It’s no secret that HR organizations need to completely revamp how they approach employee engagement, starting with the annual employee review.
Managers don’t like giving reviews because it’s difficult and time consuming to summarize a year’s worth of work in one review, and employees don’t like receiving reviews because they can’t fix problems that happened months ago. Employees also face the unnecessary stress of wondering how their rating compares to their peers.
Annualized processes such as performance reviews, goal setting and company-wide surveys are universally disliked, outdated and ineffective. All employees crave learning, a career growth path and meaningful work, but Millennials especially value instant feedback and their voice being heard within an organization.
With Millennials making up more than half the workforce, it’s time for businesses to evolve how they manage this generation, or risk losing talent. Here are top five ways to better engage and retain top talent.
1. Ditch annual reviews and shift focus to continuous feedback
According to Cornerstone’s Employee Performance Management Survey, 45 percent of HR managers don’t believe annual reviews are an accurate representation on the employee. The same poll revealed that 90 percent of performance appraisals were found to be painful and didn’t work.
So if the annual reviews aren’t accurate, don’t work and the employer and the employee both find them painful, why continue the process?
The work landscape is very different now: Most employees wear more than one hat within their organizations, which means that work is happening more frequently across multiple teams. This approach makes individual tracking and rating challenging, since the employee will get direction from a variety of managers.
Once a company has made the decision to do away with the annual performance review, what should they use for development instead?
Instilling a system of continuous feedback allows employees to change behavior on-the-fly and develop skills more quickly. Giving and receiving instant feedback through consumer applications such as Facebook, Uber and Yelp has increased expectations for workplace applications.
The first step to increasing feedback is to understand what feedback looks like. Continuous feedback may look slightly different at every company, but according to a Towers Watson survey, 43 percent of people who identified as “highly engaged” received coaching at least once a week.
One way to ensure weekly meaningful conversations take place is via technology platforms that enable continuous feedback. Managers now have easy to use, mobile friendly tools to coach and develop their teams. Technology also provides a documentation mechanism so that both the employee and the manager can refer to prior discussions.
By conducting more nimble, future-focused conversations, employers can enhance the company culture while helping their people recognize personal strengths so they take charge of their career development.
2. Implement agile and transparent goals
In today’s fast-paced work environment, everyone’s busy. It’s easy to get lost in the weeds, become unfocused and then run out of steam.
With an employee engagement application, teams can set and track quarterly individual and team goals with objectives and key results (OKRs) that are aligned with company goals. Make those goals transparent across the organization to facilitate collaboration across departments.
By setting attainable goals, employees can focus on the work that matters most. Tying employees’ quick wins to larger goals builds confidence and poises all parties for success. This also directly facilitates more frequent conversations between employees and managers.
Managers can also better identify dependencies and resourcing risks. With a mobile interface, managers can quickly comment on goal progress and employees can update goal statuses in real-time.
3. Prioritize real-time recognition
While career opportunities and pay are typically the top priorities when candidates select an employer, the third most important tends to be recognition, especially for Millennials. However, the traditional “employee of the month” rewards aren’t cutting it any more – companies need to get more creative and recognize their employees in a timely and visible way.
HR should encourage real-time, peer-to-peer and top-down recognition to showcase individual and team accomplishments, and empower employees to recognize great work around them.
Let employees choose rewards that are relevant to them, including non-monetary, monetary and creative cultural rewards tailored to your company. However, there is something more important than changing the reward – it’s about changing when the reward is given.
Giving recognition as soon as it’s deserved (e.g. after a major client win or company success) is more impactful than on a standard basis. The closer to the achievement the recognition is given, the more impact it has.
4. Capture the voice of the employee
Companies need to listen to the insights shared by employees.
By utilizing real-time mood and sentiment tracking, aka “pulse checks,” and period benchmarking surveys, a company can use the results to create an open dialogue for positive change. It’s important to monitor the overall mood of an organization, and then use that feedback to find inefficiencies and roadblocks before they happen.
It’s vital to tune into the voice of the employee, especially during times of change like rapid growth, downsizing, mergers and acquisitions, and new leadership.
Taking it a step further, a company can’t just identify what changes their employee’s want – they need to actually make them. If companies answer questions and address concerns, they will instill trust and eliminate issues before they become huge problems.
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Even if a solution isn’t provided for every problem that’s being discussed, just listening to employees will make them feel empowered. Allowing everyone a voice and involving them in the decision-making process will keep employees happy and improve retention.
5. Bring it together to get a clear view of organizational health
By taking advantage of an employee engagement platform for all of the aforementioned business priorities, the company leadership will gain valuable insights about the overall health of the organization.
As your engagement data grows with use over time, the system becomes smarter, uncovering things you should know.
Just like a manufacturing facility would look at capacities and inventory, an engagement application exposes employee data and spotlights people and groups that are happy and productive as well as systemic problems. You can analyze all of the key drivers of engagement specific to your organization and the demographic groups within it.
Slice and dice the data by almost any attribute, including business unit, tenure or location, while protecting individual employee confidentiality. Share your findings transparently and help your employees grow their skills, value and impact over time.
These strategic shifts will help improve a company’s culture and health, as well as save money through improved employee retention, productivity and reduced recruiting costs. Not to mention the efficiency gains through reduced time spend on the bulky traditional annual processes.
By doing away with an annual review, focusing on continuous feedback, implementing cascading goals, prioritizing real-time recognition and listening to the voice of the employees, HR professionals will be able to effectively understand the organizational health of the company and proactively address systemic or point issues in the business.
These HR changes will help align goals and objectives to empower employees to be more innovative, and improve a company’s brand image.