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Annual Performance Reviews Are a Waste of Time

October 5, 2018 • Practice Leadership • Mark Shepherd

Annual performance reviews.We have all experienced them at some point.The seemingly endless amount of paperwork where you and your superior have to use some sort of scale to quantify your effectiveness in the work place.This has had me thinking for years:Are these annual performance reviews effective?Are they worth the time and effort?


Are Annual Performance Reviews Effective?

Let’s check out the data.A recent white paper was written by Kimberly Schaufenbuel from the UNC Kenan-Flagelar Business School titled “Transforming the Traditional Performance Review Process“.These are some of the eye-popping (but not surprising) statistics reported in the literature regarding the painful annual performance:

  • 86 percent of employers report being unhappy with their performance management systems (see more here)
  • 8 percent of HR executives thought their performance management systems made a significant contribution to employee performance (here)
  • 35 percent of respondents from a survey said they trusted their employee ratings to be an accurate reflection of actual performance
  • 30 percent of survey respondents thought their performance management process improved employee performance
  • Only 3-5% of 10 survey respondents actually had performance change following their performance reviews

I am sure you are reading this and thinking, “yeah, not surprised.”Whether you are leadership or the employee it seems that these often painful processes are a waste of time.


What can be done about this?

The thing I want to make clear is that I don’t think that feedback and review of performance in the work place is worthless.In fact, I think it is really important.But why do we wait to formalize this to one to two times per year?I don’t know about you, but I like getting feedback in real time, not just during an annual review.With Millennials filling the work place, leaders will have to recognize that we crave frequent feedback (see here).One shouldn’t have to wait to fill out some standardized, one-size fits all, questionnaire about your performance that may or may not relate to your goals, projects and teamwork.

So, what can one do instead?After doing some reading about this, I feel there are a couple key things that could be done to upgrade performance reviews.

Do away with the annual review:why does it have to be annual?The use of regular feedback from both the employee and leader should be done.Use of platforms like 15Five utilize technology for weekly feedback that is easy and efficient.

Get peer feedback regularly:It seems that the annual review focuses mainly on the the leader and employee’s perceptions of their performance.Getting peer feedback regularly can be a a great way to make sure everyone is on the same page.Platforms like slack can assist with peer-to-peer communication.

Compensation changes should not only occur annually:Why wait to reward someone for the work they have done?Employers should have a reward system in place for certain metrics that are regularly measured in the work place (i.e. bonuses or pay increases).

Performance review is important, but it shouldn’t be overly complicated and done annually or semi-annually.By tweaking the systems that you may be using may actually improve performance and overall effectiveness in the workplace.

Let’s do everyone a favor and do away with the annual performance review.


Mark Shepherd

Mark is a physical therapist with nine years of experience. He is dedicated to helping students become the best clinicians they can be and is a firm believer that residency and fellowship offer critical mentorship opportunities for young clinicians. Current Roles: Program Director, Fellowship in Orthopaedic Manual Physical Therapy, Bellin College Program Coordinator, Evidence In...

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