Imagine a performance review that’s not a stressful hurdle, but a springboard for growth. A conversation, not a checklist, that unlocks potential and fuels ambition. Believe it or not, this isn’t a fantasy.
By rethinking the traditional review process, companies can harness the power of performance reviews to create a win-win situation for both employees and employers. We’ve gathered insights from CEOs, founders, and other experts to explore constructive alternatives. Let’s explore how to transform this often-dreaded ritual into a positive force for progress.
Provide ongoing feedback
Performance reviews can lead to a toxic workplace if all leadership cares about is high performance at all costs. This situation can create implied competition among employees and lower team morale. Most people want to know that their work matters and that they are on the right track to achieve what is expected.
Performance reviews can be constructive when they are ongoing conversations. Many managers only provide a review at the end of the year, while the conversation about performance should happen regularly during one-on-one meetings. It’s challenging for any employee to hit their target goals if they are not coached on how they are doing during the process. Avoiding performance conversations during regular check-ins is more common than people think. I’ve worked for four managers who would not provide feedback until the actual performance review at the end of the year.
It wasn’t company policy, but their preferred method of working with employees. At the end of the year, you would never know what to expect from the conversation. I remember walking into those meetings concerned about the outcomes. It was tough to know if I had exceeded expectations because I didn’t receive feedback on my work and didn’t know if I was on the right track.
Performance reviews should be an ongoing conversation during regular one-on-one meetings, and if you are not on the right track to hit your target goals, it’s best to know early rather than wait until the holiday season to receive that feedback.
Knowing whether you are performing well helps you course-correct, understand expectations, and ensure you, your manager, and team members are on the same page. It can boost team morale and productivity.
It also helps you understand if you are on the path to a promotion and what you can do to achieve that. People don’t deserve to work without knowing whether they are doing a good job. Ongoing feedback helps people learn and grow.
Ana Goehner, career strategist and well-being expert, Digital Butterfly Communications, LLC
Ensure equitable and inclusive feedback
Performance reviews can cause significant harm when the conditions under which they are conducted are not equitable and inclusive. Bias, lack of transparency, and inconsistent evaluation criteria can undermine the fairness of these reviews, leading to demotivation, dissatisfaction, and even attrition among employees. When performance reviews do not account for diverse perspectives and experiences, they risk marginalizing certain groups and perpetuating inequalities within the workplace. This not only harms individual careers but can also stifle innovation and collaboration, ultimately affecting the organization’s overall performance.
One effective tip for supporting inclusive and constructive performance reviews is to implement a structured feedback system that incorporates multiple perspectives. Encouraging peer reviews and 360-degree feedback ensures a more comprehensive and balanced assessment of an employee’s performance. This approach helps mitigate individual biases by providing a fuller picture of the employee’s contributions from various angles, fostering a culture of fairness and continuous improvement.
Vivian Acquah CDE, certified diversity executive, Amplify DEI
Provide two-way feedback
Creating a transparent and supportive environment turns performance reviews into catalysts for individual and organizational success. As an OD consultant, I guide organizations in implementing effective PMS that enhance performance and foster a positive work culture. By celebrating successes and continuously improving the process, performance reviews can become opportunities for growth rather than sources of stress.
Performance reviews often face criticism for fostering a toxic work culture. However, this negative sentiment usually arises from a lack of ongoing performance management and development focus. Shifting to regular check-ins and emphasizing growth can transform reviews into valuable tools. Clear, flexible goals aligned with company objectives, along with open, two-way feedback, foster trust and development. Training managers to provide balanced feedback and linking reviews to career growth ensures employees see their value.
Zil Pandya, consultant in organization development and strategic HR practices, NamanHR
Design for all-around growth
Performance reviews are a tool to further codify and reinforce the culture and behaviors you’re looking to achieve within a team or organization.
Ensure your process creates the foundational clarity for all members that is needed for them to be successful. This is much more than a simple goal-setting process and includes a concerted effort that includes:
- Leadership’s ability to align their strategic and culture plans
- All people leaders can translate this vision within their diverse teams
- Individual involvement and co-design around how individual goals are created each year. (This also includes regular updates of job descriptions and “social contracts” to ensure people are clear and inspired by their role within the organization.)
Being a role model of cultural values should be a part of the definition of performance, and all members (including the CEO/executive team) should have clear shared definitions around what each value looks like in action and when someone is at risk of derailing that value. Coaching and growth opportunities should be aligned with a member’s ability to influence and demonstrate these values.
Performance reviews are arbitrary pieces of documentation. What you should be focused on is creating a culture of feedback, candor, and safety for members to use their experience to grow and develop. This means ensuring all people managers/leaders have and are building capability in creating brave and safe spaces for their people and can effectively coach their people to performance and growth in a way that creates equitable opportunities for all.
Angela Howard, founder and CEO, Call for Culture
Provide training to have meaningful conversations
I get why traditional performance reviews have a bad rap—they often create anxiety rather than growth because they’re delivered untimely, wrongly, and by unqualified people. This is a harsh statement, but overwhelmingly true.
I’m currently working with an organization to reimagine their process, making it continuous and holistic. We’re implementing regular check-ins and 360-degree feedback, using technology to streamline and gather comprehensive insights from peers, subordinates, and colleagues. We’re also ensuring leaders are equipped to have meaningful conversations and deliver feedback through specialized training.
The focus is on providing actionable feedback that aligns personal growth with the organization’s goals. By making reviews timely and relevant, we turn them into moments of motivation and alignment, fostering a positive, growth-oriented culture. Embrace this approach to transform your performance reviews into powerful tools for both individual and organizational success.
Tara Furiani, CEO, Not the HR Lady
Build a culture of behavior-focused feedback
Performance reviews can contribute to a toxic work environment when implemented poorly, but companies can take steps to change the tone of performance conversations.
One of the most common challenges I see is that organizations struggle to build a culture of continuous feedback. Instead, it’s withheld until the annual or biannual performance review. This raises the temperature of conversations if employees haven’t developed the muscles for giving, receiving, and soliciting feedback.
Feedback is often unstructured, unspecific, or focused on personality traits. Bias creeps into the process, which holds marginalized employees back in their roles and threatens their sense of belonging.
Companies can avoid these pitfalls by teaching teams how to give behavior-focused feedback and normalizing the practice of doing it daily. When effective feedback is part of the culture, reviews can instead be an opportunity to celebrate wins and focus on growth goals.
Alex Lahmeyer, founder, DEI Consultant, and career advisor, Boundless Arc
Document touch-points throughout the year
Performance reviews have gotten a bad rap, but this is because they are rarely executed in a transparent, equitable, consistent, and constructive way. Expectations are unclear, goals become moving targets, and an employee’s advancement is almost always tied to the effectiveness of their direct manager.
Performance management should instead be an ongoing practice that encourages a two-way exchange of information that enables employees to be effective in their day-to-day work and positions managers to support their teams more effectively. This approach should be applied consistently across the organization with documented touch-points throughout the year.
Managers should be held accountable for the growth and development of their teams, and individuals and teams should be held accountable for their results. By the time annual performance reviews come around, there shouldn’t be any surprises—for anyone.
If employees are equipped with the right information and support, performance reviews can stop contributing to a toxic work culture and instead become a powerful tool for unlocking people’s full potential.
Alex Suggs, cofounder and partner, Different
Innovate with team reviews and feedback journals
Four of our last seven guests have shared their frustrations with how we handle performance reviews, especially the traditional annual ones. This tells us that the criticism about traditional reviews being toxic might actually hold some weight.
If ditching performance reviews altogether isn’t an option, we think the trick is in how they’re done: Managers need to be super transparent, make performance a year-round conversation, and tie reviews to the bigger business goals.
Our guests have also been testing out some cool, unconventional methods. For instance, David Hanrahan, the chief people officer at Flare, is trying out “team performance reviews” alongside the usual ones. He’s more into having a high-performing team rather than just a team of high-performers.
In an upcoming episode with Tracy Letzerich, VP of People at Wheel, she talks about how their managers keep “Feedback Journals” in their one-on-one docs with their direct reports. They give each other ongoing feedback to build that feedback muscle and avoid end-of-year surprises.
Stephen Huerta, cohost, The Modern People Leader Podcast
Improve with regular check-ins
I’m actually in the process of interviewing over 100 CHROs/CPOs at companies around the world for a new employee experience book. All of them say that their employees actually want annual performance reviews because there is value in knowing where you stand, in having a framework that everyone can adhere to, and in having a process everyone is familiar with.
Even companies that once abandoned annual performance reviews are going back to them. However, what companies are realizing is that there is a better way to do them. Feedback is given regularly (instead of once a year) to employees in terms of performance, but once a year they do a comprehensive review, including compensation. This approach seems to work well for everyone. Don’t get rid of the annual performance review, just improve it.
Jacob Morgan, author, speaker, and futurist, TheFutureOrganization.com
Make feedback available to everyone
I recently ran a poll on LinkedIn asking if folks had ever had a performance review that contributed positively to their development. Fifty-four percent of respondents said no. This is shocking.
So, although I disagree with the statement that they do more harm than good, I believe the devil is in the details, and the comments show why.
It’s all about ensuring that managers are equipped to hold conversations focused on past performance and future development. They need to review clear metrics and work with the team members on development plans.
The problem comes through a lack of knowledge of the goals of the business, the person, and working in partnership.
When you have thoughtful and open conversations, as we do at The People Collective, it makes a huge difference. All our feedback is available to the whole team so the focus is on constructive feedback and growth.
Matthew Bradburn, founder, People Collective