Regular reviews with staff will help maintain the engagement of staff with the business and hopefully highlight any issues early so they can be addressed before they become an issue.
This is particularly important for large organisations but just as important for smaller businesses. For smaller business, by showing employees that you are invested in their career and well being you are more likely to retain staff.
If however, you find that performance is an issue with a staff member, it is very important that you keep records of meetings to discuss their performance and be able to show that you have given the person every opportunity to improve their performance, stop the offending behavior or whatever the negative issue that is creating issues within the business.
Regular reviews and the recording of the discussions are a key component in managing staff in today's' employment environment.