Perhaps you have heard: The performance review is dead—at least, that’s what a lot of analysts out there are saying. We recently spoke with a coaching expert to discuss what should take its place.
Source: bleakstar / shutterstock
Yael Shafrir is the Chief Marketing Officer of Meet in Place, a global network of innovative meeting spaces designed for an urban boutique hospitality experience.
HR Daily Advisor: I understand annual performance reviews are broken. Can you explain what that looks like?
Shafrir: What we see is a system that’s broken in several ways. First, by the time the review actually happens, much of the behaviors and outcomes under discussion have already been forgotten by both parties. Second, it’s already too late to correct or improve aspects of an employee’s work by this point. Like a New Year’s resolution, it’s thought about and discussed, and intentions are good. Actual outcomes, however, are another story.
Third, the rating system used is, in our opinion, archaic and unhelpful to all concerned in the current workplace environment. Finally, it is employer-centric and does not take into account employee desires such as growth, culture, values, and mentoring.
HR Daily Advisor: What alternative do you suggest?
Shafrir: The alternative suggested by experts is the “real-time coaching conversation.” This is a less formal review whereby leaders—in whatever form—can impart knowledge on employees, assist in their growth, and tackle challenges at their source. Transforming an end-of-year session into an ongoing process means that attention, mentoring, and focus on employee development should be part of a business routine that companies and managers need to adopt in order to truly motivate and engage their teams.
Keeping in mind the decrease in average lifetime value of an employee (recent research shows 20 months), waiting a year or even 6 months to provide feedback, develop an honest dialogue, and provide manager-employee consulting is obviously outdated.
HR Daily Advisor: Is real-time coaching able to convey feedback to employers?
Shafrir: It can in the most tangible way possible: with results. While there are mechanisms available to score and track the results of real-time coaching conversations, the beauty of this approach is that its effectiveness is immediate. If, for example, a sales team member is being overly aggressive in taking colleagues’ leads, waiting to address this in an annual review will lead to a toxic team culture. Addressing it on the spot with a coaching conversation will immediately yield more positive results. This approach provides both employees and employers with the opportunity to correct behaviors, improve outcomes, and grow people on a constant basis.
What is really important is that by the end of that year, the employee who was constantly coached will be in a totally different place—he or she will have overcome barriers, dealt with challenges, grown, and developed in a way that enables the next step in the person’s career. In a work environment that’s becoming more and more hectic, such growth spurts are not only efficient but also imperative to creating a solid, healthy, and sustainable HR structure.
HR Daily Advisor: How achievable is such an approach for a company that has known nothing but annual performance reviews for time immeasurable?
Shafrir: We think this is absolutely achievable in a short amount of time. The secret is starting this approach at the top. In an anecdote we quoted in a recent article, Microsoft’s CEO Satya Nadella overcame years of “annual performance review culture” by setting a personal example when it came to a coaching-oriented approach. The results, and positive culture changes, followed quickly.
HR Daily Advisor: What kind of time needs to be dedicated to this approach?
Shafrir: While this would depend on the type of organization and even the work of a specific team, we posit that the time investment in this type of approach is always worth it. Looking at that Microsoft example again, when “annual performance review culture” was in vogue at the company, literally months were lost as managers prepared for these dreaded reviews.
Another advantage of real-time coaching conversations is that results are cumulative. As these conversations happen and behaviors and skills improve, there is less of a need for them. Another way to look at it is to reexamine ongoing meetings, like your weekly or monthly sessions. Instead of sticking to mere reporting, managers can devote part of these sessions to coaching. Talk not only about what was done or achieved but also about the implications, what could be done better, what’s missing to improve performance, and so on. This means we do not necessarily need to dedicate more time but rather should use the time we have differently.
HR Daily Advisor: What are some common challenges employers have rolling out real-time coaching, and how do you address them?
Shafrir: A common challenge is buy-in, both from employees and from company leadership. People can loathe giving up processes, even if they understand on a deep level that they are no longer effective. We advise organizations to focus on the “why” of real-time coaching conversations—why they’re effective, why they’re beneficial to everyone, etc. It’s also important to keep in mind that not every employee should be coached in the same way. Managers need to be flexible and present their feedback in a way that will resonate best. For instance, some employees might respond better to a private conversation at an off-site location instead of being coached within earshot of their peers.
HR Daily Advisor: Any advice specifically for HR?
Shafrir: HR can be a key driver of this process. Indeed, this approach can fundamentally shift an organization’s performance to the next level, and HR has an opportunity to lead from the front. The change starts with discussions with senior leadership. We advise getting discussions started around the advantages of real-time coaching conversations as early as possible and avoid presenting them like they’re the latest HR trend. The investment in people and the constant quest for the best ways to optimize engagement, improve motivation, and decrease churn are key to a company’s success, and management should understand this sooner rather than later.
HR Daily Advisor: What is something about coaching you wish every employer understood?
Shafrir: Like elite athletes, organizational excellence can be driven by having a coach who can constantly improve behaviors. Every leader within an organization is a coach in waiting. To take results to the next level, it’s time to minimize the emphasis on annual performance reviews and implement real-time coaching conversations.