How performance management should change in 2025, according to HR

It’s nearly the most wonderful time of the year *checks notes*: Performance review season, a time that managers and individual contributors alike cherish dearly. (In case it’s not clear, we’re being sarcastic.)

While the annual performance review cycle has remained status quo for many companies, advancements in AI and employees’ interest in more frequent feedback have prompted some people teams to rethink the process.

HR leaders shared with us how they’d like performance management to evolve in the year ahead.

Don’t depreciate managers. “A trend I’d like to leave behind in 2024 is the devaluation of management roles. Between the ‘conscious unbossing’ trend—or Gen Z’s growing reluctance to take on management roles—and Silicon Valley embracing ‘founder mode’ over ‘manager mode,’ 2024 headlines painted management as an undesirable career path. Yet, organizations that underestimate the importance of middle management do so at their own peril. They risk a leadership pipeline crisis, threatening long-term stability and growth…To reverse anti-management trends, organizations first need to invest in more meaningful leadership development for manager-level employees.”—Stephanie Neal, director, DDI’s Center for Analytics and Behavioral Research

Look out for leadership qualities. “In 2024, especially due to a lack of talent in certain industries, we saw too many companies promoting based on technical skill rather than leadership ability. These are different skill sets, and excelling in a technical role doesn’t always translate to success in management or leadership. Instead, focus on people who have potential for leadership, interest in leadership training, have strong rapport with co-workers, or have demonstrated potential outside of their primary role by showing a desire to advance their skillset.”—Shannon Gabriel, VP of leadership solutions practice, TBM Consulting Group

Consider how AI will disrupt the traditional career path. “Technology is evolving faster than ever and employers need to think carefully about the impact it will have on jobs and career growth—especially when we think about how AI and agents are transforming the way we work. Employees tell us they want to use new technologies like AI and agents at work. In fact, 90% of Salesforce employees say they like to experiment with new technology, and 82% see the benefits of technological advances to their work, according to our most recent survey…AI and agents can make it easier for employees to embrace learning and collect diverse and relevant skills, expertise, and job experience to position us for the future.”—Lori Castillo Martinez, EVP of talent growth and development, Salesforce

Ditch the old-school performance reviews. “I’d like to see the traditional, rigid approach to annual reviews finally left behind. Today’s workforce wants ongoing growth and real-time feedback—not an end-of-year assessment that’s often too late to be impactful. Instead, a continuous performance enablement model aligns much better with both employee needs and business goals. This approach prioritizes flexible goal-setting, regular check-ins, and decoupling compensation from performance reviews, allowing feedback to focus on skill development and long-term growth.”—Jamie Aitken, VP of HR transformation, Betterworks

Invest in real mentoring. “Let’s say goodbye to superficial mentor relationships in 2025. So many companies have great intentions when it comes to mentoring, but most programs aren’t hitting the mark. Why? Because a lot of mentor relationships are surface-level and tend to lack real substance. Time is so limited. We’re all busy, and it’s tough to squeeze in coffee chats and virtual connects—especially if those conversations are one-sided, inauthentic, or uninspiring. To solve this, companies can create targeted mentorship programs—ones that are specific to their company culture and directly reflect the needs of their employees.”—Kelly Baker, CHRO, Thrivent