progress, skill development, and more – so employees know if they’re moving in the right direction while they still have time to adjust.
“Our new approach will make it easier for managers and leaders to allocate rewards in a manner that reflects the unique contributions of their employees and teams.” – Lisa Brummel, Microsoft
4. Goldman Sachs
If a company founded in 1869 can transform its outdated and ineffective performance management, anyone can.
Goldman Sachs’ old performance management system focused heavily on annual reviews, stack rankings, and ratings – all of which have been shown to have detrimental effects on the workforce.
After various internal surveys indicated employees wanted more continuous feedback, Goldman Sachs adopted their own web-based tool for giving and receiving feedback in order to increase informal performance conversations.
“Providing high-quality and ongoing feedback is at the heart of our culture, and is an important investment we make in our people and the future of our firm.” – Goldman Sachs CEO Lloyd Blankfein and President Gary Cohn
After relying on inconsistent Google Docs for performance management, Instacart decided that they needed a system that would allow them to align their employees’ performance with the changes in corporate priorities.
Enter Reflektive. Instacart implemented Reflektive’s Real-Time Feedback tool and reviews in order to give employees the responsiveness they needed to be nimble and keep up with the changes around them.
Since they started using Reflektive, Instacart has generated over 975 unique pieces of recognition and over 3,900 interactions through Real-Time Feedback. With tools that integrate into their communication methods, such as Slack, they’ve found an effortless way to keep growing quickly with the transparency they desire.
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