From performance management to performance development: What helps leaders succeed – News Channel 3-12

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Organizations have spent years redesigning performance processes to support employee development, strengthen talent decisions and improve business performance. The harder challenge is helping leaders consistently commit to those processes amid competing priorities.
Performance management now asks leaders to provide ongoing coaching, support employee development, document performance throughout the year and connect individual contributions to business outcomes.
Recent research points to continued shift from annual reviews toward continuous feedback, from annual goals toward shorter-term objectives, from objectives set by leaders toward co-creation of goals, and from evaluating past performance toward supporting future development. However, better outcomes have not always followed. 
Only one in five employees feel motivated by their company’s performance management system, and only 32% of executives believe their system enables high-quality talent decisions, according to May 2025 research from Cornell University’s Center for Advanced Human Resource Studies.
The shift towards continuous feedback reflects a broader recognition that employees develop through everyday work, not annual review cycles. Many performance processes, however, still require leaders to reconstruct months of activity after the fact instead of supporting development as work progresses. 
Getting performance development right is critical to strategic execution. In this article, BDO discusses how organizations can reap the benefits of this approach, with success hinging on practical support for leaders in three key areas.
 
Organizations should give senior leaders a clear framework for setting expectations around performance development and demonstrating those behaviors within their own teams. They should also define the actions that show a leader is developing others and incorporate those expectations into leadership evaluations.
Specific leadership behaviors include setting priorities, providing timely feedback, regularly discussing development, following through on commitments and creating opportunities for two-way feedback. 
Companies participating in a 2025 Cornell University working group emphasized the importance of giving employees clear, robust goals and priorities as a starting point for effective performance management. Leaders are more likely to model development behaviors when expectations are clear, reinforced consistently, and reflected in the evaluation of their own performance. 
Cornell’s Center for Advanced Human Resource Studies identifies individual goals, KPIs and project deliverables as traditional performance measures and points to collaboration, teamwork, customer value, employee learning and development, well-being and engagement as emerging dimensions of performance.
Technology can connect these additional dimensions with traditional performance measures across systems, giving leaders a more complete view. With better visibility into progress, patterns and emerging gaps, leaders can coach, develop and evaluate employees more effectively and address concerns before the formal review cycle.  
AI tools can support that effort. A May 2026 Harvard Business Review article suggests that generative AI’s greatest value to performance reviews may be helping leaders unearth evidence of employees’ decision-making, influence, mentoring and problem-solving from everyday work, providing a stronger basis for coaching, development and talent decisions.
Organizations that were part of Cornell’s working group described using AI platforms to help managers track performance, manage the review cycle, and identify areas for employee improvement, while emphasizing that these tools cannot replace manager-employee conversations. 
Support for leaders should be built into day-to-day workflows, so performance development does not become another task on an already crowded agenda.
The same Cornell working group identified transparency, trust and a safe environment for giving and receiving feedback as important conditions for successful performance development. Participating companies were also connecting frequent feedback with the broader review process, though consistent use depended on keeping the system simple and easy for managers to adopt. 
Cornell’s research highlights persistent challenges, including time-consuming processes, feedback arriving too late and difficulty capturing individual contributions. It also revealed that gaps in managers’ coaching and feedback capabilities further weakened performance development efforts. 
Organizations can address these challenges by helping leaders build coaching capabilities, establishing expectations for ongoing two-way dialogue between leaders and employees, and simplifying performance processes. Feedback captured throughout the year should flow into the annual performance cycle, allowing ongoing conversations to replace end-of-year reconstruction. 
Performance development depends on what leaders do every day. Clear examples of what success looks like, better information and simpler processes make that job easier and help turn development conversations into opportunities for employee growth, stronger talent decisions and better business outcomes. 
This story was produced by BDO and reviewed and distributed by Stacker.
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