The future of employee reviews is not looking good

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Ideally, workplace evaluations supply employees with a shortlist of weaknesses to correct and outcomes to aspire towards. They typically occur on a yearly basis or in correspondence with fiscal quarters.

It’s an old managerial procedure—established back when the standard of living was cheaper and post-war shortages were still urging a generation to privilege suburban life over the smog and noise that tails affluence.

Back then, a performance review only had the potential to justify or discredit buying a “tube” for the bedroom. Today, the decades-old practice seems to disturb something existential in the average worker. Marriage rates are on the decline. As are birth rates and religion. None of these are bad things but each of them elevates the significance of our employer’s approval. Our place in corporate purgatory.

Adobe recently published a study conducted on 1,500 American workers and managers that focuses on this point. In it, the authors revealed that the majority of the workforce rejects the utility of performance reviews; with 60% saying they do not meaningfully contribute to professional growth while an even greater majority described them as intensely upsetting experiences.

The report went on to show that more than half of US workers believe that reviews pit them against their colleagues and an additional 61% contend that their employer keeps two separate scorecards.

Twenty-percent added that they have quit jobs due to excessive employee evaluations and a comparable figure actively seeks positions at organizations that don’t do them at all. On balance, employers dedicate 17 hours to ranking their workers only for the latter to harbor resentment.

In fairness, nearly 40% of the managers surveyed in the new report hope that workplace reviews are abolished in the near future.

In a recent Gallup Poll, only 14% of employees featured could say that their performance reviews inspire them to improve.

It’s an outmoded system that’s very easy to weaponize in a post-pandmic job market.

Americans are uniquely ill-positioned to challenge arguments against higher wags at the present. When they’re not working excessive hours, mulling over an exodus, or convincing themselves that normal is just around the corner, they’re treated to an apocalyptic news cycle ensuring them that their current job will likely be their last. Securing high marks from their directors concurrently allows them to ignore any indication that the projected tide of unemployment will gobble them up with the other workers who weren’t strong enough to keep their heads above water.

The thing is, it’s basically impossible to address the totality of a worker’s contribution to a company in one conversation.

Robert Sutton, who is a Professor of Management Science & Engineering at Stanford, and Ben Wigert, a Director of Research and Strategy at Gallup, explained in a dissertation on workplace reviews: “The reasons for this are many. First, odds are the manager hasn’t been giving employees regular feedback. So, by the time the employee is hearing praise or correction, the issues are history — they have either been resolved or are in the distant past. The result is that it feels like an unnecessary rehashing of a painful time or praise that comes far too late — an afterthought.”

The two are in agreement that employee reviews do much more harm than good, especially in light of the abundant literature on career-related stress and early death.

The US is already the most overworked nation in the world. Eighty-five percent of men and 66% of women clock more than 40 hours per week. This has been true for some time. Still, the average productivity per American worker has increased 400% since 1950.

After unions dissolved, performance became the most influential factor with respect to employee retention.

“We love money, we want more of it, and we think money can buy happiness. And the more we work, the more we get paid,” financial commentator, G.E Miller explained.

“It’s been drilled in our heads that we are lazy compared to emerging market counterpart workers in India, Mexico, China, and other parts of Asia. Who isn’t? And what is our mental image of the work environments in those locales? To validate those fears, our jobs are being outsourced to cheap labor in those countries. In reality, the U.S. trails only Norway and Luxembourg (2 tiny countries) productivity per person.”

While it’s true that constructive dialogue is an important component of a healthy employer-staff relationship, a common objective may be just as important except it’s a criminally under-represented part of the equation. If employers make it clear that their victories facilitate victories for every member of their staff, workers will be incentivized to improve their output.

Instead, employee reviews serve as a Potemkin village for managerial oppression, or as financial journalist, Michael Lewis phrased it: “The bosses rightly cared far more about how much money we squeezed from our customers than how much time we spent squeezing.”

“It is not the best system for determining pay and promotion. And it costs organizations a lot of money — as much as $2.4 million to $35 million a year in lost working hours for an organization of 10,000 employees to take part in performance evaluations — with very little to show for it. Performance evaluations are an imperfect tool that only captures snippets of information. They communicate what is and is not important for employees to do — for better or worse,” Sutton and Wigert concluded.

Below, please consider the alternative approach to evaluation reviews initially featured in the paper they co-authored which is linked above.

  • Create a continual learning environment that encourages employees to openly collaborate.
  • Ensure workers are not held captive by their performance management system, tools, and metrics.
  • Listen and focus on a level of individualized development that can only be achieved by a deep familiarity with employees’ strengths and aspirations.