Performance Appraisal … that time again?

Performance Management CourseThe formal performance appraisal process should take a minimum of time and effort. Typically they are completed annually and the same form or rating is used for multiple purposes; compensation, career planning, promotion, transfer, training and development, discipline, downsizing or termination.

We should recognize that some of these are incompatible purposes, and alternatives should be sought to resolve this issue. When you discuss an individual’s performance that is rated as “needs improvement” for compensation decisions, you should have a different format or Individual Development Plan (IDP) to get the associate interested in training and development opportunities.

The discussion of training and development needs to look forward and should be positive. When the same appraisal is used to discuss compensation, the associate’s mind set is on how they can convince their manager to provide a better rating so they will receive more compensation. The training discussion should wait for a more appropriate time.

Career discussions must deal with the evidence that the individual under consideration has demonstrated successful skills and abilities relevant to the new position. It is often necessary to explain that “outstanding” performance in the current position may be a result of skills and abilities not required in the new position. You must plan a conversation like this very well to avoid sending the wrong messages.

Informal Appraisals
Immediate feedback is the most effective method of managing performance, through coaching and counseling. Associate feedback should occur on a day to day basis and be integrated with coaching as part of the training and development program. The day to day feedback on how to improve performance is critical to obtain immediate behavior improvement. The formal appraisal process cannot stand alone. Evaluating and discussing performance at six months to yearly intervals fail to correct inadequate performance at the most effective time, which is when the inappropriate behavior occurs.

Audit and Review
Periodically the appraisal process should be audited. It is useful to develop a survey which states the objectives of the performance appraisal process and also asks all individuals appraised and those performing the appraisal to describe the success they have experienced.

The cost of designing, implementing, and performing the appraisal should be calculated. The payback in monetary terms should be calculated on the basis of: comparable data on turnover, promotion/transfer from within versus outside recruiting, number of grievances, absenteeism, discrimination complaints, etc. The human resources function typically tracks and calculates these costs.

Preparing for a Performance Management Session
Performance management is an ongoing process that involves regular goal setting, communication, evaluation and allocation of rewards or consequences. A good performance management program can help you get the best from your associates, because when associates know that attention is being paid to their performance, they are generally motivated to work better.

Performance management helps redirect associate efforts. An associate may be working hard, but working on the wrong things. Sessions throughout the year will enable a manager to focus on what associates are working on and direct efforts to better fulfill company goals. Periodic performance appraisal gives managers a measuring tool by tracking whether associates are achieving specific goals set for them and with them.

When it is time to award promotions and raises, performance appraisals can aid a manager by allowing a review of documentation that has been kept over the year on associates.

One approach to prepare for the session:

Preparation – Gather the needed information and ask the associate to provide any documentation that they would like to have considered in their appraisal. Set up a time and notify the associate. Finish preparing the associate’s evaluation and forward a copy to the associate for review ahead of time.

Conducting the Session – Start with light conversation. This sends the message that the meeting is not adversarial. Present the associate with a finished copy of the evaluation and allow time for them to read it. Review each section of the evaluation and discuss examples. Allow associates to ask questions or offer feedback. Together, set new goals and make plans for achieving those goals. Goals should be aggressive, yet attainable. And, document the new goals. Secure acknowledgement from the associate and the appraisal forms should have a space for associates to acknowledge that they reviewed the evaluation, even if the associate disagrees with certain aspects of it.

Bias-free Appraisals – The purpose of performance appraisals is to ensure that associates receive a fair and honest assessment of their performance over the past year, and to develop a plan to improve their effectiveness in the future. In a report by the Institute of Manpower and the Equal Opportunities Commission, appraisals were found to be riddled with personal bias. For example, assertiveness was valued more in men than in women.

Appraisals should not be about subjective viewpoints. Appraisers need to be aware of their own prejudices equating long hours with commitment, for example, or letting judgments about performance in one area color all the others (halo or horns effect). Supervisors should be trained in eliminating performance rating errors.

Make sure the performance standards are provided to all managers and associates and train supervisors to use the rating instrument properly. Allow appraisers substantial daily contact with the associate being evaluated and when possible, have more than one appraiser conduct the appraisals independently. Use a formal appeal mechanism and document evaluations and reasons for any disciplinary decisions.

Related Articles:   Performance Review Mistakes … 5 Big Ones!   and   Poorly Worded Performance Goals … No, No, No!

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James E. McClain is the author of Successful Career Development: A Game Plan, the book upon which some of our training programs are based. He has over 30 years' experience as a corporate HR executive, small business owner with ongoing experience in career development and as a college instructor. His educational background includes a B.S. and Masters degrees Education and Certification in Financial Planning. Our promise is that "you can pay more for training but you can not buy better training." The mission is to deliver the most effective and cost effective training and development programs.

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