11 Companies with Best Performance Management Practices Building Exceptional Teams

"We need to empower individuals, empower teams, and put the individual at the center of efforts to drive company performance and employee happiness," says Laszlo Bock, Humu CEO and former Chief HR Officer at Google.

People performance management plays an essential role in an organization's success. Yet, only 14% of employees strongly agree their performance reviews motivate them, according to Gallup.

So, what can you do to ensure your company's performance management approach motivates and inspires your people and drives their productivity?

In this article, you'll:

• Learn from 11 companies with the best performance management practices today, from innovative feedback systems to culture-centric approaches.
• Better understand how their specific strategies and methodologies can boost performance management in your organization.

From these leading examples, we'll gain insights into creating more engaging and effective performance management systems that align with your company's goals and foster employee growth and satisfaction.

🎯 11 Examples of companies with exceptional performance management

Companies that successfully manage employee performance take their performance management systems to the next level.

Let's look at how they do it.

Deloitte

"If you want people to talk about how to do their best work in the near future, they need to talk often ... we have found in our testing a direct and measurable correlation between the frequency of these conversations and the engagement of team members." Marcus Buckingham and Ashley Goodall, performance management industry experts.

Deloitte's performance management approach is characterized by its frequent, holistic, and growth-focused framework. It emphasizes routine performance snapshots and regular check-ins, departing from traditional performance management paradigms that hinge on infrequent annual reviews and backward-looking assessments.

Deloitte's approach features:

• Frequent feedback—Deloitte's regular feedback approach is a departure from the annual performance review process it previously adopted. Deloitte treats performance management as a continuous development process, emphasizing real-time feedback and meaningful development conversations.
• Future-focused—Deloitte's process focuses on future potential rather than past performance. It explores the more adaptable and developmental aspects of career growth.
• Simplified process—Deloitte reduced the complexity of its former approach by introducing short surveys designed to capture the feelings and intentions of its people and their managers, going beyond the traditional emphasis on skills and competencies.

➡️ Looking to inspire your people through honest and helpful discussions? Check out these insightful development conversation questions.

Deloitte's performance snapshots and check-ins are augmented by surveys, talent reviews, and other activities geared toward understanding employee motivations and improving future performance.

What Deloitte's performance management approach offers:

• For its people—Deloitte's people get timely feedback and guidance on their future performance and career growth, emphasizing their strengths rather than their weaknesses.
• For Deloitte—The process nurtures a more engaged and agile workforce that is responsive to change and more aligned with organizational goals, fostering a high-performance culture.

➡️ Learn how Deloitte manages its people's performance using a frequent and holistic approach that's focused on growth

Microsoft

"What we really value is three dimensions. One is your own individual impact, the second is how you contributed to others and others' success, and the third is how you leveraged the work of others.[...] We're really recognizing people who were driving impact but were enabling others' success as well as leveraging others, in the spirit of 'One Microsoft.'" Kathleen Hogan, Chief People Officer at Microsoft.

Microsoft's performance management system highlights continuous feedback and collaboration through its "Connects" program. It's built around regular, bi-monthly discussions between managers and their people, focusing on 360-degree feedback, shared core values, and inclusion.

Microsoft's approach features:

• Ongoing development—Regular feedback and interactions support continuous employee development and alignment with organizational goals.
• Collaboration—Microsoft emphasizes peer feedback and shared values, fostering a supportive culture that advocates a connection with the organization and its people.
• Inclusivity—The employee performance review process has inclusivity at its core, promoting diversity and equity as integral to the company's culture.

What Microsoft's performance management approach offers:

• For its people—Microsoft's approach gives their people a more holistic view of their contributions, leveraging peer support and fostering a sense of belonging and inclusion. It also provides more timely and relevant feedback that supports people's professional development.
• For Microsoft—The approach promotes a more cohesive and engaged workforce, drives innovation, and aligns employee goals with Microsoft's strategic objectives.

➡️ Discover how Microsoft's approach to employee performance reviews drives outcomes by placing collaboration and inclusivity at its core.

Zappos

"If you get the culture right, most of the other stuff will just take care of itself." Tony Hsieh, late CEO of Zappos.

Zappos builds its performance management system around autonomy, trust, growth, and learning. Its approach exemplifies Zappos' commitment to an egalitarian culture as a foundation for performance and growth.

Unlike many organizations, Zappos doesn't box its employees into pre-defined roles and categories that stifle growth. Instead, Zappos' approach to employee performance management encourages ambition and mobility through upskilling and personal evolution.

Culture is at the heart of Zappos' everyday performance management philosophy, promoting fun, creativity, and interaction in a relaxed environment that celebrates employee empowerment.

Zappos' approach features:

• Holistic development—Zappos emphasizes personal and professional growth to promote better employee engagement and a more comprehensive development approach for its people.
• Alignment with core values—The performance management system is designed to reflect and reinforce Zappos' core values, such as autonomy and trust so that its people's growth and performance align with Zappos' organizational values.
• Autonomy and trust—Zappos has shifted toward a more continuous feedback and peer-driven system, empowering its people with increased ownership and responsibility.

What Zappos' performance management approach offers:

• For its people—Zappos' people benefit from a supportive environment that values their personal goals and encourages them to upskill, resulting in better job satisfaction and personal fulfillment.
• For Zappos—Zappos' culture-centric approach results in a more loyal and engaged workforce with low employee turnover, fostering a strong company culture that underpins the company's success.

➡️ Curious about performance management systems that feature culture as a focal point for growth? Check out Zappos' approach to performance reviews, promoting autonomy and trust as foundations for personal and professional development.

Adobe

"At a company that has talent as its currency essentially, the check-in approach is the way for that talent to continuously optimize itself." Donna Morris, former Chief HR Officer at Adobe.

Like Deloitte, Adobe has adopted a more dynamic and continuous check-in process over traditional annual performance reviews. Adobe considers this a way to improve performance management through regular, informal feedback and development discussions between managers and their people.

Adobe's emphasis on frequent, informal feedback characterizes a more responsive and agile performance management process. Its check-in approach incorporates a 3-tier framework—goals and expectations, feedback, and development—and defines guidelines for each element of this framework in a check-in toolkit.

Adobe's approach features:

• Continuous development—Frequent check-ins ensure that Adobe's people benefit from ongoing development and timely feedback, helping them define actionable goals that adapt to their career and learning paths.
• Emphasis on employee engagement—Regular interactions between employees and managers facilitate a more engaged and motivated workforce and better communication around strengths, training needs, and areas for improvement.
• Alignment between goals and expectations—More frequent discussions help align employee goals with company objectives, clarifying the purpose and context of people's objectives and how they fit with Adobe's priorities. While managers drive the expectation-setting process, employees are responsible for setting and monitoring goals that align with expectations.

➡️ Make the most of your people conversations with these one-on-one meeting templates and one-on-one meeting questions.

What Adobe's performance management approach offers:

• For its people—Regular feedback and guidance support professional growth and job satisfaction. Adobe's approach to performance appraisal also allows more immediate recognition of people's achievements while facilitating timely corrections when an employee's career path is misdirected.
• For Adobe—Adobe's performance management system leads to a more adaptable and high-performing workforce while allowing more efficient performance reviews by eliminating lengthy annual review processes.

➡️ Learn how Adobe uses check-ins to provide more timely, adaptable, and growth-oriented performance reviews for its people.

Spotify

"Our performance development approach is a combination of looking at performance to see what is needed for the company to reach the goals we set up and looking at the development of our people. We believe you can't really separate the two." Johanna Bolin Tingvall, L&D (Greenhouse) at Spotify.

Spotify adopts a unique people structure that groups its employees into self-organizing, agile teams called "squads." Each squad comprises 8 or fewer members and is responsible for a specific area of Spotify's products and operations. Squads have a high degree of autonomy in achieving their goals and interact with each other using "tribes" and "chapters."

Performance management at Spotify leverages its squad framework by requiring chapters to facilitate learning and competency development across squads. In addition, there's a Greenhouse learning portal for topics not covered in chapters.

Spotify's performance management system uses squad reviews, employee reviews, and an internal talent marketplace called Echo.

Spotify's approach features:

• Continuous learning and development—Working through its unique framework, Spotify's system fosters continuous learning. It helps employees with individual career development and growth.
• Flexibility and autonomy—Using tools like Echo, Spotify empowers its people by giving them a high degree of flexibility and autonomy within squads.
• Holistic employee growth—Spotify's system goes beyond traditional performance metrics. It emphasizes mastery, achievement, and behavior as three key components of its people's performance and development.

What Spotify's performance management approach offers:

• For its people—Spotify's performance management framework offers a supportive environment and facilitates personal and professional growth. This leads to higher job satisfaction and better opportunities for career advancement at Spotify.
• For Spotify—Spotify benefits from a highly adaptable, innovative, and engaged workforce as a result of its system, fostering a strong culture and promoting organizational success.

➡️ See how employee performance reviews at Spotify leverage its unique organizational structure to promote learning, autonomy, and innovation.

Google

"[OKRs are] a great way to help everyone in the company understand what's important and how you're going to measure what's important. It's essentially a great way to communicate strategy and how you're going to measure strategy." Richard Costolo, former Product Manager at Google.

Google conducts its performance reviews using OKR goal-setting (i.e., Objectives and Key Results), employee satisfaction surveys, regular performance check-ins, annual feedback surveys, and annual reviews to help finalize decisions.

Setting OKRs is a key element of Google's approach. The OKR methodology is a goal-setting framework for defining and tracking objectives and outcomes. It emphasizes measurable and ambitious goals that drive performance and organizational productivity, promoting transparency, alignment, and engagement.

Google's approach features:

• Alignment and clarity—Google's OKRs keep its people on track with strategic organizational objectives by providing a clear direction and focus. OKRs are visible to everyone at Google (through an internal website), encouraging high transparency and alignment. They are frequently discussed between Google's leaders and their people in one-on-ones.
• Ambitious goal-setting—Google's OKRs are set to be successful if around 70% of the objectives are met. It's regarded as an extraordinary performance if all the objectives are met. This ambitious approach to goal-setting fosters a culture of striving for excellence and continuous improvement.
• Transparency—The visibility of OKRs across Google promotes a culture of openness and accountability while guiding employees on how their work contributes to Google's success by having a clear depiction of not only their goals but also the goals of their colleagues and leadership.

What Google's performance management approach offers:

• For its people—Google's people benefit from a clear understanding of what's expected of them and how their work contributes to Google's objectives. This clarity leads to higher engagement and motivation.
• For Google—Google's approach leads to a more focused and aligned workforce, driving innovation and efficiency and helping to identify high performers and those needing improvement.

➡️ Discover how performance reviews at Google use a highly transparent and engaging approach to set goals and drive success.

Cisco

"We now believe that teams will characterize the future of work and that the only way to build a great company is to pay attention to the collective. Ashley Gooddall, former SVP of Leadership and Team Intelligence at Cisco.

Cisco differentiates its performance management process by successfully combining data-driven and human-centric elements toward nurturing excellence in teams. Cisco believes this focus on teams helps build a culture of interaction, feedback, and engagement.

Cisco has developed a proprietary technology, Team Space, to coordinate its performance management process across its vast workforce over multiple countries and cultivate culture at a local level within each team. Cisco's approach emphasizes the power of teams in unlocking value at the company level and enabling individual potential.

Cisco's approach features:

• High-performance cultivation—Cisco's focus on performance management at a team level creates an environment that prioritizes collective success and leads to higher overall performance.
• Data-driven insights—Team Space and other proprietary technology facilitate efficient data collection on team performance and individual employee progress, informing decisions on pay, promotions, and development.
• Continuous improvement—Cisco's performance management process encourages teams to evolve and improve continuously, aligning individual aspirations with Cisco's innovative and forward-thinking culture.

What Cisco's performance management approach offers:

• For its people—Cisco's people benefit from a supportive team environment that values individual strengths and contributions, leading to higher job satisfaction and personal fulfillment.
• For Cisco—The approach results in more cohesive, innovative, and high-performing teams. It also fosters a strong company culture, which is synonymous with Cisco's ethos and helps to drive its brand success.

➡️ See how performance reviews at Cisco leverage the power of teamwork to drive a data-rich, tech-savvy, and high-performance approach to people development.

Netflix

"If a person on your team were to quit tomorrow, would you try to change their mind? Or would you accept their resignation, perhaps with a little relief? If the latter, you should give them a severance package now and look for a star, someone you would fight to keep." Reed Hastings, Executive Chairman, former CEO, and co-founder of Netflix.

Netflix places people and teams at the heart of its performance management philosophy—employees achieve their goals by measuring results, recognizing the team context, valuing different perspectives, and taking action where necessary to improve performance.

Netflix doesn't use traditional performance reviews. Instead, they opted for 360-degree feedback as a more holistic, multi-faceted, and comprehensive performance management approach.

This approach supports a high-performance culture where feedback is continuous and direct and fosters individual and collective growth.

It also uses a "Keeper Test" rather than a traditional rating system to develop a sense of responsibility and autonomy. The Keeper Test is a brutally honest approach to differentiating high-performing employees from those who don't contribute well.

Reed Hastings, the former CEO of Netflix, describes Netflix's performance culture as more akin to a champion sports team, whereby each player needs to be in top form rather than an environment in which poor performance is tolerated.

Netflix's approach features:

• 360-degree feedback—Netflix uses 360-degree feedback to garner insights from an employee's peers, direct reports, managers, and leadership to form a complete and overarching view of performance.
• The Keeper Test—The Keeper Test asks managers to consider whether they would fight to keep an employee during a crisis, serving as a "litmus test" for gauging an employee's contribution.
• Candid insights—Netflix fosters a culture where honest and direct feedback is encouraged, supporting a transparent and high-performing work environment. Netflix adopts guidelines for giving and receiving feedback, emphasizing principles such as giving actionable feedback and appreciating the received feedback.

What Netflix's performance management approach offers:

• For its people—Netflix's people receive diverse perspectives on their performance, which aids their professional development. The clear and direct feedback culture also helps them easily understand their strengths and areas for improvement.
• For Netflix—The approach promotes top-performing team players, driving innovation and excellence. It also streamlines the performance management process and better aligns it with Netflix's dynamic and fast-paced environment.

➡️ Learn from Netflix's approach to performance reviews that promotes holistic feedback and a commitment to a high-performing culture.

Facebook (Meta)

"[The performance review] is a process that is designed to recognize, acknowledge, and show appreciation for people who have done really great work. And it's designed to ensure that you are getting feedback from all of the people that you work with most regularly." Lori Goler, Head of People at Meta.

Facebook, Meta from October 2021, retains some elements of a traditional performance management system: highly structured and uses a formal performance review process, including self-assessments within a 360-degree review framework.

Meta's approach features:

• 360-degree reviews and calibration—A comprehensive review process where employees receive feedback from peers, direct reports, and managers, followed by calibration to ensure fairness and consistency.
• Structured rankings—Employees are assessed using a seven-point scale, from "Redefine" to "Does not meet," to help differentiate performance levels.

Meta's 360-degree framework captures the following for each employee:

• A thorough self-assessment that asks employees to evaluate their contribution over the year and how they could increase their contribution
• Reviews from up to five peers assessing the employee's judgment (their ability to make effective business decisions), execution (their consistency, quality, and reliability with doing tasks), risk management approach, and ability to upskill (their learning and development)
• Ratings evaluations by the employee's managers and leaders that have consequences for the employee's future progress (e.g., promotions or dismissals)
• Performance calibration, during which team managers discuss the findings of the review process and assign one of seven grades

➡️ Super-charge your performance review discussions with these performance review templates and constructive performance review questions.

What Facebook/Meta's performance management approach offers:

• For its people—Meta's people receive diverse and comprehensive feedback, which helps them grow professionally. At the same time, the clear ranking system is transparent and helps them understand where they stand regarding their performance.
• For Meta—The approach encourages a high-performance culture in which employees are motivated to excel and contribute to the organization, supported by a calibration system that promotes fairness and reduces potential biases.

➡️ See how Facebook uses performance reviews to provide comprehensive feedback and drive a high-performing culture underpinned by a transparent and straightforward rating system.

Accenture

"Replacing traditional appraisal reviews with frequent, high-quality feedback and forward-looking career discussions for each individual will yield better outcomes for our people and for the business." Ellyn Shook, Chief Leadership and HR Officer at Accenture.

With a workforce exceeding 730,000, Accenture has a mammoth task in managing its people's performance. Its old performance review system was tedious, time-consuming, and infrequent. Given the pace and demands of Accenture's workforce, it was unproductive and tardy.

Accenture addressed this by transitioning to a real-time, frequent, and forward-looking approach that gives people timely and helpful feedback.

Accenture's approach features:

• Continuous feedback—Rather than annual reviews, feedback is periodic, keeping pace with projects and activities in smaller chunks that are timely and easy to digest
• Future focus—Accenture's performance reviews focus on future skills and career development, treating challenges as opportunities for growth and promoting a culture of innovation
• Alignment—Each employee is recognized as unique at Accenture, warranting personalized, relevant objectives that are consistent with Accenture's organizational priorities

What Accenture's performance management approach offers:

• For its people—Real-time feedback that gives timely guidance and prioritizes future growth, emphasizing career progression based on individual skills and contributions.
• For Accenture—An efficient and productive approach that empowers Accenture's people to produce better outcomes through a more engaged and motivated workforce.

➡️ See how Accenture revolutionized its performance management approach toward a more dynamic, continuous, and holistic system.

Taktile

"Feedback, for us, is a key value. And it's what makes us able to grow as a company in such a critical stage." Valeria Rosati, HR Operations Lead at Taktile.

B2B SaaS startup Taktile differs from the other organizations discussed in this article. Rather than being an established business with a stable workforce and legacy performance management system, Taktile is a fast-growing company experiencing the challenges of a rapidly expanding workforce without the benefit of long-established systems and processes.

It was paramount for Taktile to find an adaptable performance management solution that could grow with its ambitious business plans. Taktile needed to move beyond "on the spot" HR processes with two of its most pressing areas being onboarding and feedback.

Taktile responded by developing a structured feedback process that leverages technology (using Zavvy) and integrates feedback cycles with the employee lifecycle. It caters to each employee's journey and is customized to their start dates and roles.

Taktile's approach features:

Structured feedback cycles—Taktile's structured feedback applies at various stages of an employee's journey, including preboarding, onboarding, and bi-yearly performance reviews. This systematic approach ensures continuous and consistent feedback.

Alignment with development goals—Taktile's feedback aligns with employee development goals set during onboarding, ensuring the input is relevant and actionable.

What Taktile's performance management approach offers:

• For its people—Taktile's people receive regular, structured feedback that's relevant to their roles and development goals and is an integral part of their experience. They clearly understand their progress and areas for improvement and are encouraged to grow personally and professionally.
• For Taktile—The approach promotes a culture of continuous growth. It helps to identify areas where Taktile can support its people in achieving their goals, leading to higher engagement and retention.

➡️ Discover how fast-growing startup Taktile uses structured feedback to run a customized and adaptable performance management system for their rapidly expanding workforce.

🏆 5 Tried and tested best practices from these 11 companies

The exceptional approaches to performance management that we've considered in these 11 examples are characterized by:

1. Frequent, holistic feedback—Organizations are moving away from infrequent feedback and limited channels of communication toward regular check-ins and multi-dimensional feedback, e.g., Microsoft's Connects program and Netflix's 360-degree feedback approach
2. Focus on future development and growth—Forward-looking conversations and aspirational goals help employees focus on development and growth, while organizations benefit from a better engaged and more motivated workforce, e.g., Deloitte's focus on future potential (rather than past performance) and Google's ambitious OKR goal-setting
3. Collaborative and engaging process—By ensuring that all employees feel valuable and make a meaningful contribution, organizations foster a supportive culture that boosts trust and motivation, e.g., Cisco's focus on a team approach to delivering excellence and Zappos' peer-driven, culture-centric framework.
4. Aligned—Goals that are aligned with organizational objectives provide better clarity and purpose for employees, e.g., people setting their own goals (based on manager expectations) at Adobe, promoting accountability and consistency with organizational objectives
5. Flexibility and autonomy—Greater autonomy empowers people to bring their best to work. It gives them a strong sense of ownership over their outcomes, e.g., Spotify's self-organizing and agile squads.

➡️ Get inspired by the performance management best practices adopted by some of the most successful organizations on the planet!

➡️ Zavvy: Where top companies' practices meet innovative technology

Zavvy has cutting-edge tools that utilize the latest research and most successful performance management principles and practices. They can help you streamline, refine, and elevate your performance management system to levels on par with the best in the world.

Frequent, holistic feedback

🤫 Get candid feedback from your people using Zavvy's anonymous feedback tool, allowing you to run a variety of anonymous surveys using thoughtfully curated templates.

🔁 Assess leadership, performance, and career progression using 360-degree feedback software to garner multi-faceted insights and inspire action.

📊 Run world-class performance reviews with software that leverages 360-degree feedback to provide fair, transparent, and customizable reviews.

Future-focused development

🎯 Align your people's objectives using goal management software to craft OKRs that are clear, consistent with your organization's priorities, and easy to track.

🧮 Focus on your people's skills and develop them strategically using Zavvy's skills matrix software.

🌟 Measure, manage, and train your people's competencies using software to create role clarity, run effective feedback reviews, and receive constructive training suggestions.

Alignment

💬 Drive alignment and accountability using a structured approach to one-on-one meetings, incorporating pulse questions, collaborative agendas, action item tracking, and private follow-up notes.

📅 Book a free 30-minute demo to see how Zavvy can help you establish the world's best performance management practices at your organization.