Performance appraisals – more pain than gain?

"We're not sure that spending all that time in performance management has been yielding such a great outcome." So said Pierre Nanterme, the head of Accenture, as the firm announced it is ditching performance reviews and rankings for all of its 330,000 employees from September this year. It follows a similar recent decision by Deloitte. The days of the traditional annual appraisal in professional services firms are starting to look numbered.

Of course, professional staff deserve constructive feedback on their performance, just as much as firms need fair and consistent ways of recognising and rewarding their best talent. But, I've long felt that the enormous time and effort spent in law firms on performance management processes brings limited value to individuals and has limited effect on raising performance levels.

At their best, performance appraisals are a chance for associates to receive honest feedback and to agree future objectives that enable them to develop their profession skills and experience. In reality, however, the value of performance discussions is diluted by complex processes that include evaluation against competencies, peer comparisons, performance ratings and forced normal distribution curves.

The overall results are often divisive and demotivating. In fact, research into brain activity has shown that even employees who get positive reviews experience negative effects from the process. The standardisation of performance management processes often triggers disengagement from associates, who are hoping for a more personally-tailored approach. The conformity required for the processes ends up constraining change, collaboration and creativity.

The rigidity of a performance management cycle where everyone participates in an appraisal discussion at the same time each year creates stress for partners and associates alike. Couple this with the fact that feedback received many months after an assignment is complete loses relevance and the opportunity for learning, and it's not surprising that firms are concluding that the effort simply doesn't justify the outcomes.

I, for one, would be delighted to see the worst aspects of a typical performance management cycle disappear. But, that doesn't mean they shouldn't be replaced with something better. A fundamental shift in the way partners interact with associates on a day-to-day basis is required if performance enhancement is to be meaningful. Looking back and evaluating past achievements on a comparative basis needs to be replaced with a focus on future personal development and career planning on an individually-tailored basis.

Feedback and debriefing can and should be integrated into each client meeting, draft document or completed assignment so that associates can learn continuously and apply what they've learnt to their daily work and behaviour. The concept of partners giving 'five-minute feedback' to every associate every day would go a long way to meeting associate expectations and improving performance in a timely fashion.

Partners need to make the time to discuss individuals' ambitions and goals openly with each of their associates to help them to make informed career decisions. The partners who take a personal interest in their associates, coaching them in technical and personal skills, and mentoring them to achieve career satisfaction, are the partners who build motivated teams and positive alumni. They don't need a performance management system to help them do it.

Jill King is a consultant and the former global HR director at Linklaters (www.jkinsights.co.uk)