It has been a very big couple of years for all of us, with workplaces disrupted and more people working remotely than ever before. I think that has real implications for the way we should be measuring and giving feedback on performance, and during performance reviews.

The ‘no surprises’ performance review

Let’s get one thing straight: the age of the traditional performance review, where an employer tells an employee whether they’re doing well (and hence whether they’re getting a pay rise), is over. Or at least it should be. I’ve always believed that if someone walks out of a review surprised by what was said to them, there’s a problem. And that goes for the manager as well as the employee. That’s because performance reviews should never be a once-off. They should be part of the ongoing, consistent way employers manage and engage with staff. Being a good manager is raising any feedback – positive or negative – at the time it’s relevant, preferably no later than at a weekly check-in. Most importantly, it also means ‘coaching’ your employees. This involves engaging in a two-way dialogue where you listen to their concerns and encourage them to speak up about their challenges and goals. There’s no need to save them up for one every six months, or once a year for a performance review.

Coaching in the time of COVID

A lot of employers already understand this but some have let coaching slide during the pandemic. Others have struggled to take it online. However, this really is when we need it most and technology has actually made it easier than ever to build a coaching culture in your organisation. Zoom, Google Hangouts and Microsoft teams let you meet with employees distraction-free whenever you need to. Moreover, the idea of people being away from the office actually makes it more important (and efficient) to schedule ongoing, regular catchups. By checking in and having regular catch-ups, you’re keeping people engaged with the workplace and their careers. That helps keep morale and productivity high and your business churning along. So if your team is working remotely or you’re running on the hybrid model, schedule a weekly half-hour meeting with every team member and ditch the big performance review. Use it to coach and guide them, keep them engaged and, most importantly, listen to their concerns and aspirations.

What to discuss when you’re coaching employees

Instead of using the performance review to hand out brickbats and bouquets, the coaching approach should centre on four big ideas:

1. Giving people leeway to make mistakes. Use your weekly catch up to find ways people can take on new challenges. Focus on productivity and give them the autonomy to do the task the way they want to (within reason, of course). Just make sure you also offer adequate support.

2. Taking calculated risks. Encourage people out of their comfort zones and stretch them. Just don’t push them beyond their capabilities.

3. Having honest conversations. If you’re not prepared to let them take on work they want to, or if you can’t address their concerns, let them know why.

4. Asking questions. Try to understand what motivates people and where they want to be in their careers. Inspiring and motivating people begins with understanding what makes them tick.

The benefits of the coaching approach vs performance reviews

Once you step beyond the traditional performance review model and move towards a coaching-based model, you’ll potentially open up so many benefits for your business, including:

1. Empowered employees

You’ll give employees the opportunity to align their work with their own private and professional goals. This is likely to mean they’re capable of taking on more responsibility as well as more complex challenges – something that has the potential to deliver real benefits to your business. It lets you set and review goals more frequently, giving your employees the opportunity to stretch themselves and build the skills they’ll need to advance their careers more quickly.

2. More accurate insights into employee performance

Coaching helps remove subconscious bias. As long as five years ago, McKinsey research revealed companies that have ditched the traditional performance review for the ongoing coaching model have access to a more rational, less subjective analysis of employee performance. This even includes automating many measures of performance that were traditionally undertaken through more subjective human assessment. It also includes using apps to collect exact data on how an employee performs.

“By getting rid of bureaucratic annual-review processes—and the behaviour related to them—companies can focus on getting much higher levels of performance out of many more of their employees,” McKinsey notes.

3. Better staff retention

A coaching-based approach lets employees have their ideas heard regularly. And that’s key to helping them know they’re a valued member of your team. Studies show that valued employees are also more likely to be more engaged and therefore more loyal employees – vital at a time when the war for talent is intensifying. Not only does that mean you’re more likely to hold onto key talent, but you’ll also incur less in staff turnover costs.

4. More efficient

Believe it or not, regular ongoing coaching will actually save you time and money compared with a traditional performance review. After all, you’ll cut down on all the unnecessary admin that comes with a performance appraisal.

Want more?

We have a wealth of experience helping businesses like yours build a coaching-based model into everything they do. If you’d like to know more, get in touch.