Why Fortune 500 Companies are Done with Performance Reviews

The Washington Post recently stated that 10% of Fortune 500 companies abandoned annual performance reviews in exchange for a more fluid management model. One such alternative is the weekly two-way, closed-loop employee feedback progress report (such as Atiim Pulse) in which managers give feedback for the employee and receive valuable feedback as well. It’s a far better approach because it’s frequent, with more real-time updates (versus once-a-year annual performance review), and allows for alignment and course-correction which ultimately improves performance and retains talent more so than those outdated, legacy performance reviews. Businesses like Gap, Google, Yahoo, and Deloitte have been longtime advocates for ditching the antiquated review approach, and now GE is on board, too. So what are the secrets behind their decision?

Use Agility to Your Advantage

You need to provide your people with up-to-the-moment, actionable feedback; otherwise, they have to wait for an entire year to find out how they’re doing. By then, it’s too little, too late, and any feedback you provide is outdated.

Save Time and Money

Providing more frequent feedback will actually take less time: Deloitte previously spent 2 million hours per year preparing for evaluations, and the typical manager spends 210 hours on tasks related to performance reviews. Giving consistent feedback that’s brief and actionable takes significantly less time.

Collect Useful Data

Access data – through an app, website, or other platform – to align employees and supervisors with transparent progress updates. You’ll improve communication between managers and their subordinates and get a heads up on any flagged issues.

Informed Employees are Happier

Happy employees are also engaged, high-performing employees. An agile, data-driven approach to feedback and performance is much more likely to make everyone happy and better aligned.

Are you still using yearly performance reviews? Going for a more light-handed yet consistent approach could unlock great potential in your people and your organization. Try Atiim Pulse Report today for free.

Do you manage a company or teams (either as a CEO, a senior executive, a middle manager or even a front-line manager)? Do you set and track objectives? Does aligning employee performance to business goals matter, and are you responsible for driving results? If so, please check out a live demo of Atiim OKR & Goals Management Software and we’d love to hear what you think about it. Thank you!

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