Home Thinking Aloud Why Active Management Will Prevail Over The Annual Performance Review

Why Active Management Will Prevail Over The Annual Performance Review


by Ty Tucker, CEO of REV


The annual performance review is quickly becoming a thing of the past. With companies like Adobe, GE, Microsoft and Netflix completely ending the practice, it is without a doubt that others will begin to follow. Cost, time and effectiveness are all reasons why this business staple is fading. However, the most significant reason is that the annual performance review is simply unable to sustain, measure, or improve employee productivity in the workplace in a way that is effective or engaging for employees.

While a yearly check-in with employees might be useful in the moment, a 20-minute conversation is unlikely to keep employees motivated all year long. Checking in with top management just once a year to discuss performance and trajectory within the company causes many employees to quickly lose sight of company strategy and personal goals. When you have unmotivated employees, the company will suffer with a decrease in productivity across the board.

Specifically, Millennials aren’t usually motivated by the concept of an annual review. With this generation making up more than a third of the workforce, these employees seek immediate feedback on their personal development within a company. On average, a Millennial will spend less than two years at a job due to a lack of engagement. To retain these employees, companies need to break free from the annual review model which fails to inspire them to do their best work. By moving away from this “way we’ve always done it” trend, organizations will take a big step in inspiring employee growth and performance, leading to overall company success.

So what are companies doing to replace the annual review? The answer is active management. With tools that provide constant feedback to employees in real-time, businesses are realizing that they can easily keep their staff on track and reaching goals quicker than ever before. One example of such technology is the performance management platform, which provides consistent, data-driven feedback that bridges the gap between management and employees in an assortment of ways.

Employers that take an active approach to management are better able to acknowledge great work through engaging tools like leaderboards and user scorecards. These allow employees and managers alike to track office-wide performance through convenient web and mobile applications. These tools also spark friendly competition which pushes employees to work harder so they can come out on top.

Additionally, an active management approach provides managers with much-needed insight into areas where there is room for improvement. If a manager notices that an employee continuously underperforms each week, they can easily pinpoint the problem and begin conversations with that employee. By opening a line of communication, the employee can receive the help and attention her or she needs to succeed and reach their own personal goals.

By utilizing technology to provide employees with the continuous communication and feedback they crave, managers are effectively utilizing active management to surpass the dreaded annual review. Instead of relying on a closed-door meeting at the end of every year to motivate their employees, managers who communicate year-round will spark consistent employee productivity, retention and, most importantly, personal fulfillment.




As CEO of REV, Ty Tucker provides unmatched business services to a wide variety of clients, including Pandera, Watsco, ShelfGenie and East Coast Metal Distributors. With experience in growing organizations from two employees to 340,000, Tucker believes that the perfect blend of active management, business intelligence and advanced analytics are the key to increased productivity.