Performance Management Isn’t Broken. Our Approach Is.

Written by Dan Straw

I was sitting on a train recently, on my way to a conference, when I found myself listening to a conversation taking place in the seats opposite me.

Two colleagues were discussing their upcoming mid-year reviews.

Neither sounded particularly enthusiastic.

One was complaining about how long it had taken to complete their self-assessment. The other was frustrated that they had spent most of the previous evening trying to remember everything they had worked on since January.

As I listened, one comment stuck with me.

“I don’t see why we still do these things.”

It made me smile because it’s a question I’ve heard countless times over the years.

And if we’re honest, many managers are probably asking themselves exactly the same thing.

The traditional performance review has become one of those workplace rituals that everybody participates in but very few people genuinely value.

Employees see it as an administrative exercise.

Managers see it as another deadline.

HR teams spend weeks chasing completion rates and producing reports.

Yet despite all that effort, organisations continue to wrestle with the same challenge: How do we help people perform at their best?

Or perhaps more importantly: How do we help people make the greatest possible contribution to organisational success?

The review itself is simply one moment in that process.

The problem is that, in many organisations, it has become the only moment.

When performance conversations happen twice a year, employees are left trying to remember six months of achievements, challenges, and development opportunities. Managers are forced to reconstruct half a year’s worth of observations from memory.

The result is often a conversation that feels more retrospective than useful.

Perhaps the problem isn’t that reviews exist.

Perhaps the problem is that we’ve come to think of performance management as something that happens during a review, rather than something that happens every day.

The phrase performance management may even contribute to that mindset. The word “management” suggests measurement, evaluation, and control. But the behaviours that genuinely improve performance are coaching, feedback, development, and removing barriers that prevent people from succeeding.

A single meeting cannot compensate for months without regular coaching and feedback.

If we look outside the workplace, the flaw in that approach becomes obvious.

In elite sport, performance isn’t managed through a six-monthly conversation.

Athletes don’t receive coaching twice a year.

Coaches don’t wait until the end of a season to discuss what went well, what didn’t, and what needs to improve.

Performance is reviewed constantly. Feedback is immediate. Development is continuous.

Goals evolve.

Nobody would expect an athlete to maximise their potential with only two meaningful coaching conversations each year.

Yet many organisations still expect exactly that from their employees.

To be fair, many organisations recognised this challenge years ago.

Over the last decade, we’ve seen a significant shift away from traditional annual and mid-year reviews towards continuous performance management. The intention was absolutely right. More frequent conversations. More agile goal setting. More timely feedback. More meaningful development.

But it raises an interesting question.

Have we genuinely improved performance management, or have we simply removed the paperwork?

Because replacing an annual review with high-quality coaching conversations is progress.

Replacing an annual review with a monthly catch-up that lacks structure, challenge, feedback, and development focus is something else entirely.

I’ve seen organisations celebrate the removal of appraisal forms, only to discover that very little actually changed.

The form disappeared. The conversations didn’t improve. Managers received no additional support. Employees received no additional coaching.

The process became lighter, but not necessarily better.

The form was never the problem. The absence of consistent coaching and feedback was.

Which led me to another conclusion.

Perhaps performance management isn’t broken at all.

Perhaps our approach to it is.

One pattern I’ve observed across organisations is that performance management initiatives often focus heavily on redesigning the process while spending far less time helping managers develop the skills and confidence to coach effectively.

The process changes. The conversations often don’t.

Which brings me back to the question of what we’re actually trying to achieve.

Perhaps the problem with performance management is the name.

Because nobody wakes up in the morning thinking about managing performance.

Leaders want better outcomes. Employees want to succeed. Organisations want people to make their greatest possible contribution.

That’s why I’ve increasingly found myself using a different phrase.

Contribution maximisation.

It isn’t just a different label. It’s a different objective.

That’s what contribution maximisation is really about.

Because the objective isn’t really to manage performance.

The objective is to help every employee understand what success looks like, give them the support to achieve it, and create an environment where they can contribute as effectively as possible.

At its best, this isn’t simply an HR initiative at all.

It’s about helping people understand how what they do contributes to the success of the organisation.

When that happens, coaching conversations become much more meaningful.

They’re no longer just about individual performance. They’re about helping people make a bigger contribution.

Everything else—feedback, coaching, development, goal setting, and technology—should exist to support that outcome.

The evidence reinforces this thinking.

Organisations that invest in more frequent coaching and development conversations consistently report improvements in engagement, capability development, and workforce effectiveness. Employees who receive coaching are also significantly more likely to establish and achieve meaningful development goals. It supports what many experienced leaders already know: better conversations drive better outcomes.

None of this should surprise us.

Most people don’t improve because they completed a form. They improve because somebody invested time in helping them improve.

The challenge is that managers today are expected to do more than ever before.

They lead teams. Deliver results. Manage change. Support wellbeing. Develop talent. Navigate increasing complexity.

And somewhere in the middle of all that, they’re expected to be great coaches, too.

Many genuinely want to be—but few have been given the time, tools, or training to do it consistently.

This is where I think technology, and increasingly AI, has a genuinely important role to play.

For years, organisations have used technology to automate performance management.

Forms. Workflows. Reminders. Approvals. Completion rates.

Useful? Absolutely. Transformational? Not really.

The opportunity now is very different.

AI has the potential to reduce much of the administrative burden that has traditionally surrounded performance management. It can help managers prepare for conversations, surface achievements that might otherwise be overlooked, identify development opportunities, summarise progress against goals, and even suggest coaching questions.

But AI won’t create a coaching culture on its own. Poor conversations supported by AI are still poor conversations. AI won’t create better managers. But it can remove enough administrative burden to allow managers to spend more time doing what only people can do: coach, develop, and support other people.

Not to replace manager—to make them better managers.

Nobody wants an algorithm conducting their performance review.

But most managers would benefit from having a better starting point for the conversation.

And perhaps that’s where the future lies.

Not in removing reviews. Not in creating more forms. Not in rebranding performance management every few years.

But in creating cultures where coaching, feedback, and development happen continuously, rather than being concentrated into a handful of meetings each year.

Because when performance conversations only happen twice a year, the review becomes the event.

When coaching happens continuously, the review simply becomes a summary of a journey that’s already taken place.

Maybe those two colleagues on the train were asking the wrong question.

The question isn’t whether performance reviews should exist.

The question is whether we’re creating enough opportunities for coaching, feedback, and development between them.

Because performance reviews don’t improve performance.

Great coaching does. Great managers do.

Great organisations create the conditions that allow them to succeed.

The review simply records whether that coaching has already happened.

Contact us to start a conversation, or register for our next live SAP SuccessFactors demo.

About the author: Dan Straw has extensive experience helping organisations transform HR through technology, digital innovation, and AI. He writes about the intersection of people, technology, and business change, sharing practical insights that help organisations improve employee experience, simplify HR operations, and make more confident decisions.