The Problem with Year-End Reviews and How to Make Your Process Better


While your employees are one of your greatest assets, they are also a source of anxiety and even risk. Keeping your workforce motivated, productive, and focused can be challenging. If your company does not evolve beyond the performance management techniques of yesteryear, then the task is even more daunting.

The traditional approach to year-end reviews is largely antiquated. Often, they do not provide meaningful results and may even hinder your managers and employees. If you have not considered updating your process, here is why you should.

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The Problem with Year-End Reviews

The annual review approach actually comes with a number of shortcomings. Some of these impact your managers while others affect the workers who are being reviewed. By sticking with the old approach, you could be hindering performance.

Year-end reviews are stressful not just for the workers, but for your managers as well. Anxiety comes with the territory, mainly because so much weight is put on this one conversation. As a result, they are rarely drivers for positive change, even if the information being shared is valid.

Additionally, the subjective nature of annual reviews allows bias, conscious or otherwise, to enter the process. When that occurs, or is even perceived to have happened, an employee may disregard all of the manager’s input. Similarly, a worker may receive an unfair assessment, harming their future and potentially damaging retention if the feedback is genuinely undeserved.

While the intended outcomes of year-end reviews are to pinpoint areas of improvement, establish goals and celebrate successes, the process often misses the mark. Since the reviews are infrequent, employees do not receive the direction they need at the times it matters most. Further, critical points may be missed merely because the incident was not on the manager’s mind when it was written. The feedback itself often lacks quality as well, being either untimely or unactionable.

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How to Make Your Performance Management Process Better

If you want to improve your performance management process, you need to focus on a continuous approach over an annual review. Constructive feedback needs to be provided at the proper moment, such as when a problem is occurring, or a result was below the standard. Additionally, it needs to serve as guidance, being highly actionable and aligned with larger goals.

With this approach, managers begin to function as coaches. They can steer their employees more effectively, keeping everyone on the right path. Plus, it can improve overall performance by allowing managers to intervene as soon as feedback makes sense.

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