The Shift Towards Continuous Performance Reviews

Teams with continuous feedback programs show 23% higher profitability and 18% greater productivity than those relying on outdated annual performance reviews. AI ALPI research has uncovered a critical shift in top-performing HR departments. While 76% of organizations still rely on annual reviews, market leaders are leveraging technology-enabled continuous feedback loops that drive real business outcomes. → Weekly micro-feedback sessions are replacing quarterly or annual reviews, creating psychological safety and real-time course correction ↳ This approach reduces employee anxiety and creates 3x more actionable insights than traditional methods → AI-powered tools now enable performance tracking without the administrative burden ↳ HR leaders implementing these systems report 42% reduction in management time spent on performance administration → Human-centered leadership training has become a critical enabler ↳ Organizations investing in empathy-driven feedback skills see 37% higher retention rates among high performers Companies that implemented continuous feedback systems initially saw a temporary 15% drop in satisfaction as managers adjusted to more frequent, meaningful conversations. By month three, both engagement and productivity metrics surpassed previous levels by significant margins. 🔥 Want more breakdowns like this? Follow along for insights on: → Getting started with AI in HR teams → Scaling AI adoption across HR functions → Building AI competency in HR departments → Taking HR AI platforms to enterprise market → Developing HR AI products that solve real problems #ContinuousFeedback #HRTech #FutureOfWork #LeadershipDevelopment #PerformanceManagement

Maybe it’s time to start over One of the CEOs I’m coaching recently called me, exasperated. He’d just come out of another round of mid-year performance reviews. He described the ritual we all know too well: Goals set in January that everyone forgot by March. Feedback requests nobody wanted to give - or receive. Self-reviews that sounded like a mix of sales pitches and confessions. Calibration sessions behind closed doors where people who barely knew the work decided who was “exceeds,” “meets,” or “below.” Development plans destined to sit untouched in the HR system. “And then,” he said, “we all acted surprised that nothing has changed.” He paused. “Why are we still doing this?” It was the question that most leaders think but rarely voice. I asked him: “Do you believe this process is actually salvageable?” There was a long silence. “I don’t know,” he admitted. “We’ve tried everything - simplifying the form, shortening the cycle, training managers to be better coaches. It still feels broken.” Then he said something that made me sit up straight: “What if we just started over? Blow it up if we have to. Let’s build something that actually changes behavior, not just records it. Because honestly, when was the last time a performance review changed how you or I showed up the next day?” That’s when it clicked. This CEO didn’t care about performance reviews. He cared about performance. He cared about the conversations people actually need to have: The hard truths no one says out loud. The recognition people crave. The clarity on where they stand and how to grow. Making all their work visible - not just what someone remembers from last month. It’s about designing a performance culture where feedback is real-time, usable, and impactful, not an annual (or semi-annual) box-ticking exercise. So here’s my question for every leader reading this: Why do we keep pretending this broken system will suddenly start working? If you could start from scratch, what would you build instead? What if we designed something that: Made feedback an everyday habit, not an annual ritual. Valued growth as much as outcomes. Treated people like adults who want clarity, not just scores. Captured real-time data to truly see everyone’s impact. Tied pay to market value and role scope - instead of using flawed ratings to justify it. That CEO stopped tweaking around the edges. He’s building something new, and he’s given his HR team permission to rethink everything. It may be imperfect at first. But it will be built for how the business needs to excel. And that’s what matters in today's workplace - impact, not activity. If you’ve ever blown up your performance process, or even thought about it, I’d love to hear your story. Maybe this is the year we finally stop pretending that performance reviews actually drive performance.

Six-month performance reviews are broken. ❌ By the time feedback lands, it’s outdated. Managers can’t recall details. Employees leave frustrated. And in the AI era, six months is a lifetime. ⏳ That’s why Thomas Forstner (VP of People & Talent at Juro) rewired performance management with AI. The tipping point - believing that talent density was too important for the business to rely on "best practices" that weren't generating results. Instead of clunky review cycles and dreaded PIPs, Juro now runs: 🛢️ OILSmith → a custom GPT guiding managers through Juro’s OILS feedback framework (Observation, Impact, Listen, Suggestion). 🛠️ FutureSmith → AI-powered “futurespectives” that help managers and employees design roles for the next 6 months. ⚡ Slack nudges, Humaans automations, Zapier flows → performance as a continuous data stream. 📚 Notion as Org Brain → the living hub connecting all of it. The results? ✅ 300+ feedback conversations logged in 2 months ✅ Near 100% completion rate | 100+ hours saved ✅ 4.8 (out of 5) ChatGPT rating for OILSmith ✅ Early signals that PIPs can be eliminated entirely The bold takeaway: not every build has to be a super technical, vibe-coded platform! Sometimes, simple agentic workflows powered by GPT and first-principles thinking unlock the biggest wins. That’s why I’m thrilled to feature Thomas in the latest edition of How I Built It. 👉Read the full HIBI post in my Field Notes newsletter (link in comments) 👉Join our AMA with Thomas on Wed, Sept 10 (details below) Hope you can join us! Thomas will be sharing his full playbook. 🔥 #HowIBuiltIt #Huertanomics #AIforHR #PeopleOps #FutureOfWork

I stopped performing annual reviews. 99% of the time they don’t increase actual performance.  Give me 2 minutes. I'll show you what I did instead: 👇 𝗦𝗵𝗶𝗳𝘁 𝗬𝗼𝘂𝗿 𝗠𝗶𝗻𝗱𝘀𝗲𝘁 • Break free from traditional annual reviews. • Be a year-round coach, not a once-a-year judge. • Continuous feedback, like a sports coach, is key. 𝗔𝗹𝗶𝗴𝗻 𝗚𝗼𝗮𝗹𝘀 • Avoid misalignment with clear, measurable goals. • Limit to 3 major goals. • Employees set personal goals aligning with these. • Focus: 80% on these goals, 20% on everything else. 𝗠𝗮𝘅𝗶𝗺𝗶𝘇𝗲 𝟭𝘅𝟭 𝗠𝗲𝗲𝘁𝗶𝗻𝗴𝘀 • Essential for ongoing feedback. • Ideal timing: 60 minutes every two weeks. • Discuss progress on top 3 goals. • Address blockers & celebrate successes. 𝗜𝗺𝗽𝗹𝗲𝗺𝗲𝗻𝘁 𝗤𝘂𝗮𝗿𝘁𝗲𝗿𝗹𝘆 𝗖𝗵𝗲𝗰𝗸-𝗜𝗻𝘀 • Extend a regular 1x1 to 90 minutes quarterly. • Explore the employee’s broader career aspirations. • Discuss quarterly performance. • Checkin on personal development (see next) 𝗘𝗺𝗽𝗵𝗮𝘀𝗶𝘇𝗲 𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝗹 𝗗𝗲𝘃𝗲𝗹𝗼𝗽𝗺𝗲𝗻𝘁 • Traditional reviews list too many improvement areas. • Focus on ONE key area for yearly improvement. • Agree on the area together. • Review progress in quarterly sessions.    👇 𝗕𝗼𝗻𝘂𝘀 𝗧𝗶𝗽𝘀 For 𝗘𝗳𝗳𝗲𝗰𝘁𝗶𝘃𝗲 𝗣𝗲𝗿𝗳𝗼𝗿𝗺𝗮𝗻𝗰𝗲 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁: 1. Make every 1x1 a coaching opportunity. 2. Consistently give feedback or praise. 3. Avoid canceling 1x1s – they're crucial. 4. Repeated mistakes may indicate a poor fit. 5. Link bonuses to both company and individual goals (50/50 split). Ditch the bureaucracy and transform performance management into a tool for real feedback and personal growth! 📈 _____ Enjoy this? Repost to your network and follow me Scot Chisholm for more! 📌  P.S. I'm writing about how to delegate like a pro this Friday to all my newsletter subscribers. Sign up here: scotchisholm.com  

Interesting research from ADP posted in a WSJ article last week saying that 29% of employees in their workforce analysis quit one month after their first promotion. The main reason they found was that employees waited so long to get that promotion (many companies only do promotions once or twice a year) that they’ve already started looking for something new, and by the time the promotion finally happens, they’ve decided to leave. This doesn't surprise me after a couple of decades of working in the people space. Too many companies have such lengthy review and promotion processes that they don’t want to facilitate the process very often. However, if your process is too lengthy and affects your business practices and doing what’s in line with your people philosophies (pay for performance? Employee growth is important? recognition?), perhaps your process is broken. When you limit abilities to formally recognize & pay employees for their impacting contributions, a couple of things tend to happen: Employees start to look elsewhere You do something unnatural outside of a well-calibrated process and give more money or a promotion as a way to “save” the employee who will likely still quit in six months anyway, and you lose respect when it comes out Employees lose trust in their management & company at large Over the years, I’ve implemented quarterly promotion processes across various companies. Not being a fan of performance reviews and instead using tools for real-time feedback, my teams would work with me to figure out how to do talent planning across the organization (who is doing well/lower performers, who are ready for a move, what is our succession planning, do we have any single points of failure, and who is on track for a promotion). I've found having good descriptors in a thorough nine box can make these discussions much richer (performance on one axis, trajectory on the other) and the calibration much better over time. What’s key to being able to facilitate this quickly is having very thorough job architectures/frameworks (which give clarity to both employees and managers around expectations), clarity on business growth (or not) to understand the need for more senior employees, and less paperwork and more trust in decision-making with a budget. We can calibrate to look for biases, push to understand gaps in our talent org and have a broader discussion of what we need for the future. I don’t have any statistically significant data, but anecdotally, the leaders who didn’t want to spend time in quarterly (or twice a year) talent reviews to understand their talent better and set up a process/budget for quarterly promotions usually had higher attrition & lower engagement. If people are your top priority (let alone your highest cost), spending extra time understanding how they’re delivering toward our customer problems is important. https://lnkd.in/gmz4EPCh

Managers, how can you build trust with employees during performance appraisals? YOU CAN'T. In fact, your employee appraisal process creates the appraisal resentment and mistrust you’re trying to avoid! Approximately 90% of the tens of thousands of managers I've worked with globally tell me they don't do any pro-active, intentional observation (remote observation or in the field). In fact, a Forbes study reported that only 13% of employees agree that the performance reviews they receive inspire them to improve and wasn't a true indicator of performance. Granted, there are some industries, such as pharma, where intentional observation in the field is part of their sales culture. When I ask most companies how they evaluate performance, I hear, "I look at the data, activity and results." Then, stop calling it a PERFORMANCE review and call it what it is; a RESULT review. How can a manager review performance if they're not observing their people perform? And why is this only done once or twice a year? Assumptions are then made around WHAT they're doing in activity, and how they're doing things, based on their results. The cost is, bias, a negative work environment, ineffective, subjective guidance from the manager and the erosion of morale and trust. Here are six alternatives to the dreaded annual performance review: 1. Focus on accomplishments and goals to reinforce desired behavior. 2. Have more frequent reviews. Rather than one or two formal performance reviews a year, consistent coaching and feedback is the conduit to better performance and NEVER stops, making the reviews more valuable, relevant and personal. If the review comes as a shock to your employee, that's an indication of a lack of effective, consistent coaching and communication. 3. Get more input. Ask for feedback on you and your management style, and what they need most from you. The performance review goes both ways, which builds trust. 4. Replace formal review with casual feedback. This can only happen if your observing what they're doing. 5. Separate feedback from compensation. 6. Review the review. Assess with your employee the process, what they'd like to see improved or changed in the process, and how valuable it was. #performanceappraisal #management

Why don’t organizations place a greater emphasis on creating meaningful engagement in the workplace? Given the pivotal role that connection plays in fulfilling our fundamental human need for social interaction, I believe it’s warranted. Is there any ‘downside’ in doing something as simple as; regularly meeting with the people on your team, building relationships, discuss performance, and identify developmental needs? You know, being real with people, true engagement. Knowing and understanding your team is a "strategy execution principle." It’s importance spans well beyond effective team building and crosses over into on-the-job happiness, productivity, and belonging while also helping to drive your organization’s success. Sure, I agree that no one likes wasting time with useless gatherings; however, an every 30-day individual check-in or "progress meeting" can provide significant value for every manager and their direct reports. Taking the time to solely focus on an individual's performance and working to proactively understand their needs and develop their potential is a model for engagement with a high rate of return. Organizations that execute well make these meetings mandatory scheduling them with the expectation that they be held. I’m talking about an allocation of 45-60 minutes each month, using the time to listen to and focus on each team member.   These are not a series of monthly performance reviews, they are coaching, guiding, and leadership development sessions. The outcomes your organization receives from these efforts are three-fold: 1) You leaders grow by making a personal investment in the relationships they have with their people, 2) The space is being created for consistent conversations of consequence to occur, 3) You're guaranteeing that every team member knows their role and what is expected from them. This is where the execution occurs. Both parties build trust and respect, work collaboratively, and invest themselves in the success of the business. Believe it or not, this connection drives results. The organization gains a quality understanding of every team member's capabilities from each session. They know what each team member does best, who they work well with, and how to lead and challenge them. THIS IS NOT AN EXERCISE IN DOCUMENTING PERFORMANCE. It's about creating a partnership, based on mutual benefit, where two parties are committed to each other’s success. A bond is established that says when a team member fails at something, their leaders recognize they have also failed. They work together to improve. This is true engagement. "Is dedicating just 60 minutes each month to focus on your team's individual performance too high a price for a more engaged, happy, and productive workforce? Think about it. What commitment is your organization making for your team members? Your organization's success? #leadership #progress #employeeengagement #execution

what’s truly stopping a lot of organizations shifting from performance management to continuous feedback? ↪️ vulnerability- giving real-time feedback means managers can't hide behind the formality of annual reviews. it requires emotional intelligence and comfort with difficult conversations - skills that weren't traditionally prioritized in leadership development. ↪️ infrastructure- companies have built elaborate systems around annual cycles - compensation, promotions, development plans. shifting to continuous feedback means reimagining these foundational processes. it’s like trying to renovate a house while living in it ↪️ power dynamics: performance management maintains a clear hierarchy. continuous feedback demands a more democratic, transparent culture where feedback flows in all directions. that’s threatening to traditional power structures. the hard pill that not everyone wants to swallow: continuous feedback requires rewiring deeply ingrained organizational DNA. it’s not just about changing processes - it's about transforming how people interact daily. companies that succeed make three crucial moves: ↪️ they invest heavily in coaching skills at all levels ↪️ they celebrate and reward those who model the new behavior ↪️ they explicitly acknowledge that mistakes and course-corrections are part of the journey what’s your experience with this shift been?

I've always strived to understand how engaged my teams are in their mission, and what’s getting in their way that I or my leadership team can help remove. At previous companies, we used quarterly or semi-annual surveys. While they did surface issues, the format had limitations: Forced: Long surveys that are often forced, with managers pushing for participation metrics. Untimely: A quarter is too long; feedback suffers from recency bias. One-way: Comments can’t spark conversation, so team-specific issues often go unaddressed. At Cohesity, thanks to the leadership of Rebecca Adams, we use Workday PeakOn for continuous employee engagement, and it’s made a meaningful difference: No pressure: Brief, biweekly surveys with optional participation. 30–40% of the team usually responds because they want to. Timely: Focus areas evolve over time, so we’re focused on what matters now. Two-way dialog: Anonymous conversations let managers respond to comments without revealing employee identity. I’ve learned a great deal through these exchanges, and it’s gratifying when team members choose to continue the conversation openly as trust develops. Our engagement scores aren’t perfect, and as in any real business, not all issues can be solved quickly. However, I’m grateful for the steady pulse and the visibility on issues as they emerge. I highly recommend a continuous listening approach to any leader serious about building a better culture. #EmployeeExperience #Leadership #PeopleFirst #ContinuousEngagement #WorkdayPeakon

Annual reviews are dead. Continuous feedback is the future. Traditional performance reviews are too slow, too vague, and too disconnected from day-to-day work. Companies that stick to outdated models risk disengagement, misalignment, and missed opportunities. Real-time feedback drives agility. Employees need immediate insights to course-correct and build on strengths. Waiting months for performance discussions means losing momentum and delaying growth. Companies that embrace continuous feedback create a culture of responsiveness and adaptability. Engagement skyrockets when feedback is ongoing. Employees who receive frequent, constructive input feel more valued and supported. This translates to stronger motivation, higher productivity, and greater job satisfaction. Annual reviews often feel punitive; continuous feedback fosters development. Alignment improves across teams and leadership. When feedback flows regularly, employees stay connected to company goals. Leaders can address performance gaps before they become major issues, ensuring teams stay on track and high performers receive the recognition they deserve. Retention benefits from a culture of real-time recognition. Employees leave when they feel unseen or unappreciated. A continuous feedback loop reinforces value, supports career growth, and reduces turnover. The transition isn’t just about HR—it’s a cultural transformation. Organizations must train managers to give meaningful feedback, integrate feedback tools into workflows, and shift mindsets from evaluation to development. This isn’t a trend; it’s a strategic necessity. Learn more at https://buff.ly/4i24NfX