Ditch the Annual Review: The Coach Approach to Performance Management
10/04/2020

Corry
Robertson

game pieces sitting on blocks at different heights

Ditch the annual review: The coach approach to performance management

The annual performance review is about as effective as the command and control leadership style that went out with the black and white tv.

We all know the review is a meeting between a manager and employee to evaluate an employee’s performance on the job over the past year or 6 months. 

The manager is supposed to point out what is going well and where there’s room for improvement. The session is supposed to lay out goals for the year ahead and discuss the employees opportunities within the company. 

This annual event is often dreaded by the employee and manager alike – but why?

In a world where the time budget is often as precious as the financial one, managers just don’t have enough time to give the review process the focus, thought and time it takes to do them justice – and the employees know it.

This means that the employee won’t be receptive to the feedback and won’t fully buy in if they disagree with what the manager is saying or how it’s being said.

employee review sheet

Annual Reviews Are Not Enough

Reviews are also often ineffective because they are only done annually.

One meeting isn’t enough time to assess and provide effective feedback for a full year’s worth of work and yet raises, bonuses, and promotions often hinge on them. 

It’s almost impossible to remember what happened even a few weeks ago, let alone several months ago so managers will focus on the most recent events or the few that stand out the most… then they will fill in the blanks with foggy recollections. 

This opens up the possibility that the employee will argue with the manager when they disagree on what happened.

woman upset at desk

My experience with reviews has been…mixed, to say the least

Before I started my business, like most of us I was an employee and I remember one review where my manager tried to provide me with some constructive criticism. 

Her comment took me off guard and in trying to understand what she was trying to tell me, I asked her to give me some examples so that I could better understand what she wanted me to correct. She replied:

“I knew you were going to ask me that. No. I don’t have any examples. I can’t remember the details. You are just going to have to think about what I‘m telling you and catch yourself before you do it again.”

Okaaaaay, I thought. Well, that didn’t help at all. 

In another company my boss took time in the review to ask me if there was anything that I wanted to share.  I confided that one of the senior executives was being verbally abusive towards me. He replied:

“Don’t take her on. You will lose. End of conversation”

The worst part is… He was the VP and GM of Canadian Operations and she reported to him as well. He just didn’t have the leadership to stand up to her. Great. Thanks for nothing.

You know, I can’t make this stuff up. Experiences like these happen all the time and cause employees to lose respect in the manager’s ability to lead and upper management’s ability to oversee its leaders. It causes a lack of trust, low engagement, and high turnover.

To be fair to these managers who were conducting the review so badly, they were young, inexperienced and untrained in leadership and so were not equipped to serve as managers. 

They were promoted to management roles because they were technically good at their previous jobs and the company needed to layer in a level of managers to handle the boom growth the company was enjoying.

It was assumed that because they had the technical skills to advance that they would naturally have the leadership skill to manage others. 

But that just wasn’t true. Both of those companies had to close their doors after only a few short years of enjoying a robust growth spurt.

boss reprimanding employees

Companies are negatively impacted by poor leaders

It’s like death by a thousand cuts. It’s not just the big obvious mistakes that managers make that cause employees to disengage. It’s also the little comments that are hard to pin down but leave the employee feeling unsafe that leaders need to pay attention to.

Leaders giving annual performance reviews have good intentions, and usually, they are trying to achieve positive results.  They want to:

  • Express appreciation, provide praise, give rewards
  • Make corrections, provide constructive feedback
  • Evaluate the results of the past and set new goals
  • Discuss employee advancement and growth
  • Keep formal records

But because the annual employee performance review is so dreaded due to the time they take coupled with their ineffectiveness, many companies have dropped it altogether.

This has left a void. Now those companies have no process in place for achieving the points above. 

Ditching the performance review should not mean ditching performance management. There is an alternative.

employee receiving review by boss

Performance Review vs. Performance Management

More and more companies no longer have an annual review and are moving toward a coaching approach to performance management.

So, what exactly is Performance Management and why should we do it?

According to a glossary of HR terms published by Bamboo, Glossary of Human Resources Management and Employee Benefit Terms

“Performance management is the process or system by which an organization measures and improves performance within its workforce. An organization may use performance management to monitor performance on an organizational level, a departmental or team level, and an individual level, although the term most commonly refers to individual performance. Common elements of a performance management system include:

  • Manager one-on-ones
  • Peer feedback
  • Performance improvement plans
  • Goal-setting and tracking
  • Rewards and recognition programs
  • Tracking progress
  • Reporting results to higher management
coach mentori

Why Use Coaching for Performance Management?

A Gallup study revealed that employees whose managers regularly communicate with them are nearly three times more engaged than those with managers who don’t communicate regularly. The benefits related to frequent feedback, goal setting, and growth opportunities far outweigh the value of an annual review.

The coaching approach, in its very essence, allows the manager and employee to work closely together by keeping the channels of communication open all of the time, not just during the annual review meeting. 

Through coaching conversations, the manager and employee can make small adjustments over time to ensure that micro-goals are being achieved that lead up to achieving company objectives.

The most effective way to actually help develop employees is to give regular feedback all year, as a frequent habit rather than an occasional event. But that feedback has to be attached to something relevant.

As I have written about many times, a company must be clear on its Purpose, Vision and Mission and employees must be able to make the connection between their contribution and company success.

process strategy steps business

A Step By Step Process for Performance Management Using Coaching

Here’s a walk through of the process I use to help organizations create cultures that promote performance, using coaching as a leadership style for performance management.

Step 1
The Town Hall

Following your company’s annual strategic planning session, the CEO should present the new goals and objectives to your entire workforce at one festive event like a town hall.

Make sure all of the employees are invited. Employees should hear high level messages from their CEO and leadership team. This ensures that there is no room for misunderstandings or rumors.

In the era of COVID 19, this event can take place online. If it takes place in person, please respect safety measures such as physical distancing, mask-wearing, hand washing and other recommendations of your region.

Step 2
Manager Meetings

Next, have your managers call team meetings to debrief your presentation. While the high level goals, objectives and initiatives should be heard from the CEO, how this will affect the workers should be heard from their manager. 

Managers should reiterate and reinforce the CEO’s message, then break down the role each team member is expected to play in achieving the goals. 

Step 3
One on One Agenda

By now, the strategic objectives are clear and everyone on the team knows their role (and each other’s role) in achieving them. Now is the time for managers to have a one on one with each team member in private.

Here’s what those meetings should include:

1 – Goals

The employee and manager should co-create SMART Goals so that their anticipated achievements align to the company objective and make sure they both connect all of the dots. 

In addition to tasks or projects that need to be done, be sure to include goals to hold the employee accountable to maintaining the company culture, such as how they behave, talk to others etc.

To do this with maximum impact, design a customized goal planner and conversation guide that suits the needs of your company, keeps the methodology consistent throughout the company and allows you to keep records.

Not sure where to start?  Book a call with me and we can get you on the right path.

2 – Learning and Development

Be open and frank in evaluating their learning and development needs to ensure that they are well equipped to deliver. Always provide winning conditions!

3 – Career Objectives

To be engaged, the employee needs to see how their individual contribution leads to high level success. The one on one should include time to discuss the employee’s career objectives to make sure that they see the connection between how the current role serves as an important stepping stone for future advancement.

4 – Rewards and Consequences

This meeting is also the time to discuss rewards, compensation and consequences.  As you cycle through this process year after year, there will be no ambiguity because you track results based on whether or not the goals were achieved.

Step 4
Follow up and Through

Managers should follow up with their direct reports using the coaching approach to performance management. This means using coaching as a leadership style where they make it a point to regularly coach their employees to achieve their SMART  goals.

How often? Semi-annually? Quarterly? Monthly? Weekly, daily? 

Well, that depends on the manager, the employee and what needs to get done.  We call this framework “situational leadership”.

woman happy shaking coworkers hand

The Situational Leadership Model 

Situational Leadership acknowledges that people have varying levels of competence and motivation for any given task and so it’s the manager’s responsibility to know where each of their directs lands and then adjust their leadership style to the situation, thus, situational leadership.

But what does that really look like?  Here are some examples of different situations to explain:

High Motivation Low Competence: The employee is keen to take on the task but does not have the skills, knowledge or experience to do a good job so they need training and supervision to catch errors, not extra encouragement.

High Competence Low Motivation: The employee knows how to do the task but does not want to so they need extra encouragement but no new training. Supervision will be to ensure the job is getting done.

Low Competence, Low Motivation: The employee does not have the skill to complete the task and does not want to do it either. The employee needs both training and encouragement.  Depending on the employee’s attitude and track record, this could be a very high maintenance situation for a manager and removing the employee from the task may be considered.

High Competence, High Motivation: The employee knows how to do a good job and they want to do it. Although in many ways this is the ideal situation for both employee and manager, don’t just cut them loose and let them fend for themself, no matter how tempting that may be. This situation brings with it a big blind spot caused by overconfidence on both sides. Communication still needs to occur to ensure that the task or project is being completed correctly, on time and on budget.

Situational Leadership Includes Timing

You can be coaching the same person and still require different situations, different cadence, different timing.

The coach approach to delegation and workload management includes agreeing to when you will trackback with each other to discuss the progress of the SMART goal. 

Without agreeing to the timing of these check in conversations you run the risk of being perceived as a micro manager or a dumper.

Step 5
Repeat. Repeat!

As you cycle through this process year after year, there will be no ambiguity around measuring results or evaluating performance because the coaching approach to performance management establishes the agreements between the manager and the employee that can easily and clearly track. 

Success will be measured based on whether or not the goals were achieved and expectations met.

Employees should have a voice. Instead of the employee passively listening to the manager’s observation about their performance, let your employees make a presentation to the manager instead. Because of the closeness of the coach approach, the manager already knows what goals were met and which were not.

The presentation format should include talking points such as what lessons were learned, and how they grew and improved. They could discuss what is better about their performance since last year, what they are proud of, and what they are ready for next.

staff meeting

Conclusion

Are you tempted to roll your eyes at me and scoff that you don’t have time to coach? 

I can tell you from my years of experience helping organizations move to this model that the coaching conversation is not a longer one – it’s a better one.

Coaching for performance management saves time because it eliminates the wasted time, emotional drain and energy drag caused by the traditional annual review.

It saves time because it transforms conversations to ones that are productive, effective and create harmony.

It saves time because it improves the relationship between the manager and employee thus increasing trust.

Here’s the truth – what you DON’T have time for is:

  • Cleaning up messes after mistakes have been made and the *bleep* hits the fan.
  • Deja Vu: Being asked the same questions over and over and giving the same answers again and again with no progress.
  • Putting out fires when miscommunication causes misunderstandings that lead to sparks flying.
  • Smoothing over conflict after situations have escalated beyond control. And good luck with that by the way… It takes ages, effort, and precious, precious time to repair serious damage in relationships caused by conflict that erupted after festering for too long. 
  • Attracting new customers after the ones you have storm away because they got fed up with your employees who failed to deliver on service and quality expectations.
  • Recruiting new employees for your revolving door situation because your managers lack the coaching skills they need to engage or retain them.

Every leader has a time budget – there’s only so much of it to go around. Companies who excel and outperform the competition ditch the performance review and bring in performance management using the coach approach.

Coaching as a leadership style is streaming into companies like fresh air through an open window for a darn good reason. 

Because it works.

Did you enjoy this article?  Here are a few others you might enjoy:

A Peek Inside a Successful Leadership Development Program

Employee Engagement Strategies – A 3-Part Series

Organizational Culture:  What it is, why it’s important, and how you can use it to outperform the competition

7 Hidden Pitfalls in your Leadership Development Program

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7 Hidden Pitfalls in your Leadership Development Program – And how to avoid them

Author:  Corry Robertson

Sought-after tech industry culture expert, Corry Robertson has been helping leaders turbocharge employee retention and performance for over 20 years.

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