Performance Reviews: Why They Matter and How to Get Them Right
Executive Insights Digest #34: Performance Review Part One
Many tech and gaming companies downplay or even ignore formal performance evaluations, viewing them as bureaucratic or antithetical to “creative” culture. A survey by StaffCircle found over 1 in 5 organizations (21%) admit they have no performance management process at all, a gap that can severely hinder feedback and development. The same survey revealed 73% of Gen Z employees are more likely to leave if they don’t receive frequent feedback, compared to about half of older employees, underscoring how new generations in tech expect regular, structured input from their leaders.
Why are performance reviews so vital? They create a reliable cadence for feedback and coaching, beyond the ad-hoc conversations that happen in daily work. In gaming and IT, roles are often highly specialized, and projects are complex and interdependent. A formal review process forces busy managers to take a step back from the urgent deadlines and focus on each individual’s development, accomplishments, and challenges over a period of time. When done well, reviews tie individual efforts to broader company goals, helping technical teams see the bigger picture and how their work contributes to product success or user satisfaction.
Performance reviews, also known as appraisals or assessments, are fundamentally about providing feedback that helps employees grow. Research shows that when done right, reviews can improve communication, strengthen engagement, and boost job satisfaction. In an industry defined by problem-solving and continuous learning, a culture of continuous feedback is a competitive advantage – it keeps skills sharp and innovation on track.
Leaders should also recognize the risk of relying solely on informal feedback or infrequent, gut-feel judgments. Without a structured review system, promotions and raises in tech companies may be driven by office politics or the loudest voices rather than merit. In environments with no reviews or clear feedback loops, career progression can feel arbitrary: employees might get only terse reactions like “don’t screw that up again,” and promotions seem to “magically” occur without explanation – leaving staff in the dark about how to advance or why someone else was chosen.
In short, formal performance reviews are not bureaucratic red tape – they are a foundational practice for sustaining growth, agility, and talent retention.
The Issues Without a Performance Review Process
What happens when a gaming studio or tech firm has no structured performance reviews or feedback process? In a word: misalignment. Without a formal system to set goals and evaluate progress, even talented teams can drift off-course. Employees are left guessing how they’re doing or what the company really values. Several pernicious issues tend to arise in the absence of performance reviews or a similar feedback mechanism:
Unclear Expectations and Goal Misalignment: If leaders never sit down to discuss performance, individuals may not know whether their focus is aligned with the team’s needs. Particularly in startups or small studios, people wear multiple hats – without a review, they might pour energy into tasks that their manager doesn’t deem top priority. Over time, the company risks everyone rowing in different directions.
Lack of Feedback and Stagnant Performance: Humans generally avoid difficult conversations. In the absence of a scheduled review process, many managers will default to giving little to no feedback, especially if an employee is not outright failing. Minor performance issues get swept under the rug until they snowball. Skills development stalls because strengths aren’t reinforced and growth areas aren’t addressed. Regular reviews set a minimum frequency for feedback so nobody goes more than a certain period without focused performance discussion.
Surprise and Anxiety in Career Progression: With no performance evaluations, promotions and raises can appear highly arbitrary. Employees are left in the dark about what it takes to advance. They might only discover a performance issue when they’re passed over for promotion or removed from a project, and at that point, it feels like an ambush. Talented staff, especially those early in their careers, understandably find this frustrating and demotivating. Top performers may eventually jump ship to companies with clearer growth paths.
Manager Bias and Perceived Unfairness: In the absence of structured reviews, decisions about rewards and promotions are left entirely to managers’ discretion, which opens the door to bias and favoritism. Busy managers may fall back on their subjective impressions or personal affinities when evaluating who deserves opportunities. This can erode trust if employees perceive the system as unfair. Without a formal review framework, there’s little accountability or record-keeping to ensure consistency. Employees are keenly aware of inequities – if promotions feel like a boys’ club or a reward for “gaming the presentation” rather than true results, morale and loyalty will plummet. Skip the structure, and you skip the perception of fairness.
Low Team Accountability: An absence of performance reviews can enable a culture of low accountability. Team members who are struggling or underperforming may continue on the same trajectory because no formal mechanism brings the issue to a head. Peers notice when someone isn’t pulling their weight, and if management seems oblivious or indifferent since there’s no review, resentment can build. Over time, this dynamic drains team morale and lowers its performance.
Missed Opportunities for Development: A good performance discussion surfaces an employee’s aspirations and lays out a development plan to get there. In companies with no reviews, these conversations happen rarely, if at all. Providing none at all is arguably even worse than a poorly executed one, because it sends the signal that leadership isn’t invested in employees’ futures. In an industry where specialized skills are in short supply, leaders can’t afford to send that message.
In sum, the absence of a structured performance review or feedback system tends to produce chaos, opacity, and frustration. Work becomes a black box with no clear link between effort and reward. By contrast, instituting even a basic review rhythm introduces clarity and fairness. It ensures problems are surfaced early, achievements are recognized beyond the loudest voice in the room, and everyone knows where they stand.
It Should Be Done on Results, Not Feelings
It’s not uncommon to encounter the charismatic person who always “talks a good game” – dazzling higher-ups in meetings, even if their actual deliverables are middling. Conversely, you might have a quiet, heads-down engineer who produces superb work but doesn’t self-promote. This is why performance evaluations must center on objective results and evidence, not subjective feelings or flashy showmanship. Basing reviews on data and measurable outcomes helps eliminate bias and ensures that substance wins over style. Leaders should be wary of being seduced by “halo effects,” where one positive trait colors all perceptions, or “recency effects,” overemphasizing the latest project while forgetting earlier performance. A data-driven approach is fairer and more effective in driving improvement.