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Performance Management Trends


Performance management is changing with the evolving workforces, work structures, and new technologies. If organizations are committed to developing their talent, then adapting to the current world of work is imperative.

In this article, we have compiled some of the biggest trends in performance management so you can stay up to date with current performance management strategies.

1) Continuous performance management

The annual performance reviews rarely provide an accurate representation of employee performance. 51% of employees find these annual performance reviews inaccurate and 90% believe they are painful and ineffective. To that end, many organizations are transitioning away from annual reviews. One study by Deloitte reported that 76% of organizations are reinventing their performance management to be more continuous to satisfy the needs of employees. This includes implementing real-time, continuous feedback.

Continuous feedback encourages employee development and accelerates skill development. It also increases the communication and trust between managers and direct reports. While continuous performance management cannot be implemented overnight (as it takes time and training), transitioning from the traditional once-a-year reviews to continuous feedback will increase the likelihood of employees’ success, and hence organizational success. In fact, out of the companies that introduced continuous performance management, 50% of them reported being more satisfied with their performance management processes and were able to outperform their competitors by 24%.

Not only is increased success and productivity a benefit of implementing continuous performance management, but there is also an increase in employee engagement, retention, and happiness. A study done by Betterworks claimed that 66% of companies who prioritize continuous performance management can boost employee productivity all year long.

2) People analytics is no longer a want, it is a need

84% of HR leaders surveyed from Deloitte claimed that people analytics is imperative. Having employee performance data allows for more educated decisions to be made about your talent. Without data, making strategic people decisions can be challenging. Organizations need to be able to develop their people. This is particularly true in professional service firms where your people services are what you are selling. People analytics can provide professional services insight into their employee’s strengths, weaknesses, and motivations, so better talent and training decisions can be made.

3) Transparency in leadership

A growing trend in performance management is transparency in leadership. In fact, 52% of Gen Z’s and Gen Y’s state that the most important quality for being a good leader is honesty and transparency.

For leaders in the workplace, transparency can mean communicating less over email and through third-party communication, but rather showing up more frequently and becoming more personally engaged with employees via face-to-face and/or video interaction. Moreover, leaders should keep their employees in the loop with good and bad news (without oversharing) and welcome honest feedback, which will help build trust.

4) Emphasis on employee experience

Employee experience has been a buzzword in the HR community. Employee experience is the journey an employee takes within your organization. It includes every interaction that happens along the employee life cycle – from the initial interview process to offboarding.

83% of HR managers believe that employee experience is key to organizational success. In fact, developing a great employee experience can lead to staff feeling happier, more productive, and more motivated. Creating a better employee experience comes down to two key factors: leadership and workplace practices (check out our previous article on employee experience for more details).

If you are looking for more resources on how to improve your performance management process, reach out – we would love to hear from you!

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