September 26, 2025

Performance Management as Employee Experience: Moving Beyond Reviews to Growth and Engagement

By David Dungay

Performance reviews don’t have the best reputation. For a lot of people, performance management still means one awkward meeting a year, a form that disappears into HR’s system, and feedback that’s already out of date. It’s no surprise employees groan when they hear the phrase.

The annual review isn’t dead. About 49% of companies still rely on them. What’s changing isn’t whether we manage performance, but how.

Old-school reviews are for recordkeeping, not people. That’s why they feel so disconnected from the everyday work experience. It’s also probably why so many companies have a problem with engagement – one that’s costing the global economy about $8.9 trillion a year.

Leaders at companies like Adobe and Deloitte walked away from annual reviews years ago. They shifted to continuous feedback – short, regular check-ins focused on coaching and clarity. The impact was employees reporting stronger trust in managers and a clearer line of sight between their work and the company’s goals.

That’s the shift companies need to make now, from annual scores and forms to constant recognition, growth, and clarity, woven into daily work.

Why Traditional Annual Reviews Fail from an EX Perspective

If the annual review feels broken, that’s because it is. From an employee experience standpoint, here’s why:

• Bad timing: Once-a-year feedback comes months too late. By the time a project is discussed, the details are forgotten, and the chance to course-correct has already passed.
• Manager bias: Studies show 60% of a performance rating reflects the manager, not the employee. That means the outcome depends more on who’s in the chair across from you than the work you’ve actually done.
• Low motivation: Gallup found that only 2 in 10 employees feel reviews inspire them to do better. For most, it’s either meaningless or discouraging.
• Lack of value: A Mercer study found just 2% of companies feel their review process delivers real impact. Even so, nearly half continue to run reviews on annual or twice-yearly cycles. That’s a heavy lift in time and stress for almost no return.
• Poor employee experience: When reviews come across as paperwork instead of progress, trust erodes. People stop seeing the system as something built for them.

Really, the traditional review doesn’t do what it promises. It doesn’t drive growth. It doesn’t build trust, and certainly doesn’t create the kind of performance management employee experience that keeps people engaged.

Continuous Feedback as the New Experience Standard

If annual reviews are the sticking point, then continuous feedback is the answer. Rather than waiting twelve months for a single conversation, managers and employees meet more often with short, focused check-ins that happen while the work is still fresh. Here’s what that looks like:

• Quarterly check-ins. Adobe replaced annual reviews with quarterly conversations. The result? Less stress, more clarity, and employees who felt trusted rather than judged.
• Monthly 1:1s. A standing slot between manager and employee to talk progress, blockers, and development, not just deliverables.
• Project-end reviews. Feedback right after the work is done, when it’s fresh and actionable.

This new approach is what employees actually want – an ongoing conversation, not annual assessments. When companies deliver that in their approach to performance management, trust grows, performance skyrockets, and teams feel more engaged.

It’s not without risks. Get it wrong and you can end up with feedback overload or managers who slip into micromanagement. The key is balance, having short and purposeful conversations, rather than constant commentary.

When feedback becomes part of daily work, modern performance reviews stop being dreaded events. They become the foundation of a better employee experience.

The Playbook for Better Performance Management

Most people don’t judge performance management by the software or the forms. They judge it by the conversations they have with their manager. If those conversations feel rushed, vague, or unfair? That’s the whole process, ruined.

So let’s get practical about what actually works.

1. Feedback Models You Can Grab in the Moment

Nobody’s flipping through a training manual mid–1:1. Managers need patterns they can reach for on the spot.

• SBI (Situation–Behaviour–Impact): quick and clear – what happened, what you saw, why it mattered.
• COIN (Context–Observation–Impact–Next steps): handy if you need to end with an action.
• STAR (Situation–Task–Action–Result): especially good for recognition, showing the chain from effort to outcome.
• Feed-Forward: skip the rehash, focus on what to do next time.

Consumer Cellular rolled out structured feedback training through CultureAmp. Just using simple models like these. Within a year, trust scores in leadership had climbed 15%.

2. Rhythms That Take the Sting Out

Feedback works better when people are expecting it. Nobody likes being blindsided. The best managers establish a rhythm so that their teams know when the conversation is coming.

• Weekly one-to-ones for progress and roadblocks.
• Monthly talks about development, not just delivery.
• Team shout-outs or thank-yous baked into meetings.

DrFirst introduced monthly coaching check-ins, and the tone of performance discussions shifted almost overnight. People described their managers as coaches instead of judges.

3. Building Actual Coaching Skills

Promoting someone doesn’t make them a coach. Most new managers are good at the job, not at developing people. That’s why training has to cover basics like:

• Giving feedback without flattening motivation.
• Spotting bias – like rewarding whoever you saw most recently.
• Listening properly. Not nodding until it’s your turn to talk.
• Helping people map their goals to where the company’s going.

Do that well and you build trust. Miss it, and the conversation feels hollow.

4. Fairness Isn’t Automatic

Fairness is where a lot of systems fall down. If people don’t believe reviews are fair, nothing else matters. And fairness takes work:

• Calibration sessions stop one manager’s generosity (or stinginess) from skewing results.
• 360 feedback brings in more voices, so performance judgments aren’t lopsided.
• Shared definitions of “high performance.” Otherwise, the standard shifts wildly depending on which team you’re on.

Skip this, and employees start treating the whole thing like a lottery. Once that happens, performance management turns toxic.

5. Recognition That  Lands

Recognition is often treated like a “nice to have,” something you squeeze in if there’s time. That’s a mistake. People don’t just want a “thanks”; they need it to feel their effort matters. The key is making it specific and timely.

“Good job” is polite but forgettable. “Your analysis made the client’s decision easier and saved us a week of back-and-forth. Tie it back to company values, and suddenly you’re reinforcing culture too.

Recognition doesn’t have to be grand. A thirty-second thank-you at the end of a call. A quick message in the team chat. When it’s regular, it reshapes how people feel about their work.

Goals as Experience Design: OKRs & Alignment

One of the easiest ways to ruin performance management is by leaving people in the dark about what actually matters. Ask around in most companies and you’ll hear some version of: “I know what my team does, but I’m not sure how it connects to the bigger picture.” That disconnect is deadly for engagement.

Clear goals shape the experience. When employees understand how their work ladders up to the company strategy, it changes the way they feel about their jobs. Stress drops. Focus sharpens. People can see why what they do counts.

That’s where OKRs (Objectives and Key Results) come in.

• Company-level objectives set the direction.
• Team OKRs break that down into what each group is aiming for.
• Individual goals translate the strategy into day-to-day work.

Write goals like this, and they do double duty: they drive performance, and they improve employee experience by giving people clarity.

The Cleveland Guardians used this approach with Leapsome to unify how they tracked goals and check-ins. Staff said they felt clearer about priorities and less like they were working in silos. In sports and in business, that kind of alignment is priceless.

Enablers of Transformation: Leadership, Tech, and Change Management

Shifting from annual reviews for performance management to continuous feedback isn’t just a process change. It’s a cultural one. Like any culture shift, it succeeds or fails on the back of leadership, communication, and the tools you choose.

1. Leaders Have to Walk the Talk

McKinsey’s research is clear: transformations are five times more likely to succeed when leaders role-model the change. That means executives can’t just mandate new review cycles; they have to show up to their own one-to-ones, give recognition publicly, and treat feedback as part of daily work.

It also means holding leaders to account. Link part of their incentives to employee experience outcomes – retention, recognition, and wellbeing scores. Once leaders know the quality of their team’s experience will reflect on them, priorities start to shift.

2. Build Governance Around Experience, Not Just Compliance

Traditional performance management was built around compliance: forms completed, ratings submitted. Continuous systems need governance too, but with a different focus:

• EX councils that bring together HR, IT, Finance, and Ops to align on strategy.
• Guardrails around data: anonymity thresholds, clear rules on how employee feedback will (and won’t) be used.
• Time-boxed reviews of the system itself: quarterly audits of how fair and beneficial employees find it.

This isn’t red tape; it’s how you prove to employees that the process is trustworthy.

3. The Must-Haves in Tech

Modern performance management systems need to do more than store ratings. They should make performance conversations easier, not harder. At minimum, that means:

• Shared agendas for one-to-ones so nothing gets lost.
• A way to give and request continuous feedback in real time.
• 360-degree feedback flows that pull in multiple perspectives.
• Goal and OKR tracking that links individual work to company outcomes.
• Analytics dashboards so HR and leaders can see trends without drowning in spreadsheets.

AI is creeping into performance management, too. Done right, it can help managers spot patterns, like who’s getting less feedback, or which teams are struggling with goals. It can nudge managers to check in or even draft feedback suggestions.

4. Communicate Like You Mean It

Employees are quick to notice when feedback disappears into a black hole. If you collect input, you have to act on it and tell people what you did. Publish “You said, we did” updates within 30 to 45 days. Even if you can’t fix everything, showing movement keeps trust alive.

Energy Collective did this with HiBob’s people analytics. They didn’t just collect survey data; they shared back the changes they made, from small policy tweaks to new development programs. Engagement scores went up, not because every issue was solved, but because people finally saw evidence that their voice mattered.

5. Manage the Risks Head-On

Continuous feedback done poorly can create new problems:

• Feedback overload that feels like micromanagement.
• Survey fatigue when employees are asked for input with no follow-up.
• Privacy concerns if people suspect their comments are being tracked too closely.

A good change plan acknowledges these risks up front and explains how they’re being managed. That transparency matters more than promises that “everything will be fine.”

Measuring Performance Management ROI

If you want performance management to feel like part of the employee experience, you have to measure more than just output. Numbers matter, but so do trust, fairness, and whether employees actually believe the system helps them.

Here’s what belongs on a modern scorecard:

• eNPS: The employee Net Promoter Score is a simple, brutal question: “On a scale of 0–10, how likely are you to recommend this company as a place to work?” Track it quarterly and you’ll see if performance processes are building engagement or breaking it. A rising eNPS after a change in reviews or feedback systems is a strong signal that you’re on the right path.
• Engagement and Absenteeism: Engaged teams don’t just feel better, they turn up more. Gallup shows they have 41% lower absenteeism. High absence rates are often a signal of disconnection. Pairing absence data with pulse surveys helps uncover the why.
• Retention and Turnover Costs: Losing people is costly. Hiring and training replacements can run from half to double an employee’s salary, once lost productivity is included. If departures come from a lack of growth, that’s money leaking straight out of the business.
• Manager Effectiveness: Check the basics. Are one-to-ones happening? Do they have agendas? Do employees say they’re helpful? A simple audit of these touchpoints will show whether managers are building trust or just ticking boxes.
• Fairness Checks: Performance management collapses if employees think the game is rigged. Watch for signs of unfairness, like specific teams or employees being consistently over- or under-scored, without evidence of why.
• Friction Heatmaps: Sometimes the problem isn’t managers or goals, it’s the work itself. Analytics can spot “friction” by looking at things like ticket response times, workflow delays, or constant context switching. If performance conversations keep circling back to broken processes, the data will back it up.

Performance Management as Culture-Building Strategy

For years, performance management was an HR chore. Fill out the form, tick the box, and move on. That mindset doesn’t work anymore.

The companies that get this right see performance management for what it really is: culture in action. It’s how recognition happens, how fairness is maintained, and how people see their role in the bigger picture.

Do it badly and people switch off. Do it well and you get a loop of trust, growth, and performance that keeps pushing the business forward.

At the end of the day, performance management for employee experience isn’t about reviews at all. It’s about building a workplace where people want to do their best work, and know they’ll be supported while they do it.