Continuous performance management
The traditional annual review is being replaced in a number of organisations by continuous feedback throughout the year.
Many companies including Adobe, GE, Deloitte and Goldman Sachs are emphasising continuous feedback. This could be from colleagues after significant internal and external meetings, from their immediate manager or others in the organisation who interface with them.
More regular discussions with their immediate manager may occur monthly and/or quarterly.
For some organisations the annual review has traditionally been linked to conversations around bonus payments as well as development. It is now recommended that conversations around development plans are separated from those around compensation to ensure the development conversation remains focused and given 100% attention.
An associated debate is around grading people either numerically or descriptively. If standards of performance are adequately described, understood and used consistently then either system should not create undue problems. After all the numeric systems are based on descriptions for each level.
Ultimately there will always be a degree of flexing when dividing and delivering a bonus pool. It is not a science, but an art informed by appropriate data.