How to Conduct an Effective Annual Review
Creating the Conditions for Success for Next Year
last update: December 2024
Why Conduct an Annual Review?
I’m a reflection evangelist.
We only grow to the extent we are self-aware. This makes our willingness to reflect the speed limit of our improvement.
Reflection determines the vision for our lives. Reflection identifies our highest priorities and puts us on the most direct path toward that vision. Reflection improves our systems and tightens our feedback loops. Reflection identifies the conditions that, allow our best selves to emerge.
Most importantly, life is better when we spend more time in the present. Small increases in the proportion of time that we spend in the present enhance our subjective experience of reality.
We direct so much energy toward the past—rehashing regrets and failures or reliving glory days—or toward the future, anxious about upcoming performances and deadlines. Both have poor returns on investment, if not given a clean container.
An Annual Review creates the time and dedicated space to examine the past and craft our future, enabling more presence in the rest of life.
If you’ve conducted an Annual Review, you understand just how powerful this process can be. An Annual Review allows you to examine the highs and lows of the last year, extract the lessons, and move forward into the new year, confident of where you’re heading and how to get there.
My Annual Review Worksheets are open-sourced and continually updated. So far, they have been downloaded 5,000+ times.
Why New Year’s Resolutions Don’t Work
Cultural milestones serve as valuable checkpoints. Nothing actually changes between the arbitrary dates of December 31st and January 1st, but a recurring “clean slate” to assess what's going on, what’s changed, and what's next is a can’t-miss opportunity.
It’s not the time of year that’s the issue; it’s the unrealistic expectations. New Year’s Resolutions don’t work because they don’t align with actual behavior patterns.
Two common mistakes to watch out for:
Don’t try to go from 0→60 too soon. New Year’s Resolutions take motivation and willpower for granted, expecting superhuman discipline in a previously dormant area. (Exhibit A: the gym during the first two weeks of January.) After an initial burst of momentum, most end up worse off than before—no new habits and disillusionment from the sting of failure.
Don’t commit the “same but more” fallacy. Start planning with a clean slate. Otherwise, your goals for the next year will look the same as this year, only more ambitious. Account for trade-offs. If you want to push yourself more, where is that additional time, attention, and energy coming from? A good rule of thumb: if you want to pick something up, something else must be put down.
Optimize for iterative upgrading over an entire year rather than making one massive change. Each new upgrade builds upon the foundation of the previous upgrade. If you want to get rich, set your sights on creating compound interest instead of trying to win the lottery.
Effective reviews are both pragmatic and pregnant with imaginative possibility: they take into account current constraints and previous history and are imaginative in that they push you beyond your current paradigm to entertain making radical changes.
Four Objectives of an Effective Annual Review:
Celebrate wins—Get a much-needed boost in momentum. Double down on what is already working.
Distill lessons—Avoid paying tuition for the same mistake multiple times. Reveal previously invalidated assumptions. Seal the container from the previous year to start fresh.
Integrate learnings—Surface shifting values and priorities. Identify the most direct path toward your goals. Illuminate actions to accelerate progress.
Generate creative tension—Build a complete picture of current reality and compare it to your future vision. The difference between those two images generates dissonance that demands resolution. That dissonance is your fuel.
My Annual Review Worksheets combine these four objectives in an easy-to-execute format.
Best Practices for an Effective Annual Review
I have personally guided hundreds of people through the Annual Review process. Here are eight best practices to make sure you get maximum benefit f:
1. Set aside the time necessary to go deep.
Set aside at least three hours across 2–4 days to do this right. Step away from devices between the four parts to give your subconscious time to work. You’ll come back with fresh insights.
2. Before you start, identify your Top Values.
Clarity causes conviction. Once you know what you are optimizing for, priorities become very clear. If you don’t know what is most important to you, it is very difficult to choose a path forward.
You can identify your Top Values using the Forcing Function Top Values Worksheet.
3. Create space for magic.
A clean context allows you to break away from your normal thought patterns. Retreat from your usual place of work to a quiet location without distractions. Find someplace inspiring that reflects the intentionality you are bringing to the process. Immerse in nature if possible.
4. Go analog.
Our tools shape us. Leave your devices at home. Print out the worksheets and write, don’t type, in the space provided. Give yourself permission to be messy.
5. Keep the pen moving.
Set a timer for each section and keep writing until the timer goes off. The biggest insight usually comes after we think we’ve thought of everything.
6. Treat reflection as a brainstorm, not a final answer.
Write down anything that comes up, whatever it is, without judging or editing it. Now is the time for generating ideas. For now, there are no good ideas or bad ideas, just ideas. You can select the best course of action later.
7. Return to your annual goals throughout the year.
Post your goals somewhere visible. Focus means keeping your object of focus at the forefront of your mind.
8. Share your lessons and goals with others.
Make performance a team sport. The higher the stakes, the greater the motivation for follow-through. Don’t hoard the gold.
Sharing my entire Annual Review in public for maximum accountability is quite powerful. If that feels like too much, share your review with a few close friends and loved ones.
It’s a two-for-one: maximize your odds of goal-achievement and deepen your relationships.