The annual review process is upon us. For the last several years, the traditional way of doing things - an employee filling out a self-evaluation form and sitting down for a half hour with his or her manager - is fast becoming obsolete. Some companies have started to throw out the annual review and instead, implement frequent feedback systems in an attempt to motivate and retain their workers.

Employees and managers alike are relieved that the feedback system is getting a makeover. But there's a big piece still missing: it's not just the frequency of employee feedback that needs to be changed, but also the substance of feedback.

From interviewing our Radiate Experts I discovered that critical feedback was a top-of-mind concern for leaders. This concern is no shock to anyone. The truth is most people hate giving criticism and even more people hate receiving it. This is something that Mitch Roschelle, Partner and Business Development Leader at PwC, recognizes: "I think we're all dying for feedback, and as managers we're all awful at giving it, and I don't know why there's this massive disconnect."

No one likes being criticized. We find it harder still when a critical lens is placed over the way we work. But Dan Gilbert, Founder and Chairman of Quicken Loans, sees immense value in receiving feedback. "Everybody should be open for feedback at all times from everybody, period. Now, it doesn't mean you have to agree with it all the time, but you should be open to it. It's like gold."

There is no cookie-cutter formula for giving feedback but UPS Chairman and CEO David Abney maintains that honesty is key when issuing feedback. "You are always looking for how you can be positive with people. Then, you have to be very honest. You have to tell them what you need to tell them, but you make it clear to them you are doing this because you want to see improvement, that you are trying to build them up, not trying to tear them down."

Conversely, the worst feedback happens when you're worried about being nice and empathetic. It's human nature to want to be liked so people--even bosses--tend to tell employees how great they are when they don't mean it. They bury the criticism in flowery, opaque language--or avoid it altogether.

Being nice might feel good, but it's counterproductive. Rather than helping your employee, you're actually doing something very cruel: You're keeping them in the dark about what they need to do to improve, just so you can feel better. Falling into the kindness trap doesn't help anyone.

Roschelle extols the value in giving honest feedback to employees. "Most people don't like it, but here's the little magic that I've learned about giving feedback: nine times out of 10, if not 99 times out of 100, when you give somebody that feedback, when you're done talking and it's their time to respond, the first words out of their mouth are 'thank you.'"

The takeaway? Honest critical feedback may be painful but in the long run, it will serve the needs of your organization (and your employees) much better than insincere politeness.