If there’s one thing that both the management and employees can agree upon, it’s that performance appraisals epitomize what’s wrong with the corporate world.
According to a report by WorkplaceTrends.com published in Forbes, only 55% of employees feel that their performance reviews are effective. Management research firm CEB found out that 95% of managers hate performance reviews. In the words of LinkedIn’s CEO of Human Workplace Liz Ryan, performance reviews are “just another stupid part of the bureaucratic Godzilla system.”
Companies around the world are spending billions of dollars every year to replace the industrial age era annual reviews. Some are switching to real-time feedback solutions, some are getting rid of them altogether.
However, the annual reviews aren’t going anywhere, at least for the time being. According to Ogletree Deakins, 91% of companies still have performance reviews.
So as a manager, it’s important to ensure that the appraisal of your team’s performance is fair, meaningful and doesn’t make them feel like…
Here are 6 signs that you have messed up your team’s performance appraisal:
1. You surprise people
“No surprises” is the golden rule of performance appraisals. If you give feedback to your team members during their annual appraisal, and it surprises them, that’s a big red flag. Not as much for them, but for you. There can be many reasons behind it:
- You hadn’t provided continuous feedback/coaching during the year. That’s why the employee was caught off guard by the appraisal.
- The appraisal is inconsistent with the feedback given during the year.
- The appraisal missed some factors that the employee has in their mind.
It can also be because the employee wasn’t self-aware about their performance despite frequent feedback.
2. You pass the baton to top management or HR
No one likes to deliver bad news. Often managers stress out when they wish to deliver negative feedback or discuss raise and resort to a Pilateish approach. “I’d love to offer you a higher raise but unfortunately the HR policies prevent me from doing so.”
Not only can most employees see through this, but they’ll lose some respect for you. Employees need to view their manager as the one person who they can rely on for everything related to work. During appraisals, a manager needs to own their decisions 100%. The aim is not to make people like you but do what’s right for them and the company.
3. Your rewards are inconsistent with feedback
In many organizations, the rewards are not consistent with performance appraisals. Or they might not be linked closely enough. For example, if a top performer gets a 5% raise and a weak performer 4%, performance appraisals would lose their importance and people would stop taking them seriously. Without tangible rewards, words don’t mean much.
If you have a tiered ranking system, ensure that there are enough incentives for employees to aim for higher ranks.
4. You don’t have an action plan
Once the appraisal is done and discussed with the employee unless it’s followed by an action plan, the whole exercise will fall apart. When an employee walks out of the meeting room, they should have a list of concrete steps that they can take to improve. Too often feedback is vague and ends up confusing or offending people.
To make feedback action-oriented, it’s important to make it impersonal and focus on specific issues. Behavior and not the person should be the subject. For example, rather than saying “You need to have a more positive attitude.” (which can be interpreted in a 100 different ways), quote specific examples and give clear direction on what that means – “ I’d like you to be more receptive to ad-hoc requirements from your teammates.”
5. You’re asking other managers for advice
It’s not a good sign when you start asking fellow managers for advice on doing appraisals for your team. This doesn’t mean you shouldn’t ask them for feedback on the performance of specific teammates. However, no one understands your team better than you do. Even your own manager.
In the end, you’ll study different data points, but you should always take the final call on your team’s performance appraisal.
6. You’re not aware of your biases
All performance appraisals are biased. We are all humans and it’s impossible for us to be 100% objective. So what can we do?
First of all, you need to acknowledge that whatever appraisal you’ve done, it’s biased in some way. Only when you acknowledge it, you can take steps to minimize the bias.
Be aware of the following 5 types of performance biases that often creep up during appraisals and see how much you’ve been affected by each of them:
- Recency – You give more weight to the performance in recent weeks than the earlier months. For example, even though someone performed well most of the year but made a huge mistake a week before performance review, their entire appraisal is centered on that one mistake.
- Halo/Horn – One good trait (Halo) or a bad trait (Horn) can overshadow the rest of an employee’s traits. For example, just because someone lacks communication skills, you rate their entire performance poorly.
- Centrality – Your tendency to play safe and maintain harmony leads you to give average ratings to most of your team.
- Primacy – Your appraisal is deeply affected by an employee’s first impression.
- Leniency – Your tendency to not offend others makes you rate them higher than their actual performance.
The road ahead
In an ideal world, organizations won’t need formal annual appraisals. For that to happen, real-time feedback that’s evidence-based becomes key. As more and more companies move towards adopting online collaboration tools, it will become natural for them to manage feedback in the same place they manage work. That’s what 4000+ companies are already doing with Taskworld.