Getting Value From Performance Reviews

The best performance reviews encourage managers and employees to communicate, share ideas, opinions, and information.

Unfortunately, most traditional reviews put managers into the position of uncomfortable judges, ostensibly telling employees how their work is, or is not, satisfactory.

Because of these problems, new types of reviews are coming into play. Most require that evaluations be done not for raises, promotions, or bonuses, but for growth, development, and communication.

Some people would say that performance reviews are the most dreaded of all management practices. Whenever the subject comes up, out come the groans. Sure, everyone wants the feedback, but the thought of filling out all those forms or enduring endless meetings is something no one relishes.

And to top it off, Human Resources departments seem to be continually tweaking the process, often trading in the old system for a new one at great cost in terms of time and money.

No one is ever sure as to what the benefits to the company are, but everyone sure takes these reviews seriously!

Many management consultants now say that traditional evaluation methods damage teamwork because of the focus on supervisors evaluating individuals.

A more desirable approach is where evaluations provide feedback to individuals so problems can be corrected and higher performance can be rewarded.

In the conventional annual performance appraisal or review process, the manager annually writes his or her opinions of the performance of a staff member. This exercise is completed on a document supplied by the HR department.

In some organisations, the staff member is asked to fill out a self-review to share with the supervisor.

Most of the time, the appraisal reflects what the manager can remember. Almost automatically there is an over emphasis on recent events and not an even coverage of the whole year.

Typically, the appraisal is based on opinions as real performance measurement takes time and follow-up to do well. The documents in use in many organisations also ask the supervisor to make judgments based on concepts and words such as excellent performance (what's that?), exhibits enthusiasm (hmmm, laughs a lot?) and achievement oriented (likes to keep score?).

Many managers are uncomfortable in the role of judge, so uncomfortable, in fact, that performance appraisals are often months overdue. The HR professional, who manages the appraisal system, finds his most important roles are to develop the form and maintain an employee official file, notify supervisors of due dates, and then nag, nag, nag when the review is long overdue.

Because performance reviews can be highly emotional, especially for the employee, it is best for managers to approach a review with a specific agenda in mind. They should plan in advance what they are going to say during each part of the review and make certain they deliver the message they want to get across.

Probably only the annual budgeting process comes even close to having the same effect on people as the performance appraisal.

If you visit a company that has set up all its annual reviews on the same date, you'll see lots of closed doors and frantic people.

A company-wide blood-pressure index would show a huge spike, as managers try to remember George's accomplishments, Debbie's need for improvement, Silvia's highest-impact deliverables, and what the heck Wayne has been doing all year, anyway.

Tips for effective performance reviews

Doing performance reviews professionally and effectively can have numerous benefits. There are communication benefits as well as benefits stemming from improvements in performance. But the reviews have to be done properly with plenty of preparation and care.

For many businesses a good review system can help to improve communications.

In fact, probably the best reason in most situations for conducting performance reviews is that they improve communication.

Performance reviews enable employees to receive feedback on how well they have been doing their jobs, and to set goals for the next year. At many companies, they also provide a way for employees to assess their managers.

But more than communication benefits, properly done appraisals can certainly aid employees to increase their effectiveness. They also help people clarify their responsibilities and what’s exactly required of them.

In the ideal world, a credible review system can not only increase the performance of the staff, but also help them to work together, with common goals and fewer obstacles.

360 degree feedback,
Upward appraisals, and
Peer appraisals.

Even in a micro business, these are all important management tools that can help people work together more smoothly and more efficiently.

If there is often tension in the workplace or if there are things that are never mentioned, appraisals, where they are carried out openly in an atmosphere of trust, can have a powerful effect. The performance of employees and managers alike can be enhanced significantly.

To make all this happen, it is important to involve employees in the process. If they have buy-in from the start, they are obviously more likely to support the system and embrace any results.

Retention is another related benefit of appraisals. Especially among younger people, one of the prime reasons employees walk out of organisations today is lack of communication, lack of direction and lack of feedback.

For putting a worthwhile review process in place, it is vital to customise the review for each department and job so employees are evaluated by factors that are most relevant to their positions. The more specific the criteria used to evaluate people in specific jobs, the more effective the review will be.

Some of the key competencies to focus on, include:

Job knowledge
Leadership
Management ability
Teamwork
Communication
Ethics
Judgment
Problem-solving ability

The ideal performance review should not simply look back at the past. It should preview the time ahead as well. It should have strong emphasis on planning – planning how to improve certain things, training plans and the role of the individual in the plans for the business.

As with any other important element of managing a business, preparation is vital. Both parties need to prepare ahead for the review meeting. The manager should review the staff member's goals and record significant points to be discussed. At the same time, it is important to ask the employee to come prepared to discuss his or her assessment of key accomplishments as well as areas in need of support or improvement.

For a performance review to be effective, even apparently small things should be attended to:

The venue – should be comfortable and easily accessible for both parties in a place that encourages open discussion (that means ‘the café’ is NOT appropriate);
The time of day – must be a time when the manager can focus 100% of his or her time on the review and allow enough scope for a full and unhurried discussion;
Scheduling – lock the meeting time into the diary well in advance so that both parties have plenty of time for thinking and preparing.

Before a manager launches into a performance review meeting, the objectives should be clear. Equally, the manager needs to focus on a small number of essential elements to ensure that the review covers everything and leaves both parties satisfied at the end:

Approach the review with an open mind, prepared to adjust or revise based on the conversation.
Concentrate on the big things first. Wherever possible, cite concrete examples and note specifics that demonstrate positive performance and areas in need of improvement.
Review each goal set for the performance period. To what degree were the expected results achieved? What steps can be taken to remove any barriers that interfered with success?
Keep feedback about developmental areas constructive. Be specific and objective. Use facts to support your feedback.
Focus on professional development. Performance reviews are an excellent time to discuss opportunities for your staff member's growth in his or her current position.

Kelly Services is a global recruitment company, operating in 37 countries delivering temporary and full-time recruitment and HR/Recruitment Outsourcing and consulting. To request staff, please contact Kerri Johnstone on 02 9246 6759 or visit www.kellyservices.com.au. All content in this article © 2008 Kelly Services (Australia) Ltd. Reprinted with permission from the original article at www.smartmanager.com.au

First published: 16 March 2006.
Last updated: 30 March 2006.