When someone says it’s time for performance evaluations, what happens? You can almost hear a collective groan ripple across an organization. Reactions run the gamut, from indifference to full-on dread. 

It’s not just the idea of a performance review that makes people so uneasy—it’s also how the process is handled. Although employees tend to agree that performance evaluations are beneficial, too often, the way employers conduct and use reviews leaves a lot to be desired. 

We’d like to dig deeper into why performance evaluations stir up so many less-than-positive reactions. But first, let’s look briefly at how they became a standard business practice…

A Short History of Performance Evaluations

Appraisals were first developed during World War I. Back then, they had little to do with helping people improve and move forward in their careers. Instead, military leaders used appraisals to determine which personnel had the skills to qualify for a promotion when openings became available. They also used appraisals to identify and dismiss underperformers, so they could protect their ranks from harm or inefficiency.

The practice of workplace performance evaluations didn’t gain a firm foothold until the 1960s. But since then, reviews evolved in two sometimes conflicting directions. One rationale focuses on assessing current talent. The other emphasizes talent development for the future. However, as employee reviews have become more widespread, so have their scope and complexity. No wonder this topic makes so many people groan.

Why Employee Reviews Are Often Loathed

Today, many executives, managers, and employees agree that the traditional performance review system is no longer practical or effective. This is primarily because reviews are usually conducted on an annual basis.

Experts agree that an annual review cycle isn’t frequent enough to change behavior. Instead, managers should ideally offer feedback or guidance soon after an issue arises, not months after the fact.

Also, with a year’s worth of activity to evaluate, an appraisal can become an intense, high-pressure process, charged with the fear of being reprimanded or fired. In addition, an annual cadence tends to put an organization’s interests first, while undervaluing the employee experience.

Even so, most companies haven’t figured out how to replace or adapt that traditional review process with something better. How can we redesign performance evaluations to more closely meet the needs of employees, managers, and the organization? Let’s start by clarifying those needs.

The Benefits of a Better Review Process

For employers, a strong review process helps people apply their skills and experience to support organizational objectives. Clearer priorities, fewer mistakes, improved performance, and a more united team all contribute to a more profitable and sustainable business.

For managers and other leaders, a strong review process is efficient and effective. It provides timely direction, re-energizes people who have been disengaged, and makes the whole team more eager to deliver high-quality results.

For employees, a strong review process provides a clear picture of their current skills and proficiencies, while offering useful guidance on how to improve. It makes people feel more connected with their role in the organization and more supported in their specific work goals.

What’s at Stake

By relying on these various interests as a blueprint for improving the review process, organizations can achieve measurable gains. For example, a more productive, supportive form of evaluation can be a highly motivating process. Ideally, it creates an opportunity for meaningful dialogue that builds people up, rather than tearing them down. That can make all the difference for organizations that recognize the business value of employee retention.

On the other hand, choosing not to invest in an effective evaluation process brings significant downside risks. For example, people tend to become disenchanted and disengaged when they’re expected to work without constructive feedback, clear goals, or meaningful career paths.

In fact, one survey indicates that 85 percent of employees would consider quitting if they felt they received an unfair performance review. Imagine the impact if that happened in your organization!

Designing Better Reviews

The key to designing effective performance reviews is to recognize that this is a process, not an event. So many of our negative impressions of performance evaluations come from worrying about a single, looming “judgment day” when we wonder if we’ll be praised, criticized, or perhaps even fired.

For a better experience all around, try these approaches:

1) Start with a Different Mindset

The point of a performance review is to measure performance. However, evaluations don’t need to be limited to numbers and volume metrics.

This is an opportunity to think holistically about an employee’s overall connection with their team, and with your company’s culture and values. It’s also a chance to consider qualitative factors that affect an individual’s mental and social well-being.

2) Co-Create the Review

Gone are the days of top-down leadership and authoritarian work atmospheres. A performance evaluation should be a two-way experience.

It’s helpful for managers to work with employees upfront to co-create the goals that will frame their performance evaluation. Goals that align with key business objectives will serve the organization’s interests while giving an employee a sense of autonomy, purpose, and direction.

3) Increase Evaluation Frequency

You may think fewer evaluations are better. But a once-a-year trial builds unnecessary pressure. Distributing all of that annual review energy across more frequent cycles is a much smarter option.

In fact, according to Gallup, employees who receive daily feedback from managers are three times more likely to be engaged than those on an annual review schedule. To encourage professional growth, consider adding monthly progress checks or weekly one-on-one meetings, focused on development.

4) Lead with Recognition

Motivating employees is not always complicated, and we don’t always need expensive perks to do it. Simply acknowledging someone’s work and effort can go a long way to making them feel engaged and connected to their goals.

A whopping 69% of employees say they would work harder if they felt recognized. Let that insight inform your review structure. By leading with acknowledgment—communicating first and foremost what an individual has done successfully—you lay a foundation of trust and validation that can lead to further dialogue.

5) Communicate Changes Clearly

Many performance evaluations focus on a salary increase or a title promotion. But even long-awaited good news needs to be delivered in a way that’s clear and motivating.

For example, with a salary change, what new responsibilities are expected? What new objectives come with this role? Use these shifts in position as an opportunity to have an open conversation about career growth and planning for future skills development and upward mobility.

Final Thoughts

It’s no secret—performance evaluations are a challenge to manage. And improving your existing methods may seem like a thankless task. But many employers are discovering that it’s well worth taking the time and effort to ensure that your process is truly effective.

Any investment you make to improve feedback and communication has the potential to strengthen the sense of connection people feel with their job, their team, and your organization. Ultimately, those kinds of benefits can lead to a significant impact on your ability to retain talent, enhance work quality and improve your bottom line.

Matt Romond is an HR business partner at Jotform. He’s passionate about collaborating with teams to help them do their best work. Outside of work, Matt loves spending time with his family and adventuring in the mountains.

Alexis Russell is the U.S. HR business partner at Jotform. Based in San Francisco, she is the point of contact for all things HR and recruitment at Jotform.