Five trends to look out for in performance management

With staff preferring to call in sick rather than face their annual performance review, it’s no surprise that companies such as Maybank, Accenture, IBM, Malaysia Airlines, and SAP have ditched the traditional annual performance reviews for a more ongoing process.

In fact, according to a survey by Wakefield Research and BetterWorks, pointed out that in the past year, a third of organisations have eliminated rankings and ratings, and over half have begun to implement a more frequent goal-setting process.

Surveying 500 HR executives, it further revealed that 99% of HR executives have committed to changing their performance management process. However, of that 99%, more than half (58%) have yet to start those changes.

As more HR leaders continue to overhaul their organisations’ performance management process, the survey pointed to five top trends happening simultaneously across today’s workforce.

#1 Increased spending on performance management systems

Almost four in five (79%) of HR executives plan to increase their spending on performance management processes in 2018 – and 43% expect to increase their budget by 10% or more.

#2 HR executives find flaws with annual reviews

When asked about the biggest flaws of the annual review process, the top response was that they cause too much tension and anxiety for employees and managers — and 41% believe they fail to actually improve employee performance at all.

#3 Continuous performance management transforms legacy HR

At organisations that have a CPM system in place, 85% of managers provide employees feedback quarterly or monthly. HR executives are using continuous performance management to transition from a legacy performance management process to an ongoing experience.

#4 Ongoing feedback is best practice for managing the younger generation

More than four in five (83%) respondents believe feedback that is provided regularly throughout an employee’s tenure is more important for younger generation employees than older generation employees. Similarly, most HR executives (90%) say that leveraging technology in the feedback and check-in process is crucial for successfully managing younger generation employees.

#5 Growing emphasis on rewarding for performance

Almost half (47%) of HR executives plan to increase spot bonuses, or bonuses given for exceptional work. As performance management becomes more continuous, managers gain visibility into who is performing beyond expectations and can recognise them accordingly.

“The survey results revealed a connection between the switch to regular, ongoing feedback and the movement many organisations are making to operationalise their workforce,” said Kris Duggan, CEO of BetterWorks. “The two go hand-in-hand. Performance management is surfacing important information—including performance data—allowing businesses to stay agile and make informed decisions to optimise employee recognition and performance.”


This article was first published in Human Resources and is reproduced with permission. Original article can be found at