I believe most of the problem stems from the fact that performance reviews are regarded as an “annual project.” If employees and managers regard performance reviews as an everyday thing, the dread factor is reduced to zero. But, who has time to do reviews every day?
Suppose for a minute that you could wave a magic wand over your operation and have every employee know exactly what is expected of them all day, every day. Now, consider the possibility of your management team monitoring the performance of your business by managing the employees' expected work outputs. You would be providing specific objectives and managing based on accomplishment. Would there be any doubt in either the employee's or manager's mind about how he/she was performing?