The Society for Industrial/Organizational (I/O) Psychology recently released their 4th annual top 10 workplace trends. This list is meant to showcase the areas that I/O Psychologists believe are the most important to address for organizations in the upcoming year. Click here to read the full article.
While there is a lot of interesting information here the most interesting is the #1 trend. The “winner” was the changing nature of performance management. See below for an excerpt from the SIOP article:
#1. The Changing Nature of Performance Management: How to evaluate and manage performance has been one of the key issues organizations have faced in recent years. News headlines have focused on large corporations ending annual performance reviews and ratings, but what will take their place? As organizations continue to face issues with traditional performance management systems proving ineffective or having a negative impact on engagement and culture, they can expect a greater need to think outside the traditional performance review box and focus more on evolving and redesigning performance management systems, rethinking annual reviews and ratings, and evaluating goal setting. Organizations can expect to rely less on once-a-year performance appraisals and more on frequent feedback and coaching to put the focus on improving performance.
The changing nature of performance management is not a new topic. In fact, it has been talked about for the last 8-10 years. Where Has Performance Management Gone? is a whitepaper that we published early last year addressing this exact topic.
It is very interesting to see, however, that there has been added emphasis on this topic recently. As I continue to work with organizations who are looking to hire and develop leaders, this topic seems to come up more and more. Many times the conversation is around how organizations are re-thinking performance management in light of millennials moving into leadership roles.
We know millennials work style can differ from other generations. (We also published a whitepaper on this topic last year - Developing and Engaging Millennial Leaders in the Workplace). One of the biggest needs for millennials is to receive feedback more often, and this is also cited in the SIOP survey. Organizations are rethinking how they give feedback. Giving leaders training on how to effectively manage and give feedback is critical. It is also important to have the technology in place to be able to facilitate this feedback process.
As we move into 2017 and beyond it will be interesting to see how organizations fill the performance management void. It is undoubtedly going to involve giving employees access to feedback more often (in real-time), giving them access to developmental resources, and more formal coaching. Organizations who can make this happen will begin winning the war for talent and also have higher retention rates. Organizations who are late to adopt this type of feedback program will likely fall behind.