Ten percent of Fortune 500 companies have eliminated their yearly performance reviews in favor of solutions that provide continuous, real-time feedback. Master of Ceremonies Carla Curtsinger examines the reasons behind the switch.
GE did it. Accenture did it. Deloitte, Gap and Medtronic did it too. And when Adobe announced they were doing it, their stock rose 68 percent according to an article in Forbes.
What did these high-profile companies all do? They abandoned their yearly performance reviews in favor of solutions that provide continuous, real-time feedback. And they’re not alone.
According to the Institute for Corporate Productivity, a research network that studies management practices, nearly 10 percent of Fortune 500 companies have eliminated this annual employee report…and for good reason.
The biggest is technology. Now more than ever before, there is an enormous amount of real-time data available to managers for tracking employee performance.
Not too far behind is the time required to complete yearly performance reviews.
A recent survey by the corporate executive board, or CEB, revealed managers spend an average of 210 hours each year on reviews…and employees spend 40 hours a year.
And it may be even harder to justify the investment when you consider this – 77 percent of those same HR professionals said the performance reviews did not accurately reflect employees’ business results.
Another reason cited for abandoning the annual report was the rapid pace of business. Objectives may change two to three times over the course of a year. So real-time reporting solutions are better able to capture the ever-changing workplace.
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