What happened
Most organizations still run performance on an annual cycle of ratings and paperwork. As reported by Talent Canada, that model is losing credibility, and many employers are moving to what the article calls performance development.
The numbers cited come from Gallup. Only 2 per cent of Fortune 500 chief human resource officers strongly agree that their system inspires employees to improve. A 2023 Gallup study found 95 per cent of managers were dissatisfied with their organization's review system. The article's argument is that reviews look backward, flow one way from manager to employee, and feel transactional.
Performance development replaces that with regular two-way conversations, managers who act as coaches, and plans built around future skills. The article lists four steps to get there: visible support from senior leaders, training managers to coach, giving employees ownership of their growth goals, and using the collaboration tools teams already work in to make feedback easy.
Why it matters if you are hiring
Candidates compare employers on more than pay. Many want to know how they will be coached, what they will learn and where the role leads. If your answer is one review a year, that is a weak pitch against an employer who can describe regular check-ins and a development plan.
The article also links development to retention. Employees tend to stay where they get ongoing coaching, and in a tight labour market that cuts recruitment cost and keeps institutional knowledge. For roles that are hard to fill, such as supervisors, controllers, skilled technical staff and sales leaders, keeping a good person is cheaper than replacing them.
The weak point is usually the manager. Many were trained to evaluate, not coach. If you promote your best individual contributor into a team lead role, expect to train them in feedback and goal-setting, or the new model will not hold.
One thing to do this week
Pick one team and book a 20-minute check-in with each person on it this month. Use three questions: what is going well, what is blocking you, and what skill do you want to build next. Write down the answers to the third question. That list is the start of a development plan, and a concrete thing to describe to the next candidate you interview.
Traverse has placed operations, finance, sales and technical people with Canadian and US employers since 1997, and we help hiring managers describe the growth a role offers so the right candidates see it.