PwC’s Evidence-based Innovations in Performance Management

PwC recognized that its performance management (PM) system needed a transformation to better support employee development and drive company growth. As Kimberly Jones, Managing Director of Talent Strategy and People Experience at PwC, shared in a recent webinar, the firm is moving away from a traditional, ratings-driven approach. “We needed to create a performance culture that was continuous, transparent, and development-focused,” she explained. PwC has been piloting a new approach that aligns with day-to-day work and encourages real-time feedback.

How does the new system work?

Instead of annual evaluations, PwC has implemented

• Real-time feedback
  • Informal feedback in the moment is continually encouraged in 360 degree fashion (downward, peer, upward). These conversations typically cover both positive and constructive feedback related to work that has just occurred.
• Feedback during and upon completion projects
  • Managers document “snapshots” of performance, centered around 2+2 conversations, where two strengths and two areas for development are discussed.
• Quarterly and mid-year feedback
  • Periodic coaching cycles in which managers and employees review overall progress for the quarter and at mid year, adjust goals, and address strengths and development needs, aligning feedback with future plans.

As a capstone to the feedback given and received during the year, PwC has an annual moderation process at the performance year end to make decisions for compensation increases and bonuses within peer groups. Interestingly, PwC’s process mirrors the key  practices that drive performance management success as identified by i4cp’s research and described in this executive brief. PwC’s story is a real-life example of these evidence- based practices in action.

1. Look beyond performance ratings

When discussing the debate around traditional rating systems, Kimberly offers a clear perspective: “The rating debate–whether to keep them, remove them, or alter them–is a distraction. It’s not about the ratings; it’s about the quality of conversations and feedback.” Instead of concentrating on rating scales, PwC emphasizes development and coaching. By moving away from an overemphasis on ratings, leaders can shift toward a deeper focus on growth and improvement.

PwC’s People Strategy, “My+” highlights this approach. It outlines a system centered on cultivating desired behaviors and providing transparent, real- time feedback, helping employees understand their performance and areas for growth. Its four components are

• Well-being, including support for physical and mental health, financial, social, spiritual, and emotional well-being.
• Total Rewards, including a menu of benefits and perks, with options for every stage of life and career.
• Development, including elevated leadership, coaching, and technical skills; and personalized opportunites to grow through experience with a variety of different teams and assignments.
• Always a PwCer, including exciting and motivating professional paths – whether inside or ultimately outside PwC

PwC’s data-driven approach to career development delivers a more transparent, actionable, and efficient experience. Its components include a PwC Professional behavioral framework, new performance measures that assess employees on these behaviors as well as their technical skill and adoption of firm strategy, a new snapshot and performance dashboard (shown during the webinar), and an evolved Development Leader role.

2. Foster a culture of continuous performance feedback

Traditionally, PM systems have focused on evaluating what an employee achieved in the past year. Kimberly, however, shared that PwC recognized the need to focus on how leaders engage with their teams and the environments they create. “It’s not just about hitting targets—it’s about fostering a culture of support and growth,” Kimberly explained. This shift holds leaders accountable not only for business results but also for their role in shaping the employee experience.

By holding leaders responsible for employee development, PwC ensures that its PM system contributes positively to both individual and organizational growth. This reflects research from i4cp, which shows that high-performance organizations prioritize the employee experience to drive better outcomes.

Creating a culture of continuous feedback is key to building trust and promoting development. Kimberly emphasizes, “A culture where feedback is continuous builds trust and allows teams to grow organically.” By embedding feedback into daily interactions, PwC fosters a culture where employees feel supported, not just evaluated—an excellent way to build trust.

The snapshots of performance and progression shown during the webinar give both employees and managers a transparent view of performance and progress, fostering a shared understanding of strengths and development needs. Kimberly points out, “When feedback is thoughtful, balanced, and ongoing, it feels more like a focus on growth and less like a focus on shortcomings.” This approach supports a culture that encourages employees to engage actively with feedback, focusing on their growth.

3. Equip and incentivize managers for better feedback and goal setting

Managers are crucial to the PM process, and Kimberly stresses the importance of equipping them with the right tools. “Training alone isn’t enough. Managers need simple tools that make it easy for them to set clear goals, manage outcomes, and deliver feedback effectively,” she explains

PwC's Performance Dashboard, illustrated below, provides real-time feedback and performance data. This enables managers to have informed coaching conversations and helps ensure their teams stay on track. Kimberly elaborates, “When you give managers the right tools and data, you help them move from only managing tasks to truly coaching their teams.” Such tools support a shift in focus from managing activities to managing outcomes and development, enabling clear and actionable feedback.

4. Build trust in the PM process and hold leaders accountable for the employee experience

Trust is foundational to an effective PM process, and it’s cultivated through transparency, objective development discussions, and leadership accountability. Kimberly highlights, “When discussions center on an employee’s development and well-being rather than pay, it creates a more open and meaningful dialogue.” At PwC, leaders are encouraged to build trust through regular check-ins, ensuring feedback is ongoing and outcome-focused.

PwC’s approach to PM emphasizes leader accountability for the experience of their employees—a focus that Kimberly highlights as crucial to building trust and engagement. She noted that the role of a leader isn’t just to assess performance but to cultivate a work culture where employees feel supported and empowered. “When leaders are recognized for the way that they create a developmental and positive environment for their people, they naturally find it easier to prioritize team well-being and growth. They are able to see how important behaviors are to the organization, when the desired behaviors are included in performance assessment metrics,” she shared. PwCers are expected to “give back” by contributing to the development of others.

This transparent approach to PM helps managers and employees have honest conversations about growth, aligning with i4cp’s research that highlights the importance of leadership accountability for employee outcomes. PwC's approach, which fosters both performance and well-being, serves as a model for building a trustworthy culture.

For additional strategies on building trust and holding leaders accountable for employee experience, i4cp’s toolkit is a valuable resource: i4cp Toolkit: How to Hold Leaders Accountable for Employee Experience.

Conclusion: Build a culture of feedback, trust and accountability

Kimberly’s overarching message to leaders is to focus on culture rather than performance rating systems. “Performance management is more than a process—it’s a key ingredient to culture,” she explains. By emphasizing continuous feedback, properly equipping managers, and fostering trust, organizations can create an environment of growth and engagement.

PwC’s approach to PM offers a roadmap for organizations seeking to shift from rigid process-driven systems to a feedback-driven culture. By focusing on continuous development and building trust, leaders can cultivate a culture that supports employee growth and overall business success.

For more insights from Kimberly, the full webinar recording can be accessed here: Innovating Performance Management: PwC’s Unique Approach to Employee Success