Getting Smart with Performance Appraisals
The process of performance appraisals appears to be one of the most hated (strong term I know) processes used in corporate cicles today. Executives and Managers do not like the results or the time taken to actually do a performance evaluation. Employees feel that most of the time the system used is short changing their value to the organization. In some cases employees feel that the appraisal is just plain wrong!
So what happened to this process that made it such a negative discussion point? I believe there are three points that have created this negative influence.
First, the performance evaluation process was linked to the pay system and has become a tool for managers to justify raises or no raises. This element combined with the infamous “bell curve” that forces a certain percentage of “poor” performers – even if a manager or department has learned the fine art of hiring high performers. This combination of factors alone create the most significant negative influence for the process.
Second, managers are poorly trained in the process of performance evaluation / appraisal. Due to a serious lack of training in most organizations this process is lacking in understanding and execution. Managers have a difficult time separating personal factors from actual job related factors. This lack of understanding drives a personality contest more than a performance improvement system. Politics and the good ole boy system gains a foothold in this critical long term improvement process and creates morale and performance issues. These factors combined with an annual event execution leaves the managers uncomfortable in how to do it and what is important – not to mention knowing exactly what the employee did during the first 8 to 9 months of the year!
Third, the matrix used by the organization can be misleading and not job related. We have seen many performance evaluation system set up as a “one size fits all” system. The terms used can be vague and unclear as to their application to a particular job. Jobs are different and require different skill sets, talent and performance standards. Speaking of performance standards, this another part of the puzzle that seems to be missing in most organizations and has a negative impact on performance appraisal systems. If no one knows the performance standards they are being judged and evaluated upon – how can an employee work on improving their performance?
Okay, enough of the bad stuff. What can an organization do to improve the performance appraisal system? There are three things that can be done to improve the levels of performance within the appraisal system.
First, detact the pay system from the appraisal process. When Peter Drucker first wrote about performance evaluation systems he referred to it as a method to improve performance and more specifically results. Some bean counter or efficiency expert (this term is used loosely since effectiveness seems to be missiing in most action steps) decided that if the appraisal process was combined with the annual review it would make it easier for the administrative part of the equation. The performance appraisal process is actually a performance improvement process and should be treated with respect and purpose. Improve the performance of the each person and watch the organization grow at a faster rate.
Second, have the managers trained in the performance review process. What factors are important to a job? Emphasis should be on the factors that will make the person excel in the job rather than match up to some “company standard list.” This training requires that the managers become involved in the job benchmarking of factors and traits for job success. They should also become involved in the development of performance standards for the job – measurable and meaning standards that allow an employee to know where they stand at any point in time regarding their personal performance. This is not a place for best guess or swag!
Third, to make this process truly work properly it can no longer be an annual event. It needs to become a living process that is used all year. Ideally, the performance improvement reviews should be held every three months. The reason for every three months is: becomes a regular process easier to do for managers and employees alike; managers can stay current with the process using monthly reviews and tracking systems regarding results achieved; and employees have a shorter time lag for improvement to be started. Making the process become part of the routine of the managers work process allows for the people to take a higher status within the organization.
If we beleive that people are our greatest asset, then it is important to systemize the improvement, nurture and grow of our greatest resource – people. Make this happen in your organization. Focus on your people and their growth and they will make you look good in turn.
If you need to learn more about the processes we offer for developng managers and providing benchmarking systems for jobs, contact us at 901-757-4434.
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