13-05-2025
Rethinking Work Performance Culture: Why Annual Reviews Fail Gen Z
Gen Z at work
The challenges of developing a fair and consistent review process have been well documented, and Gen Z, the first truly digital-native generation to enter the workforce, is having none of it.
Having grown up with instant feedback through likes, comments, and immediate digital responses, Gen Z approaches workplace feedback with dramatically different expectations than previous generations. Unlike Baby Boomers who often see performance reviews as formal evaluation tools, or Gen X who value autonomy in feedback, Gen Z craves frequent, personalized guidance focused on growth rather than judgment. Failing to account for these dramatic differences in expectations can negatively impact company culture, increase employee burnout, and stifle engagement.
But forward-thinking leaders are finding new ways to meet the challenge. Here's how.
Annual, backward-looking, manager-driven evaluations are poorly suited for today's knowledge economy, where roles evolve rapidly and innovation requires constant adaptation. For Gen Z specifically, waiting months for feedback feels alien and disengaging. A generation accustomed to immediate responses on digital platforms finds traditional annual reviews particularly frustrating and inauthentic.
Recognizing this reality, we saw a shift away from annual review processes about a decade ago. Interestingly, the pendulum now appears to be swinging in the other direction, with companies like Microsoft, which famously abandoned its "stack ranking" system in 2013, reinstating forced competition. Whether others follow suit remains to be seen.
But contrary to being coddled, Gen Z wants to take charge of their own development. Research from Gartner highlights a telling statistic about Gen Z's self-sufficiency mindset: 38% of Gen Z would abandon resolving an issue if they couldn't do it themselves through self-service, compared to only 11% of Baby Boomers. This preference for independent problem-solving extends to how they approach feedback—they want accessible tools and resources for self-development, not just manager judgment.
Additionally, Gen Z employees tend to be more vocal than previous generations about perceived unfairness and particularly alert to systematic biases, which can plague performance review processes, and far more likely to disengage from systems they think are unfair.
To create a performance management process that actively engages Gen Z while strengthening organizational culture, companies must embrace real-time feedback mechanisms and immediate, relevant guidance. Consider these five essential elements:
Replace annual reviews with weekly or even daily digital touchpoints. Gen Z expects the same immediacy in workplace feedback that they experience on social platforms. Design brief check-ins using messaging apps or collaboration tools they're already comfortable with. Train managers to use concise, specific language and to provide instant recognition through digital channels when Gen Z employees achieve goals or demonstrate growth. Implement pulse surveys that feel more like Instagram polls than formal evaluations to gather their insights regularly.
Gen Z places significant value on peer opinions and community input. Develop processes that gather feedback horizontally rather than just vertically from management. Create collaborative evaluation processes where Gen Z team members can solicit and receive input from colleagues across departments. Encourage them to build their personal "feedback network," empowering them to seek growth insights from multiple sources rather than relying solely on managers.
Gen Z sees professional development as an extension of personal growth. Structure conversations around skill-building that connect to both career aspirations and personal values. Help Gen Z employees identify development opportunities aligned with social impact causes they care about. Create customizable learning pathways that allow for personalization rather than standardized development plans. Regularly connect their daily work to broader purpose and meaning, which Deloitte research confirms is central to Gen Z's workplace satisfaction.
Implement technologies that allow Gen Z to track their progress rather than waiting for manager evaluations. Select platforms that gamify skill development with visible achievement markers. Provide AI-powered assessment tools that offer immediate, objective feedback on their work. Enable self-comparison features that let them benchmark their growth against anonymized peer data. Prioritize mobile accessibility for all performance tools, as Gen Z expects workplace technologies to function like the apps they use in their personal lives.
While separating development from compensation decisions remains important, Gen Z demands unprecedented transparency in how reward systems work. Document and communicate the specific metrics and benchmarks that influence compensation decisions. Provide data visualizations that illustrate the relationship between performance and rewards across the organization. Engage Gen Z in reshaping compensation structures to better reflect their values around fairness, purpose, and work-life balance. Importantly, recognize that these employees are highly transparent when communicating with one another on issues of compensation.
The foundation for effective performance management with Gen Z is psychological safety that honors their commitment to authenticity and transparency. Unlike previous generations who might compartmentalize critical feedback as "just business," Gen Z approaches work as an integrated part of their identity. By replacing traditional annual reviews with continuous, purpose-connected feedback systems, companies can create cultures where Gen Z employees feel valued, challenged, and authentically seen.
