By Andie Burjek
Jun. 22, 2020
Conducting and writing performance reviews for your employees is something on many managers’ minds right now, especially with a growing number of employees joining the remote workforce. But even before 2020, a lot of the same issues and questions confronted managers. How valuable is the annual review? Should it happen more often or not at all? How do managers treat remote workers versus employees in a workplace?
For companies with mid-year employee check-ins, they now face the reality that as they look ahead to the rest of the year, the pandemic doesn’t have an immediate fix, said Lori Holsinger, senior principal with Mercer. There’s a desire for “business as usual” but the future is uncertain. This means companies must provide leaders and managers clear guidance on how to approach these conversations with employees.
Holsinger provided guidance on conducting and writing performance reviews. While these tips can help companies deal with performance reviews during a crisis, they are applicable in good economic times as well as bad.
In-person versus remote performance review
Generally face-to-face is the ideal way to conduct performance reviews, but video also provides an effective way for managers to have conversations with employees.
Much of the conversation will go the same, but there’s just one key difference. Video performance reviews give employees the chance to record the conversation relatively easily, Holsinger said.
Proactive companies remind managers of what they should and shouldn’t say, phrasing of certain statements and what they can say to help employees understand the message, Holsinger said.
“We are hopeful that regardless of where [this] dialogue between manager and employee happens, it could be recorded and shared with anyone and we’d be proud of what our leaders say,” she said. “[So] even if I’m providing a difficult message to an employee, I do it in a way that’s respectful, empathetic and honest. [But] the reality is sometimes managers struggle.”
According to Mercer’s 2019 “Global Performance Management Study,” eight out of 10 managers lack the skill to give feedback and provide coaching to employees.
“It’s a number that companies have been wanting to address for some time, and unfortunately it’s a number that tends to stay pretty steady over time,” Holsinger said. “In part that’s because there’s not a quick fix to increase manager skill in the area of having empathetic, honest and direct conversations.”
It takes time for managers to build these skills, and companies need to be patient.
According to “Performance Transformation in the Future of Work,” a Mercer paper that explores insights from Mercer’s performance management study, only 2 percent of companies have a feedback-rich culture today. Further, only 30 percent of companies rate managers on their people management capabilities, and just 9 percent link manager compensation to the people side of their leadership role.
Frequency of performance reviews
There’s no one size fits all approach for how frequently managers should be conducting and writing performance reviews. But one major lesson from the COVID-19 pandemic is that frequency may depend on an organization’s stability.
“If we think about any shift that suddenly requires people to work differently, we want to see communication increase. But as things begin to stabilize, that communication does not need to be at the same height,” Holsinger said.
Frequency may also depend on the type of organization. High-growth companies and startups likely will require more frequent performance reviews than a more stable, well-established organization, Holsinger said.
“The key is to ask, ’Is there any chance that this employee is unclear on what our priorities are as a business, what their contributions should be to the business or to the team, and what they need to do on a day-to-day basis?’ Because you want to make sure that the frequency of communication follows alongside that,” she added.
Companies with an overly regimented strategy may be doing employees a disservice, she said. For example, some companies may conduct regular monthly or quarterly performance reviews. While this might work for certain business units that see a lot of change and growth, more stable teams may see this as a waste of time. Performance reviews should not happen when they aren’t necessary, Holsinger said.
Meet employees where they are
According to research, the best manager-employee relationships are the ones where managers meet employees where they are in terms of their current job and their long-term goals. Holsinger said. Managers can build that trust between themselves and those they manage by showing that investment in their career as it is now and in their career growth.
Rethink the term ‘performance review’
The term “performance review” can come off as dated, Holsinger said. It comes across as managers simply focusing on the “rearview mirror” rather than using that discussion as an opportunity to look ahead and talk about career growth and development.
While many companies tie performance reviews to compensation, that’s not enough. Companies also have the opportunity to tie performance reviews with organizational goals, its mission and vision, she said.
“Let’s not lose our focus by saying that the main focus should be linking performance and compensation,” she added. “But rather the existence of performance management, the reason we want managers and employees to have conversations, is to help the employee better contribute to our overall purpose as a company and our strategy. And by the way, if you as an employee can do that, we’re going to reward you — not only with compensation but also through your career growth with our company.”
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