The Value of Performance Reviews - SelfStir | 360 degree feedback software
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Goodbye annual performance reviews, hello feedback

In this mini blog series we explore the value of performance reviews, the bucking trend against them and why on-going feedback and coaching is the new era of performance management.

We also have a white paper that explores the topic in further depth which you can download here.

The value of performance reviews

If you believe people add value in an organisation (which we do!) then there must be a way to measure it. At an organisational level, you can look at metrics such as Human Capital Return on Investment, productivity, revenue, expense and income factors. Performance reviews play a central role in drawing everything together from performance management to reward, L&D and organisation development, with which you can begin to look at the value people add to organisations.

At an individual level, the targets and objectives drawn from performance reviews enable line managers to manage and measure employee performance. Performance reviews should help employees understand the expectations their organisation has of them regarding performance, and provide a forum for skills development and accountability.

Individual performance is central to both day-to-day and strategic people management. For an organisation to achieve its strategic objectives, it is important that line managers regularly monitor progress, as aligned and integrated into business operations on a day-to-day basis. Starting with the end goal in mind provides the individual, team and line manager with a measure of success and the ability to know whether progress is on track.
If people don’t know where they have been and they don’t know where they are going, then they cannot be sure of whether what they are doing is the right thing or not.

Performance reviews are used for two reasons:

  • Developmental – to help identify areas of performance, personal development and career planning to work on.
  • Administrative – to inform decisions regarding reward, career development, termination and dismissal.

What’s gone wrong?

Research into performance reviews has been available since the early 1920s and there is plenty of evidence that shows a link between performance management practices and improving performance. Yet there has been a backlash from organisations, with reports that annual performance reviews are being ditched. The reasons given are various and familiar, with common complaints including:

  • The process didn’t achieve its goals and the system was flawed
  • Too much focus on process over outcomes
  • Managers are dissatisfied
  • The reviews don’t yield accurate information
  • Employees are left feeling negative
  • Triggers employee disengagement
  • Constrains openness to creativity and growth

Read the next part of this mini blog series – The extinction of annual performance reviews


In recognising the importance of focussing on an individual’s growth in their job, shifting away from the annual review structure of out-dated objectives, SelfStir developed a platform accessible to people in across all levels of businesses, where they can drive their own development, be that personal or career, and get multi-rater feedback to aid their progress.

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2 Responses to The Value of Performance Reviews
  1. […] performance management best practice. The common complaints list is growing, as shared in the previous part of this mini blog series, and so the annual performance review is facing extinction. In this post we’re exploring the […]

  2. […] this mini blog series we explore the value of performance reviews, the bucking trend against them and why on-going feedback and coaching is the new era of […]

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