The announcement of an upcoming annual performance review is usually accompanied by a pervasive sense of dread that permeates the workplace. Performance reviews can be stressful for all members of an organization, from the managers who are tasked to giving reviews that are constructive without being overly critical, to employees who face being subject to potential criticism and biased reviews, to HR personnel who are responsible for overseeing the entire process and ensuring that it is actually beneficial. More and more individuals and organizations have begun to decry annual performance reviews and have moved towards different methods of performance evaluation. In managing employee performance, it is important to recognize the shortcomings of the current system of performance review and to develop a unique framework that meets the needs and goals of your organization.
First, it is important to consider where typical performance reviews fall short. In most workplaces, there is a quick turnaround time on projects, but performance reviews often happen only at the end of the year. This is problematic because it causes managers to struggle to get a full picture of employee performance throughout the year. It makes the review process feel outdated, and the push to cover an entire year often forces performance reviews to be backwards-looking, as opposed to forward-moving. Because of this, many organizations have begun to shift to more continuous feedback throughout the year to take the pressure off of an end-of-year review.
Another major problem that arises during typical performance reviews is reviewer bias. Studies have shown that reviewers tend to view employees with similar personalities as themselves more favorably. One way to minimize the effects of individual bias is to involve more people in the evaluation process. There are several layers in which employees can be evaluated- by themselves( with self-assessment), by their managers, peers, subordinates, project leaders, and sometimes even external partners or clients.
In order to remove some of the angst surrounding performance reviews, organizations need to rethink the role and effectiveness that these reviews are playing. It may prove beneficial for organizations to shift from viewing performance reviews as an annual compliance event to viewing it as a set of practices that are occurring continuously and creating lasting value for the organization and the people within it. These practices include goal setting, planning, coaching, development, and rewarding achievements. That being said, there is still benefit to formalized reviews — provided they are performed more than just annually.
These reviews can be more effective by focusing on the following:
- Establishing SMART goals for employees
- Specific, Measurable, Actionable, Realistic, Time-bound
- Assessing the achievement and attainment of past objectives
- Applying this information to encourage increased future performance through coaching, development, and other means
Often times, it can be hard to pinpoint issues that are holding back an organization, and many go overlooked, even in performance reviews. Here are some ways to rethink and/or shift your performance management strategy:
IF individuals seem to be establishing goals without regard for overarching business objectives,
- Be sure to clarify how roles support business drivers and ensure that managers are helping employees develop goals that fit into the overall business strategy.
IF managers appear to be uncomfortable with having difficult decisions and instead are “managing to the middle”,
- Emphasize the importance of managers being responsible for supporting the maximum potential and benefits of each performance review, even when it requires difficult conversation
IF performance evaluation is limited to qualitative evaluation,
- Ensure that there are fair and systematic processes for performance evaluation in place that include both qualitative and quantitative measurements
Ultimately, you want to reach a point where the appraisal process of your organization is well-positioned and respected within the organization. Hence, the appraisal process itself should also be under review. The manager and the employee should both be active participants in preparing for and contributing to the review process.
When formal reviews are performed with more frequency, and results are measured against stated and agreed upon goals, anxiety and surprises are eliminated. There still may need to be some “difficult conversations”, but by following these tips, they will hopefully become a rarity in your organization.
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