Employee Review Timing—Should They Be Annual or Anniversary Based?

I was reading an interesting debate in a LinkedIn group about when to do employee reviews – on the employee’s anniversary of employment or annually.  OK, if you’re like me, you first realize that technically the anniversary is annually, but the original questioner was actually suggesting that annual meant at the same time every year for every employee.  I’ve been at companies where both have been done, and even one that did a combo process that had an anniversary component and annual component.

The answers were pretty interesting for managing performance, especially since it wasn’t a poll, per se, where people would pick one or the other, but an open ended question.  So you ended up with lots of opinions that didn’t directly answer the question.  But overall the stream of comments was insightful for anyone managing employees and determining corporate review policies.

Are "Annual" Reviews Better?

There were certainly a majority of opinions that pushed toward annually, reviewing each employee at the same time every year.  There are definitely benefits for that, like the ability to coordinate reviews with the company’s overall performance.  This cycle also allows for more even comparisons across employees at the same level or in the same position, since everyone is being reviewed at the same time.  Consistency can be your friend here.

But having been in that process myself on both sides of the table, the main difficulty with an annual process can be the volume of reviews.  Trying to do strong, individualized reviews of multiple employees at the exact same time can be difficult, especially trying to fit evaluations and performance discussions into the rhythm of a busy job with other tasks that don’t stop just because it’s review time.

Why Anniversary Reviews?

A few opinions pushed for the anniversary review, with the pro-anniversary reasons matching nicely to the anti-annual camp, and vice versa.  The main benefit was the ability to devote more attention to each review since there aren’t as many to be done at the same time, with the con that your reviews don’t necessarily tie well to the company’s performance cycle.  How can you effectively tie individual contribution to corporate performance when they’re on different cycles?  The other issue here was the potential for these reviews to be impacted by most recent events… sure, that can happen with annual reviews too, where someone who does something great in the last month before reviews seems to have atoned for failures in the rest of the year.  Commenters seemed to think this problem was worse on the anniversary reviews, perhaps because you don’t have the same mindset of the annual review with multiple reviews.

But sometimes, especially in a busy environment, employees find that these anniversary reviews are late or forgotten, because they’re not tied to a clear schedule that everyone is following.  It’s hard to ensure that the review really happens on time, since it likely doesn't have the same sense of urgency or deadline.  I think that’s a problem easily solved with the right tools, but one that happens nonetheless, since the review becomes a backburner item.

None of the Above? Abolish the Performance Review

The more interesting part of the whole thread came in the comments about reviews in general.  Some of these views were pretty blunt, calling for the death of the performance review and suggesting that you’re already failing at managing employees if you’re only reviewing them once a year, no matter the cycle.  There’s definitely merit in that employees need feedback more consistently than once a year.  I don’t think that was the intent of the original question – many people still think there’s a place for a formal, recurring review of some sort, even when you’re doing the best job possible giving formal and informal feedback throughout the year.

My own views seem to fit into that camp to some extent, though I think there are benefits to ensuring that at least one well-documented retrospective review occurs at least annually.  Managers should be able providing ongoing feedback, every day, week, month and quarter, not just year.  If you’re not on top of performance regularly, your yearly review itself is not going to make much of an impact, to the detriment of the employee and the organization as a whole.

So how do you do reviews?