Continuous Performance Management Trends 2025

Traditional performance management is based upon outdated and archaic methods aimed to improve productivity and to achieve business objectives. Negative connotations associated with traditional performance management include an over-reliance on annual performance reviews, the setting of static goals, fails to provide real-time feedback and an overbearing focus on evaluation and weaknesses.

Over the last few years, there has been a shift from traditional performance management methods to continuous performance management. Continuous performance management is defined as performance management processes that take place throughout the year on an ongoing basis. It typically includes one-on-one conversations with managers and direct reports, regular performance and development conversations, and ongoing, real-time feedback.

Why has there been this shift towards continuous performance management? Simply, this methodology has been shown to wreak organisational benefits. A survey by Bersin and Associates found that of those companies that reviewed goals each month, over half were also in the top percentile for performance. In contrast, of those companies that reviewed goals annually, only 24% fell into the same bracket. A study by Gallup identified that employees had regular one-on-one meetings with their managers are almost three times as likely to be engaged. Lastly, frequent feedback has been shown to boost performance by up to 39%. In the blog below, we outline four continuous performance management trends for 2025 and how PeopleGoal can help you to align your organisation with these trends...

Simplicity not Complexity

Performance management systems should be user friendly and easy to use. In his ‘Handbook of Performance Management’ Michael Armstrong states that a performance management system should be “easy to understand”. As we go through 2025, more and more companies will switch from complex metrics such as annual appraisals, calibration meetings and competency assessments, to regular meetings and ongoing feedback.

Many companies’ current performance management systems are no longer suitable in the new age of agile performance management. Instead they are looking for software that is simpler, flexible and supports discussions and feedback in real time. The PeopleGoal software offers a performance management system that captures these needs. PeopleGoal is a modular, customizable platform that allows you to tailor your current performance management process, rather than be dictated by a strict formula.

Growing Employees

Although it can be collated under a general HR banner, the growth and development of employees is a key facet of continuous performance management. The majority of the modern workforce state that growth and development opportunities are now critical aspects when looking for a job. A modern approach to performance management encourages and aids employees in planning out their development plans.

Through aspects of continuous performance management like real-time continuous feedback and regular one-on-one’s, employees and their managers are able to have constructive discussion about continuous professional development and career progression.

In turn, this allows managers to propose the investment of education, mentoring or training in individuals looking to further their career. Employees can see their development plan, have frequent discussions with their managers to identify what they are doing well, what they need to be doing better and where they need to go in order to achieve their goals.

Beginning of the end for annual appraisals

Annual performance appraisals are becoming eschewed in favour of regular one-to-ones and continuous feedback when managing performance. The principles of continuous feedback are relatively simple, but a performance management platform can take its effectiveness to the next level. PeopleGoal actively encourages ways of managing performance. It helps individuals, teams, departments and the company create goals and objectives, it provides a clear trajectory plan for these goals. Individuals can align their goals to the companies. PeopleGoal provides visibility to HR of who is underperforming, performing and achieving. Long gone are the days of annual performance, the current age demands performance management software which intuitively provides structure, feedback and real-time data to continuous performance management.

Quality of Conversation

With the shift from traditional to continuous performance comes a transition to more regular one-on-one meetings and frequent real-time feedback. As more and more organisations begin to adopt this approach, the need to make performance dialogue more effective becomes obvious. In 2018, organisations must:

• Provide management training in everyday coaching and mentoring skills.
• Reduce the bureaucratic approach to performance review.
• Provide both managers and employees with a framework for high-quality meetings and for giving feedback to maximise effectiveness (see our blogs on one-on-one meetings and providing constructive feedback).

Looking for more ways to understand why performance management is important? Check out our practical toolkit — Modernizing your Performance Management Processes.

It’s free, easy, and simple to use.

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You can also email us directly at contact@peoplegoal.com.