newsReuters reports that Germany's SAP, the maker of software used to grade the performance of millions of employees worldwide, is ditching its own annual performance reviews as too expensive, time-consuming and often demotivating.  

Once championed by business leaders as the key to better productivity, annual appraisals are falling out of fashion with companies including IBM, Gap and even General Electric, whose long-time Chief Executive Jack Welch is credited with popularising the system.  SAP is now one of the first major European companies to join the trend that began across the Atlantic.  SAP's human resources head Wolfgang Fassnacht commented:  “Grading workers did not work.  People are open to feedback, also to harsh criticism, until the moment you start giving scores.  Then the shutters go down.”  SAP is testing a new process, which includes more regular check-in talks.  Fassnacht added:  “The old system is too static.  It no longer reflects the dynamic circumstances we are operating in.”

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