Free Business Planning Webinar:

AI and Your Plan Register Now

But Can You Run a Company Without Performance Reviews?

In my years in business I’ve seen performance reviews from several angles, good and bad. As my employee numbers grew past a handful to several dozen, the reviews seemed more necessary than they were when we were smaller.

One of my earlier employees took the job offer only on the condition of two reviews per year.

But I was never comfortable with them. My management style was working shoulder to shoulder with the people, when we were a smaller team. It was hard to suddenly get into a boss-subordinate mode and deliver a report card.

The people who worked for me would tell you, I often put it off, and I didn’t do that good a job when I did it.

On the other hand, people need and want reviews because they want to have some sense of how they’re doing. And as your company grows, it needs management too, as well as leadership. And reviews help people keep on track.

I caught an interesting post called Should Performance Reviews Live — or Die? posted by the Summers Hospitality Group earlier this week. It’s a good post on an interesting topic, listing some common problems with performance reviews, some advantages, and the predicable conclusion: it depends.

The disadvantages I relate to best to are the focus on what went wrong, the link to pay, and that they happen on an annual basis. They list others as well.

The advantages they cite are are accurate: the whole idea of feedback, consistency, keeping an organization focused on performance, and several other good ones. .

One thing that seems to work better than the formal reviews is a good management system identifying external, measurable, metrics for an employee and then watching those metrics together. I mean like calls, sales, expenses, emails sent, click through or conversion rate, subscribers, posts, tweets … a number we could watch together. When I was able to get that kind of system going, instead of the formal review, it ended up meaning regular collaboration. There was a visible objective metric and doing better or worse than planned led to discussion, and collaboration, without the stiff formality of a report card.


  • Tim McEneny says:

    Tim…..In my very first job out of college, I was as an Industrial Engineer at IBM in upstate NY. My boss used to tell me that you could improve a direct employee’s performance by at least 10% simply by measuring the employee’s output and comparing it to a time standard (established by yours truly). He was right, and I found that establishing quantitative measurements can help manage white collar employee performance as well (provided the goals are achievable and visable ). Stretch goals are ok if the process of achieving them is understood by manager and employee.

  • Susan Saldibar says:

    Tim, good article on a subject often overlooked. There really is no way to get around performance reviews. I have a similar management style to yours and have always found them to be stiff and overly formal. However, that is probably a good thing. It does a few things: 1) reminds all involved that objectively measuring performance is good, 2) that management assumes the leadership role and takes it seriously and 3) it is an outlet for dialog that might otherwise not occur. I really think a quarterly review is a good thing; keeps the wheels greased and communication open. Thanks for this, Tim. Very helpful!

Leave a Reply

Your email address will not be published. Required fields are marked *