LTC Newsletter – October 2023
“It’s Broke, and We Really Need to Fix It!”
By Terry Lauter Comp
Performance Reviews– that dreaded annual obligatory routine that strikes fear into the hearts of HR departments, employees, and managers everywhere! Despite all of the innovation and progress in technology and automation of systems over recent decades, here’s one traditional business system/process that still very clearly misses the mark. Recent Gallup research indicates that fewer than 20% of employees are inspired by their reviews, while 95% of managers are dissatisfied with their review system. As depicted on the cover of a recent edition of HR Magazine, it’s a broken system that most definitely needs to be fixed if we intend to retain and motivate top performers into the future.
For many reasons, “fixing” this problem isn’t easy. But whether you are re-engineering the system you have in place or starting from scratch to build one, here are a few thoughts to consider as you assess the problem:
- It’s not about the form, the computer software, or the rating system. In our experience, the most important part of the process is the CONVERSATION. Unfortunately, managers in many organizations today are simply ill-equipped to have a meaningful two-way conversation that goes beyond a quick look in the rearview mirror with their team member. We all know by now that Millennial and Gen Z workers are looking for much more. The conversation should include at minimum:
- Strengths and growth opportunities observed by the manager, with specific situational examples. This gives the team member an opportunity to talk about these and add their insights.
- Discussion about the employee’s goals and dreams for the future. Share how he/she might develop the necessary skills to grow in the current organization to higher levels in alignment with his/her goals.
- Opportunity for the team member to contribute to the process via a personal reflection or self- assessment prior to the review and the conversation.
- Opportunity for the team member to share any feedback he/she may have for the manager.
- We could talk for hours about appropriate measures of performance and systems to rate them. But for starters, let’s just conclude that setting goals (in alignment with the organization’s goals) is a good way to make the process much more than a once-a year obligatory exercise. Having well-chosen and clearly articulated goals also encourages an ongoing conversation throughout the year as conditions evolve and milestones are met.
- Communication, communication, communication! Having rich and meaningful conversations on sensitive subjects requires skills that are not often innate in managers and leaders. The best system in the world is only as good as the manager who is clearly competent in using it. Good training and communication of managers and team members is essential.
One final thought: Determine your goals for the system prior to the start of your process, so that you can focus on priorities. There is much to consider, and it likely can’t be accomplished all at once. In other words, fix the most important things first!
Our team is constantly working with a number of companies who are designing and/or re-engineering their review systems and processes now. If you need assistance with the design/re-design process or in communicating and training your team, click here to connect with an LTC Performance Consultant now.
Terry Lauter Comp is a founding principal at LTC, with experience as a Corporate HR Vice President, national/international consultant, graduate/undergraduate business instructor, author, and community leader. She serves as Practice Leader for Performance and Organizational Development. Terry received her MA degree in Educational Psychology from UCLA and has been accredited as a Sr. Professional in Human Resources (SPHR). She is the co-author of the book, “Think Inside the Box: The Secret to Partnering with Your Employees to Drive Growth and Profit.”
The HR Magazine article referenced earlier is included here for additional insights: