Annual Performance Reviews or Continuous Feedback?

Annual performance reviews or appraisals are important. They are a way of assessing that an employee is performing the job to the required standard, that they are competent to carry out the tasks demanded by the role, and that they have appropriate support from management. Under SM&CR, staff in-scope of the Senior Managers Regime and/or the Certification Regime must be assessed for fitness and propriety at least annually. Firms may decide to align this requirement to their wider appraisal processes.

Appraisals tend to take place just once a year. As such, the prospect of an upcoming review can lead to anxiety, tension and uncertainty among the staff. However, this does not need to be the case. If employees receive feedback and open communication with their managers on an ongoing basis, there are unlikely to be any big surprises when appraisals come around.

There may be some managers, who look back at an employee’s work over the last year and note areas of underperformance. Rather than addressing the issues when they manifested, the manager may say nothing until the appraisal. The employee, perhaps not realising anything was wrong, may feel surprised and upset by their manager’s comments.

Instead, an open and transparent organisational culture, whereby feedback is given regularly, and acted upon, is healthier for all concerned. Managers should praise or reward good work, a positive work ethic and strong performance when they see it. If someone’s doing a good job, tell them. Acknowledgement and appreciation can go a long way.

Conversely, if things aren’t going well or if a member of staff appears to be going ‘off-track’, intervene gently at an early stage and help them make the necessary changes. This will mitigate against problems further down the line. Friendly suggestions or feedback on how to improve performance may be very much appreciated if delivered in the right way.

A good manager will know their team members and understand their individual career aspirations. If these aspirations can be aligned with the aims of the company, this can be motivating to the individual and beneficial to the company. By recognising both the individual’s goals and the needs of the company, a manager should be able to work with the employee to plot a career path and relevant support and training.

Personal development is an ongoing process and is not a conversation that should be had just once a year.

The process works both ways. Employees should feel free to speak up and tell their managers of anything that they are concerned about, knowing that they will be listened to. This is not about management giving employees anything that they ask for, it is about people being welcome to make suggestions, raise concerns and make reasonable requests, safe in the knowledge that they will be given respectful consideration.

Even in a culture of ongoing feedback, there is still a place for appraisals. However, these should take a consistent and transparent approach to help make sure everyone in the organisation is treated equally and fairly.

Using a system based on objective performance against clearly defined job specifications is a useful way of conducting an appraisal. Whilst an employee’s attitude and personal conduct are, of course, very important and should be discussed, managers should be cautious not to make an appraisal about an employee’s personality. It is their performance and ability to do the job that is key.

Appraisals look at work done during the past twelve months, but they should also look towards the future and the person’s future development within the organisation.

A well-conducted appraisal system and an open culture of continuous improvement and regular feedback can provide a motivating and positive working environment. This can benefit employees and employers alike.

An appraisal system is available via the Aviva Development Zone and we are also happy to help firms put an effective system in place on a face-to-face basis.

About the author

Kate is the chairman and co-founder of RWA and has worked for the company for nearly 20 years. She is a fan of developing practical, workable, business-led policies and procedures. Kate has specialist training experience within the financial services sector, including major general insurers, and the Lloyd’s underwriting and broking market. She has researched and developed numerous training programmes, both for commercial and in-house use. She has extensive experience of developing in-house and public training programmes for business skills, including Diversity, Employment Law, Management and Leadership, Motivation, Coaching and Feedback, Communication Skills and EQ.

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