How to Make the Case for Continuous Performance Management

Performance reviews are going out of style. Adobe uses check-ins, J.P. Morgan launched real-time feedback, and Accenture led the way back in 2015, citing bad ROI as the determining factor for eliminating its ratings and annual review program in favor of continuous performance management.

These innovative companies aren’t just leading the charge — they’re already posting results. Of companies that transformed performance management in the past two years, conversations increased 83% in frequency and 100% in quality, according to NeuroLeadership Institute. In addition, companies saw 80% increased pay differentiation, and employee engagement increased 100%.

Change doesn’t happen overnight. Click To Tweet

Change doesn’t happen overnight. The following are three keys to making your performance management transformation a success, and help you orchestrate lasting change that will impact company growth well into the future.

Determine Success Metrics

You likely run an engagement survey, and it shows your people want more feedback. You have a retention problem, and it costs up to 200% of an employee’s salary to replace him or her. On top of that, your succession planning is on hold because you aren’t able to develop talent to fill these newly opened leadership positions.

There are no shortage of problems, but which of them do you have data to back up? When you make the case for better performance management, sometimes investing in a new system as well as training, you must use your problem metric as a future success metric.

For example, if you’re in the services industry and your turnover hit an all-time high of 20%, you’ll want to set a measurable goal of where it will wall after you launch your new program.

At WeddingWire, a new initiative, a manager effectiveness score, is being rolled out with their performance management program. The ecommerce company uses a 360 review program to measure core attributes for managers in every department, which helps the people team keep themselves accountable for employee success, and indicates where to focus training and development.

Go For the Long Game

You’re the expert. You know traditional performance management requires no small amount of time and money, but the results are abysmal, if not problematic. But you’re changing a system that’s been standard for more than 50 years. Even when it’s a good change that benefits everyone affected, change is scary.

WeddingWire achieved this change with a methodical plan that can be used as a template for other companies looking to get started.

You know traditional performance management requires no small amount of time and money Click To Tweet

The original state of performance management at WeddingWire were reviews done on paper, including both a self-assessment and a manager review. The people team’s first step was to shift the paper review to using a performance management tool on its HRIS. This review followed the same format, and the people team received employee feedback that it was too long and detailed.

The following year, the review was limited to seven questions, which employees answered about themselves and managers answered about their reports. Still, the company’s annual engagement survey showed employees weren’t getting feedback. Survey results confirmed what WeddingWire’s director of people Kara Scovitch was seeing in industry research. As a result, the company decided to move forward with a continuous feedback approach to performance management.

The final step was to find the right tool for the modern performance program, and WeddingWire chose to launch Reflektive.

Note this transition required at least three review cycles, which can be done annually, biannually, or quarterly, depending on your company’s original state.

Run Employee Engagement Surveys

As with any big change initiative, transforming performance management relies on employe buy-in. If you already run engagement surveys, this is likely what tipped you off to dissatisfaction with reviews or an appetite for more feedback. This survey will help you design a performance management program around your workforce’s unique needs.

Run an engagement survey before making changes to surface pain points. Then, run the survey after your change to measure impact, and iterate your approach. Some questions Protective Life asked its workforce include “Do you know where you stand with your manager” and “I know what I should focus on for the next 90 days.” The results of this survey indicated to leadership that the quarterly check-ins and goals program was driving employee development and alignment.

I know what I should focus on for the next 90 days.

WeddingWire ran their survey after launching Reflektive and saw an increase in communication, transparency, and recognition, which Scovitch attributes to the new performance program.

The engagement survey should be run annually at minimum, but Reflektive director of employee success Rachel Ernst recommends running a survey every three months to check the temperature of employee feedback programs. Suggested poll questions include “How regularly does your manager check in with you?” and “Please rate the quality of your check-ins.”

Transforming performance management is a big task, but it’s well worth the effort.

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