Performance appraisals need an overhaul

Dreading another year of haphazard and poorly executed performance appraisals? Karen Barker provides her tips for revamping the process.

Performance appraisals can increase team morale, staff performance and commitment. However, if done poorly they can do more harm than good. According to estimates, only 35-40% of companies manage performance reviews well. For the remaining 60-65% they are a stressful and negative annual experience that adds very little value to the employee’s growth, while at other times in the year their true needs and challenges remain ignored.

Many organisations treat performance appraisals as just another annual task in a time-poor business environment. Instead, the process should be one in which hard-working employees receive appropriate recognition and gratitude, and managers have the opportunity to acknowledge the outstanding contributions of members of their team.

 What can HR professionals do to change the way that managers view performance appraisals?

In order to make sure that the whole process is positive and effective, HR professionals need to encourage managers to turn appraisals into a regular business activity, rather than simply having one per year. The reason for this is that when performance is not monitored on an ongoing basis, employees and managers might not feel as though they are able to voice any concerns that they may have. Consequently, employees are often unprepared for constructive feedback during appraisals.

HR professionals should suggest that ‘performance plans’ and appraisals be kept separate and that space is made for the former if circumstances warrant it during the course of the year.

What makes a good performance appraisal?

Performance appraisals do not have to spell angst for those involved. HR professionals can work with managers to help them improve the effectiveness of the process. Some simple strategies that you can suggest include:

1. Collecting feedback. Managers should collect positive data on their employees’ strengths throughout each year and not just on the period leading up to the appraisal. Positive news is easy for the manager to deliver and for the employee to hear! Treat constructive feedback as areas of opportunity for growth and continued self-development and always start the appraisal with positive feedback. Managers should also include feedback from colleagues and peers in the review – to ensure the appraisal is well rounded and includes different perspectives on behaviour and approach. This additional feedback should be collected anonymously and via a formalised and consistent process, for example, 360 Degree Feedback, which can be provided by an ICF (International Coach Federation) credentialed coach.
2. Keeping it informal. Reviews should be conducted in an informal setting, such as a quiet café or nearby grounds that offer the opportunity to pleasantly sit, where both parties can relax and have a comfortable discussion without the pressure of more formal surrounds.
3. Focusing on the future. Dialogue should focus on future plans and objectives, and how both parties can work together to achieve results. Managers should ask employees what they need from them, or how they could be of more assistance. Then objectives and support plans should be agreed upon.
4. Continuing to collaborate. Both parties should agree to maintain an honest and transparent dialogue and plan to regroup quarterly to discuss progress and provide opportunities to reset objectives. During these quarterly meetings, employees should present a list of achievements for discussion in addition to being honest about any areas in which they could have performed better whilst acknowledging how a better outcome could have been achieved.
5. Redesigning the appraisal document. Appraisal documents should not represent employees as numbers. Allow the form to speak about the person’s strengths, achievements, goals, results and aspirations. This will turn the dread that usually comes with a performance review into a welcomed and emotionally uplifting experience for all parties.

If HR professionals can encourage companies to change the way they think about performance appraisals and transform them from a once-a-year chore into quarterly reviews that facilitate an ongoing and open dialogue that allows room for employees to flourish, they will effectively be helping to create an engaged and vibrant workforce that is committed to the continued success of the organisation.

About the author

Karen Barker is Director and Principal Consultant at Transitional Executive (http://transitionalexecutive.com.au/), and is an International Coach Federation credentialed coach.