How the Best Leaders Conduct Successful Performance Reviews

The thinking and policies regarding performance reviews have experienced a shift within organizations. HR researcher Josh Bersin estimated as many as 70 percent of multinational companies are moving away from the outdated annual review approach to performance management. In the last five years, corporations including GE, Adobe, Microsoft, and Dell have axed annual performance reviews.

Eliminating these practices means leadership in the workplace can take priority over management. The problem is that 30-40 percent of companies still utilize annual performance reviews and most employees hate them. Conversely, the vast number of companies that do not rely on performance reviews are burdened with managers struggling to give constructive feedback.

Great leaders give constructive feedback day in and day out.

The most successful leaders give constructive feedback to their employees on a daily basis. This method is successful because these leaders do two things well:

1. Document positive and deficient behaviors of team members
2. Provide feedback in as close to real-time as possible

On the Follow My Lead podcast, I asked Dave Needham, CEO of Ohos, "Why do so many managers struggle to do these two things in today's business environment?" His response was, "What managers struggle with is the amount of time it takes to document things that create effective feedback conversation or even a performance review."

Dave is right. It is common today for managers to have 10 or more direct reports, many of whom are working in different time zones and primarily communicating via Slack or email. The amount of one-on-one time managers receive today is much different than in years past. This is not an excuse, however. With the ban on performance reviews must come an environment in which managers can deliver feedback on not only the results but the behaviors and habits of their team.

While formal performance reviews are becoming old-fashioned, this does not mean they have to be ineffective. In fact, with remote teams, a quarterly review is often a good option. Classical Conversations, a leading homeschool education company, has a primarily remote workforce, and because of this, they find the quarterly employee review to be extremely effective. If performance reviews produce great results for your organization, ensure you do these three things:

1. Get Data from More than Just Yourself

It is impossible for one person to have eyes on everything. You will always find that people are excellent at straightening up in their chair and putting their best foot forward when the boss comes around. This gives even more of a reason to plug into those who interact with the team on a regular basis. Data from co-workers or team members can frequently provide the most insight into the positive and negative behaviors of an individual.

2. Relay Data on an Ongoing Basis

An alternative to sharing performance data once a quarter or once a year is finding a way to share live data on an ongoing basis. This provides people with a means to be informed on how they are doing across results, behaviors, teamwork, positivity, or work ethic. Basketball games have scoreboards for a reason--no one wants to guess who won the game when the final buzzer goes off. Yours does not have to be an elaborate system. It could be as simple as a spreadsheet with the key metrics being updated both the manager, direct report, and co-workers.

3. Be a Great Coach

One of the most important actions any manager can take is being a great coach to their people. Fighting the urge to tell people what or how to do something will help strengthen their skills and ability to perform. Choose to coerce their ideas out. Great coaches live out the saying, "Education of the mind without education of the heart isn't education at all." Get inside the heart of your team members and drive their best self out by building upon their strengths and improving deficient behaviors.

Whether you are in an organization that continues to have quarterly or annual performance reviews or not, employ these lessons to improve the performance of your team members.