Performance Reviews In The On-Demand Economy

3 min read
WorkMarket Editorial Team
WorkMarket Editorial Team
Performance Reviews In The On-Demand Economy


Is the traditional performance review dead? The once-a-year “pow-wow” seems to be going the way of the dinosaur. For starters, companies like Accenture, Gap and Microsoft are ditching the antiquated pastime. According to Deloitte, organizations spend two million hours a year compiling reviews. Historically, employees have been rated on a scale or curve, but that’s all changing.

About 30 large companies have already ditched the traditional process for performance reviews in early 2015, according to the Neuroleadership Institute. The no-ratings system continues to gain popularity, with 51 large firms adopting this approach by September 2015.

There’s just one problem.

“One important and growing population in organizations isn’t benefiting from this feedback renaissance,” write Jon Younger and Norm Smallwood in a recent HBR article. “They’re the external professionals your organization increasingly counts on: freelancers, gigsters, advisers, and consultants.”

With 27 million people now part of the corporate on-demand economy, the so-called “feedback renaissance” must continue to evolve. Businesses will have to start approaching their external talent as an extension of their business, especially considering the fact so many of these professionals are becoming a strategic part of their workforce.


Our recently released “2016 Corporate On-Demand Talent Report” reinforces that notion. Of the 1,000+ companies surveyed, 46% are using on-demand professionals for more than a year at a time while 42% are using the same professionals more than half the time. While not traditional employees, these professionals are becoming a bigger and more influential part of today’s modern organization.

According to Younger and Smallwood, most organizations are not set up to benefit from their increased investment in agile talent. “Research by PMI describes most problems in project performance as being the result of alignment issues, and the alignment gap is greatest when it comes to performance management.”

Our research also seems to echo those findings. Not only are a majority of the businesses we surveyed (73%) still managing their on-demand workforce manually, many of them don’t even have consensus on who’s supposed to be managing this talent. This, understandably, can cause serious misalignment between an organization and the growing legion of independent professionals in their workforce.

One way to close the gap? Technology. New tools and apps are radically transforming how feedback is supplied and consumed. The ubiquity of


mobile phones is also making it easier than ever to provide instantaneous, relevant feedback. The desire for immediacy is growing ever more infectious in a world of instant gratification and real-time everything.

For one example of a company embracing a new approach to performance management, look no further than General Electric (GE). Ironically enough, GE’s CEO from 1981-2001, Jack Welch, notoriously pioneered the “stack and rank” management philosophy that dominated corporate HR circles for nearly two decades.

“Welch’s approach to management made him a legend at GE and American business schools. But his style and focus on the annual performance review simply doesn’t work for the company or its younger workforce any more, say GE human-resources executives.”

“The world isn’t really on an annual cycle anymore for anything,” GE’s head of human resources, Susan Peters, tells Quart. “I think some of it, to be really honest, is millennial-based. It’s the way millennials are used to working and getting feedback, which is more frequent, faster, mobile-enabled, so there were multiple drivers that said it’s time to make this big change.”

The company is now relying on a new app, called “PD@GE” to administer reviews to its entire workforce. The app-based approach allows the company to collect real-time feedback, monitor areas of improvement, provide 360 degree feedback, and much more. This trend should continue to gain momentum as more businesses realize the importance of modernizing antiquated performance reviews and empowering their independent workforce with the feedback and information they need to be successful.

Performance reviews on the fly? There’s (now) an app for that.