Employee appraisals, performance reviews, end of the year appraisal. Whatever you call it, the concept is pretty much the same, but not when it comes to continuous performance management.
Let's get one fact straight, traditional performance reviews aren’t working. They are broken - simple as that.
A few years ago, a global study run by Willis Towers Watson found that less than half of employees felt that their performance appraisals were effective.
For HR professionals, that’s a particularly damning number and that's when finding the solution becomes important, so why not think about implementing continuous performance management? Let's find out what it means and how you could benefit from it.
What is continuous performance management?
It’s a process designed to evaluate and measure an employee’s performance, however, instead of having yearly reviews, the continuous performance management process happens several times per year.
What does continuous performance mean?
Identifying room for improvement, highlighting areas of success, and generally checking on how things are going on a regular basis.
It's not about asking more of your team members, but about creating an environment where feedback becomes frequent and second nature for managers and team members alike, making it easier to collaborate and set employee goals.
Traditional performance management vs continuous performance management
Running annual appraisals is a slow-moving method for checking up on your employees. It creates huge swathes of time where feedback and self-reflection are not a priority.
On one side, employees feel that the assessment of their entire year swings on a single conversation.
On the other side of the table, managers are as equally unhappy. Not only does the system create a huge backlog of work, but they need to have interview after interview with staff members who are perhaps already on edge, discussing projects that could have happened up to a year in the past.
With continuous performance management, the clue is in the name. Instead of the once-per-year annual review, employees have regular check-ins and touchpoints with their managers. Feedback shouldn’t be a yearly event but rather an integral part of an employee’s day-to-day.
General Electric has been the trailblazers here, creating their own app that helps employees and managers maintain a constant dialogue with each other.
We are by no means saying that you need to go out and have your own app built - there are plenty of other options available to you.
You could for example choose to use Charlie’s very own Reviews feature – automate your review cycles and drive real conversations between managers and team members.
Maybe you’d like to try it yourself. Sign up today for a 14-day free trial. No credit card required.
The 5 top benefits of continuous performance management
1. Feedback is 360 when it comes to continuous performance management
Continuous performance management isn’t reliant on top-down input from managers like the traditional appraisal system. After all - management is a continual process.
Instead, feedback is encouraged from every direction. This includes sideways - from peers and colleagues - as well as upwards, where team members give feedback on their boss’s performance.
The major advantage of this approach is that it encourages a much fuller picture of everyone’s performance.
High-level managers, particularly CEOs, can often have a very ‘gappy’ impression of who is doing what in their company - for the very simple reason that they can’t see everything.
2. Continuous performance management saves time and effort for everyone
As you might imagine, compressing a year’s worth of evaluation and feedback into a single interaction is an absolute nightmare.
That’s where continuous performance management comes in to save the day. By doing reviews more regularly, it’s more likely that both employees and managers will be able to focus on what has been done in the past few months.
The reflection on the work will go into more detail and not just include a general overview of what it’s been like over the year – it will also make it a fairer process.
On top of this, it will be more straightforward as both managers and employees won’t have to keep tons of documentation by their side. What they worked on will be fresh on their mind.
To make it even easier for everyone, you could use a Reviews feature like the one we have in our software.
Employees share their feedback first. Managers follow. A meeting ensues to discuss – your notes are safely kept in the software. You get notifications to remind you of when it's time to submit your review.
3. Continuous performance management helps tackle underperformance issues
When you get a new hire, it’s usually through the probation period that you can decide whether this person is up to the task.
However, probation periods can be short – what if you missed something? Would you really wait a year to address it?
It’s the same when it comes to exceptional circumstances. A personal event might affect the way your team member is performing. If they don’t take the initiative to talk to you about it and if you don’t have regular catch-ups, it’s likely you won’t be able to understand what’s going on and therefore make the wrong assumptions.
Continuous performance management is a handy way of checking whether team members need support or giving them feedback on what they could improve.
That way, you can address issues before they become bad habits and make sure team members are not caught by surprise as you pointed it out to them right on time.
To find out more about how to tackle underperformance issues in a way that's both compliant and fair to your team members, download our free guide.
4. Continuous performance management makes employee development a priority
Traditional performance reviews have often included a token aspect of employee development - but it has regularly overlooked just how powerful a tool it can be, for both the employee and the employer.
Here’s the trick:
If you can identify what your employee wants to achieve in their professional lives, then you can agree together on how they can achieve that within the scopes of the business.
Help team members invest themselves in their job, and you’ll see them approach everything they do with a renewed sense of purpose. The happier your team members are at work, the more likely employee engagement will increase.
From an HR point of view, it also guarantees retention rates: people will stay longer at your company because they will see their careers evolve and their skills improve.
Finally, you'll be able to attract the best people by having a workforce that's been there for a long time and by advertising career development.
Get all of it done and reap the benefits together. Perhaps you could even put a career progression framework in place so your team members have a clear idea of where their career is going.
5. Continuous performance management makes development second nature
When you really break it down, the reason that employee reviews exist is to try and improve your team’s performance. Traditionally, that has meant managers telling an employee where they should be improving.
But the end goal is really to take the managers out of the equation altogether - for employees to be self-reflective about their performance, and identify their strengths and weaknesses independently.
Achieve this, and the hard work is already done. If employees are taking ownership of their performance at work, they will become better by themselves.
With Charlie, it's also up to you to decide how often these conversations should happen. At Charlie, for example, we do this every four months to allow enough time and material to reflect on, but that’s really up to what you think is best.
What’s more - we allow you to fully automate your review process, so you can ensure that meaningful conversations take place across your company, effortlessly, so perhaps it's time to have a look at our software.