Evolving performance management in professional services - highlights from our survey

This article provides preliminary highlights from our recent survey on evolving performance management in professional services firms. Over 170 firms participated in the survey. The article is based on presentations recently delivered to People in Law and Managing Partners Forum in London in December 2024.

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Performance management is evolving rapidly in professional services, driven by hybrid work models, technology, and shifting employee expectations. Here are five key highlights from our recent survey:

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1. Increased feedback frequency is the form

While 80% of firms still rely on annual or biannual reviews, informal feedback is on the rise. Over 60% of employees now have at least quarterly check-ins. These informal sessions, often coaching-style conversations, have gained traction due to their simplicity and ability to foster real-time development. Leaders should consider combining formal reviews with frequent informal touchpoints to create a robust and holistic feedback approach.

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2. Project-based feedback is underutilised

Despite its potential, project-specific feedback remains inconsistent. Only 40% of employees receive routine feedback after significant projects. Accountants lead the way in leveraging project feedback, partly driven by audit teams’ job feedback processes, while law firms lag behind. Firms should prioritise post-project reviews to ensure on the job learning is captured and applied.

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3. Hybrid work challenges feedback culture

Hybrid work has transformed the feedback landscape. Although 57% of firms report no significant impact, one—third of firms say that their feedback culture has suffered from hybrid working and note the loss of spontaneous, informal interactions. Some firms address this gap by scheduling structured feedback sessions, being more intentional about feedback and using technology to facilitate remote interactions.

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4. Technology and AI are changing performance management

Technology adoption in performance management has soared, with 72% of firms using dedicated tools, up from 40% in 2015. 92% of firms are deploying AI or planning to deploy AI to support their performance and feedback practices. However, many firms could go further and underutilise their existing tools to extract insights from the data already generated. This is a chance to tell the performance story of the firm, obtain actionable insights for firms and groups, and close a vital learning
loop.

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5. A feedback culture requires leadership and management training

Creating a feedback-rich culture means equipping leaders and managers with the skills to provide meaningful, consistent feedback. Training emerged from the research as a key priority, with the need for coaching skills and psychological safety seen as particularly important. By embracing frequent feedback, leveraging technology, and building capacity, firms can drive performance and engagement in the evolving workplace.

In January we’ll release the full report with all our findings. There’ll be some great insights relating to the use of ratings and metrics, the links between performance management and HR decision making in relation to compensation, bonuses and promotion, and much more. If you’d like to receive a copy of this report, please contact Paul Lemon (paul.lemon@performanceleader.com). Our thanks to our respondents, as well as our research partners, People in Law, Managing Partners Forum UK and Chilli IQ.