• Riley Steinbach

50 Mind-Blowing Performance Management Statistics You Should Know

The outdated practices in traditional performance management are no longer working for today's workforces. Here are some interesting statistics to check out regarding performance management systems, corporate culture, employee engagement and feedback.

performance management stats


Performance management statistics

1) 95% of managers report they are “unhappy” with traditional performance reviews according to CEB study. (Source: Gartner)


Most performance management systems are ineffective at developing and retaining employees; this is particularly try with annual performance reviews which are biased and unreliable.


2) Managers spend 210 hours a year on performance management, and employees spend 40 hours a year. (Source: Gartner-CEB)


Time is money! Organizations have to implemented technology and processes that streamline performance management.


3) 51% of employees believe that annual reviews are inaccurate and 53% say it does not motivate them. (Source: Globoforce)


Once-a-year reviews do not accurately capture employee performance. If you cannot remember what you had for lunch last week, how can you expect remember employees' performance throughout the year?


4) Only 3% of organizations say their performance management is top-notch, while 48% say their performance management needs some work. (Source: Clear Company)


If your organization is thinking of revamping your performance management, feel free to reach out to Pavestep for more information!


5) According to a study done by SHRM, managers struggled to complete their reviews on time - as many as 50% of employee’s evaluations were overdue by 30 days or more. (Source: SHRM)


Yikes! Performance reviews can be time-consuming for managers, particularly if organizations expect manager to only assess performance over the year (how will they accurately remember employees' performance). Organizations need to have systems in place that help their managers stay on top of employee performance.


6) 98% of business believe performance management is important, only 64% say they have an effective approach to it. (Source: Willis Towers)


Should we have continuous feedback? How many check-ins should we enforce? Are annual reviews bad? We get it; revamping performance management can be difficult and it can be challenging to know how to start. For the best practices in performance management, check out our Guide to Performance Management for more information!


7) A Deloitte study showed that only 8% of organ­i­za­tions say appraisals add val­ue, and hard­ly any com­pa­nies feel they’re an effec­tive use of time. (Source: Deloitte)


If traditional performance reviews aren’t working for employees - why are organizations still using something that isn’t working, and why can’t they change? Truth is, there is mounting evidence that the modernized performance management systems, such as continuous feedback, are better than traditional systems. While executives and HR departments are debating whether to revamp their performance management system, their employees have already started looking for new jobs and their top peers are moving ahead. If companies do not think their current system is a good investment of time, it is time to act!


8) 70% of companies said there should be a stronger link between performance management and other talent considerations. (Source: Clear Company)


How are talent decisions being made if not taking into account employee performance? Organizations need performance management systems that allow for better training and talent decisions.


9-10) 80% of Gen Y said they prefer on-the-spot recognition over formal reviews. (Source: Linkedin) 63% of Gen Z said they want to hear timely, constructive performance feedback throughout the year. (Source: Cision)


New generations are populating the workforce, and they do not like once-a-year-assessments. Organizations need to adapt to this new generation of work which includes adding continuous feedback and recognition into performance management practices.


11) Only about 50% of the workforce strongly feels as though they understand work expectations. (Source: Clear Company)


Communicating employee expectations should be top priority for an organization. It hard tough to evaluate employee’s performance if they are unsure what they should be doing in the first place. Effective performance management starts with clearly communicating expectation and objectives.



Employee engagement statistics

12) 71% of managers feel employee engagement is one of the most important factors in overall organizational success. (Source: FastTrack)


It shouldn't be a surprise that if employees are more engaged in their work, they are more likely to produce high-quality work. Employee engagement is key!


13-14) Low employee engagement cost companies $450-500 billion each year. (Source: The Conference Board) Companies with a highly engaged workforce are 21% more profitable. (Source: Gallup)


Not only can lack of employee engagement cause organization time and effort, but the cost they spend to replace employees can be detrimental. And employee engagement doesn't have to be costly: feedback and recognition are cost effective ways to boost employee engagement.


15) 25% of employees leave organizations due to lack of recognition (Source: Bureau of Labor Statistics)


An easy way to make employees head for the door is not valuing their work. Who wants to work for an organization that does not value them? A simple 'thank you' can go a long way.


16) Highly engaged business units achieve 59% less turnover. (Source: Gallup)


Employee engagement can do more than make sure the employees are happy in the workplace, but it can have a big impact on the actual success of the company. If employees are engaged, they are likely motivated to improve their skill sets which can translate to a successful organization and improve retention down the line.


17) Employees who feel their voices are heard are 4.6 times more likely to feel empowered to perform their best work. (Source: Forbes)


Employee engagement is hard to have when you are not giving employees the opportunity to share their ideas and opinions. If you want your employees to be engaged, you need to encourage them to speak their mind - an easy way to do this, is for managers to seek feedback during their 1-on-1s with employees.


18) 1 in 3 employees cite boredom as a main reason for leaving the workplace. (Source: Korn Ferry Advance)

It is hard for employees to stay engaged at work when they feel they are not being challenged. These younger generations populating the workforce are mostly not afraid to be tested, they want to develop, and organizations need to be able to challenge them to keep them interested.


19-20) Engaged employees are 44% more productive than workers who merely feel satisfied. (Source: Brain & Company) Employees who find passion and purpose at work are more than 3 times as likely to stay with their organizations as those who don’t. (Source: New York Times)


Passion and purpose can be key to employee engagement. Managers needs to understand what keeps their employees motivated.


21-22) 22% of remote workers claim that it is hard to unplug after work. (Source: Buffer) 61% of employees are burnt out. (Source: Forbes)


Work-life balance is important to employees. Organizations should consider setting guidelines that promote a healthy work-life balance. Set up clear protocols on the core hours that employees need to be online, the expected response time, times when team members should not be disturbed, etc. Get rid of lofty expectations; e.g. do not expect employees to answer emails at midnight.


23) Companies with engaged employees had 89% greater customer satisfaction and 50% higher customer loyalty than their disengaged counterparts. (Source: Hay Group)


Engaged employees not only affect the productivity of an organization, but it can affect how customers and clients view operations.


24) The average company’s biggest productivity losses are often caused by less than 20% of employees who are disengaged or “extremely disengaged”. (Source: Emplify)


20%!! This is incredibly high. Think about the time and resources that these companies could have saved if they would have invested in their employees' well-being and found ways to keep them engaged.



Company culture statistics

25-26) 47% of active job seekers cite company culture as their driving reason for looking for work. (Source: HAYS) 15% of job seekers turned down a job offer because of the company’s culture. (Source: Job seeker)


In this war for talent, organizations cannot simply recruit and/or retain their employees solely based on their brand name or salary alone. Corporate culture is starting to become a key factor in an employee's decision on where to work.


27-29) 58% of employees would stay at a lower-paying job if it meant working for a great boss. (Source: Randstad US) 61% of employees cite trust in and with senior management as important to their satisfaction (Source: SHRM) Only 46% of employees say that they have a great deal of trust in their employers. (Source: Cision)


Managers, supervisors, and leaders have a huge impact over shaping the company culture at an organization. They need to prioritize creating a healthy workplace where their employees feel engaged and productive and where their employees can trust their manager.


30) Employees with flexible work options: 48% say their work-life balance is excellent or very good, and 54% have the emotional support they need at work, compared to 36% and 45% for respondents without flexible work. (Source: Flexjobs)


People want flexible work options. As the workplace becomes increasingly digital, it may be time to listen to your employees!


31) Only 39% of employee admit to having passion and excitement about their work. (Source: SHRM)


If employees don’t get excited to come to work, your company culture may be one of the factors to blame. Build great workplaces and make employees feel like they belong.


32) Having a culture that attracts high talent can lead to 33% higher revenue. (Source: Gallup)


Showcasing your culture and how you differ from similar companies can help attract the top talent. People want to work in great workplaces.


33) 95% of CEOs report their organization is empathetic. However, only 50% of employees say their CEO is empathetic. (Source: Forbes)


Behaviors that are expected in an organization need to be role modelled; and this starts at the top. If you claim that your leaders are emphatic, these need to be showcased by your senior management.


34-35) 86% of potential employees would not apply or continue to work for a company that has a bad reputation with former employees or to the public, and 65% would likely leave a job if they felt they were being negatively portrayed in news or social media due to business practices. (Source: Randstad) Receiving a ‘Best Place to Work’ award leads to a 0.75% increase in a company’s stock price. (Source: Team Stage)


How a company is present as well as their workplace can have a lasting effect on employees and the overall success of the organization. Being known for a good place for work can lead to finding and retaining the best talent.


36) Employees who don’t like their organization's workplace culture are 24% more likely to quit. (Source: Builtin)


No one wants to work in a bad workplace environment. Your company culture is important. (Check out our previous article on how to build a great company culture to learn more).



Feedback statistics

37) 4 out of 10 workers are actively disengaged when they get little to no feedback. (Source: OfficeVibe)


Feedback is imperative for development and employee engagement! If you are interested in developing a feedback culture, check out Pavestep. With Pavestep, our clients' are averaging 2-3 feedback a month. Moreover, the average feedback being sent is 470 characters (about 8-12 sentences long).


38-39) 43% of highly engaged employees receive feedback at least once a week as opposed to 18% of low engagement employees. (Source: OfficeVibe) 32% of employees say they have to wait more than three months to receive feedback from their managers. (Source: OfficeVibe)


Employees are wanting more feedback for development. Give them feedback often.


40-41) 45% of employees value feedback from their peers and clients or customers, yet less than 30% said they receive it. (Source: PWC) Only 58% of managers think they give enough feedback. (Source:OfficeVibe)


360-degree feedback allows for employees to receive feedback not only from their managers, but from their peers as well. This can be very helpful when trying to create an accurate picture of an employee’s performance. Check out our 360 feedback software that truly helps develop employees.


42) 92% of respondents agreed with the assertion that “negative (redirecting) feedback, if delivered appropriately, is effective at improving performance”. (Source: Harvard Business Review)


Delivery can have a huge impact on how feedback is accepted by employees. Feedback must be delivered in a way that does not cause employees to become defensive, but instead sees it as a suggestion on how to develop. Check out our previous article on effective feedback.


43-45) 69% of employees say they would work harder if they felt their efforts were better recognized, 78% of employees said being recognized motivates them in their jobs, and 72% of employee get praise less than once a week. (Sources: OfficeVibe)


Feedback provides managers and peers the opportunity to recognize and reward others work. This recognition can not only help employees feel engaged but feel like a valuable part of the team while motivating them to keep producing high-quality work. Recognition doesn’t have to be a raise or bonus, but a simple 'thank you' for doing great on a project can go a long way. If you recognize someone’s performance, be sure to mention it, they will appreciate it more than you think!


46) There are 14.9% lower turnover rates in companies that implement regular employee feedback. (Source: OfficeVibe)


Employees want to know what they are good at and what they can improve on; it’s all part of their development. Implementing real-time, continuous feedback allows for them to regularly improve their skills at your organization. Investing in employee development will make them more likely to remain with their company.


47) Managers who received feedback on their strengths showed 8.9% greater profitability. (Source: Gallup)


Managers need feedback for their own development as well. Managers should ask for feedback during their check-ins with employees. Upward feedback can also be encouraged during formal traditional reviews.


48) Employees are two times as likely to be disengaged if they feel ignored by their managers. (Source: OfficeVibe)


This is a no brainer. Employees want to feel valued. If managers are still not meeting this requirement, it might be time to find a new communication strategy to relay how important feedback and recognition is for employee engagement, motivation, and productivity.


49) More than 85% of all Fortune 500 companies use the 360-degree feedback process as a cornerstone of their overall leadership development process. (Source: Forbes)


The benefits of 360-degree feedback include a more accurate depiction of employee performance, highlights employees' strengths and weakness, and also creates a strong culture of feedback.


50) 83% of employees appreciate receiving feedback, regardless of it being positive or negative. (Source: OfficeVibe)


Feedback is how we improve. Feedback has to be constructive, objective, real-time, and direct & kind to be effective.


What statistic shocked you most? Let us know!