The changes that do us the most good are often those that are most difficult to make. At work, one habit that many companies can’t seem to shake is the traditional performance review. You know the one I’m talking about, the annual ritual that forces managers to give a limited amount of high marks to a certain percentage of employees and provide just enough feedback to justify another evaluation next year. All this process does is create tension for everyone at work.

In my over 20 years as a human resources manager with a wide variety of large global hi-tech organizations, I’ve identified four fatal flaws of this kind of performance evaluation process.

1) Put on your best poker face: The classic employee review is like a high stakes card game, but where everyone involved already knows how it’s going to end. If the person being reviewed is a top performer, there’s no reason to risk saying anything during the conversation that would endanger that hard fought for ‘5’. And if you’re labeled an ‘underperforming’ employee, you also have no incentive to open up and have a frank discussion with your manager. After reviews, people often feel that their supervisors did little more than dot the i’s and cross the t’s, no open and honest conversation was held. An effective review process is the foundation on which a culture that promotes dialogue and transparency is built.

2) Is your crystal ball broken? Old school evaluations focus on the present, which makes them terrible predictors of success in a new role. I recall a case in which one of the star coders was so productive that this person was promoted to Team Leader.The result was disastrous. Turns out that this employee was much happier working alone. All the promotion did was put him in a very uncomfortable situation, that of having to continuously communicate with team members. You need to be able to use a review process the way a fortune teller uses a crystal ball, to see the future. For an HR team, a powerful evaluation tool is one that provides the data that can give clues about the next phase in a person’s professional development. It can also detect signs of dissatisfaction and churn.

3) Water the plant: Without water a plant withers and eventually dies. At work, I’ve often seen people slowly lose their motivation, wilt away and linger on for years without leaving their jobs. This is so sad. Like all living things, people need to be constantly nurtured and cared for. We can’t expect an annual process to provide the support and encouragement people need to flourish. Managers should take an active interest in what their people are up to, both on a professional and personal level. The possibility for professional development is a major reason why talented, hard-working people choose to stay at work. Do you know what your people’s long-term aspirations are? If not, you really should. Otherwise, a competitor is likely to swoop in with a better offer and make their dreams come true.

4) Got the whole picture? Traditional evaluations focus on recent accomplishments. They’re not very good at providing a complete picture of a person’s behavior and performance. A more holistic approach to reviewing your people will give managers a better idea of how their team members are doing. Professional growth begins when a person is made aware of areas that need improvement, not just accomplishments. We also need to look at the whole team. Sorry, but individual employees can’t always get what they want. Like in an orchestra, every voice matters, but differently at different times.

So, what should your organization do now? You need to keep these four fatal flaws in mind, of course. But all of us HR experts need to remember the one golden rule of our profession: good performance management is measured by our ability to motivate our people. I have chosen a career in the HR world because in spite of all the challenges there’s no greater thrill than helping a good employee become great. All people want to soar, and great companies help their people reach their professional goals by inspiring, not pushing. If you can do that, your company will truly be future-proof.

The Performance Review’s Four Fatal Flaws - Dana-Goren-150x150.jpg

From Dana Goren

Dana is the Chief Customer Success Officer at bob. She brings over 20 years of experience in large global hi-tech organizations as a human resources manager. She has business partnership experience with senior executives and is recognized for her success in leading organizational development in global processes with a strong multi-culture mindset.