June 15, 2021
Performance Management 03 May 2018
Four Metrics to Replace the Annual Employee Review Forever
Technology Advice

Most employees and managers agree: pretty much no one looks forward to annual employee performance reviews!

And while performance management best practices are continually evolving, the way we manage our teams has not quite caught up. In fact, many business leaders today still depend on antiquated management practices that are no longer effective (or enjoyable). 

Successful companies today can no longer count on the most significant dialogue between supervisors and staff members occurring only once a year. In general, traditional reviews focus on individual work and neglect to consider that today’s companies collaborate as teams more and more.

According to a recent survey by MRA-The Management Association, approximately 42 percent of employers were “moving toward or considering” a more continuous employee feedback system versus continuing the old-school annual review system.

As the fast-paced workforce continues to become more complex, it is important to adjust management strategies to survive and remain competitive in the market. And having one primary review each year does not allow management to fairly assess the overall quality of a team member’s work or communicate effectively when corrections can save a project.

So, how should frustrated employees and management teams proceed?

Improving the Process

There are a variety of metrics that you can incorporate into your organizational strategy when it comes to tracking how your team members are performing. Keep in mind, the most effective ones depend on your business and different employees’ roles. 

Some forward-thinking industry pros believe that traditional metrics – such as productivity – can present a moving target and often be misleading. Instead, they suggest honing in on unique, standout qualities – such as relationship building tendencies – that are worth their weight in gold and should not be ignored.

Here are four metrics you should consider when measuring your team members’ overall performance:

1. Helpfulness. 

Helpfulness is a key performance metric at many companies today. This trait is vital for fostering a culture of teamwork company-wide and allows your team to perform better when approaching and solving complex tasks as a group. This doesn’t have to mean formal training or even lending a hand to clean up the shared kitchen. 

Look for the types of helpfulness that often go under the radar: reaching out to other teams to offer assistance, taking time out of normal duties to mentor or explain technical tasks to other team members, or even signing up for difficult projects.

Helpfulness is a qualitative metric, but there are ways to track it. Use pulse surveys to get employees to self-report times they have helped their teammates or solicit feedback with questions like “who has helped you this week?” or “who would you like to thank for going the extra mile?” Managers can also keep track within their project management software of the number of projects assigned vs. the number of projects the employees volunteer for. 

2. Initiative. 

One quality that makes some team members outshine others involves taking initiative. For instance, do you have certain employees who ask what’s needed and where they can help? An employee that takes initiative shows team satisfaction and engagement. 

This aspect is also important with regards to growing your company, especially if it’s a rapidly changing workplace that requires team members who can quickly adapt and be proactive.Similar to helpfulness, an initiative can be hard to quantify. Use your project and performance management tools to track the kinds of projects your employees sign up for and complete. Urge employees to self-report side projects that they complete for other departments and teams, logging these and the number of hours they spend on them in their pulse survey or project management tools. Try tagging these projects in your tools to ensure you can run a report.

3. Efficiency. 

Obviously, your team members need to be able to complete their work on time. They should not only have a firm grasp on time and resource limitations, but they also should know how to get their work done efficiently. Red flags in this area include missed deadlines or work that suffers from last-minute scrambling to meet a deadline. It is important to realize that attendance is key in this category, too. For example, if you notice that an employee is logging substantial amounts of overtime, you may need to talk to them about enhancing time management.

Time tracking tools can feel like a business version of Big Brother, but they really pay off when evaluating individual efficiency. Have team members track the hours they work on projects and individual tasks with a time tracking software, and go over the reports in weekly 1:1 sessions. If the employee spends too much time on one task, discuss strategies for improving focus and efficiency. 

4. Work Quality. 

While work quality is one of the most important metrics you can measure, it is also one of the most challenging areas to define. Employees that care about what they do and are fully engaged at work will likely perform better. However, productivity and output are more complicated than simply looking at the number of sales calls or the number of e-newsletters delivered by the marketing automation softwareFor example, how many meaningful connections did a team member make with new leads? Or, how much of your company’s content was viewed and shared by your audience? 

According to HR World, industry experts suggest measuring the amount of work that gets rejected – or needs to be redone – as a gauge for the quality of work, but obviously it is best to develop a strategy that suits your company best.

Kissing Annual Reviews Goodbye

When it comes to performance metrics and management, leaders today must understand that team members are humans and not just resources to be consumed. 

The key is to stress the importance of clear communication – from Day One – when measuring team member performance. Feedback on employee performance, development, and opportunities should be continuous throughout the calendar year.

New performance management is focusing on shorter-term goals and real-time, ongoing feedback, giving employees the tools to develop and evolve, instead of making them focus on past work. Do you think it is time to reevaluate your performance review processes?

Lisa C. Dunn is a writer for TechnologyAdvice and a freelance writer, copywriter, and ghostwriter who develops high-quality content for businesses and non-profit organizations. For over 20 years, she has worked with numerous PR and digital marketing agencies, and her work has been featured in well-known publications including Forbes, VentureBeat, Mashable, Huffington Post, Wired, B2C, USA Today, among others.