It’s that time of year for annual performance reviews, a necessary evil to managers and employees alike. But, it’s not all that bad if done correctly and thoughtfully. The following are ways managers can optimize the performance review process:
Don’t postpone or reschedule a performance review
Perhaps the most important meeting a manager can schedule is the employee’s performance review. Whether the review is a quarterly or semiannual update, or the all-important annual review, set the date well in advance and keep it at all costs — save an emergency business or personal crisis. Delaying or postponing a performance review can be a sign of poor planning, misguided priorities and lack of preparedness. And while the manager is accountable for keeping the review date, employees can be equally guilty of avoiding a performance review. It reflects poorly on both parties.
Don’t shirk from the tough conversation
In a recent WorldatWork and Sibson Consulting survey, 63 percent of HR practitioners expressed frustration with managers who lack the courage to have difficult performance discussions. Some managers deliver performance reviews to their top performers first and save the dreaded ones for under-performers until the very end. Bad wine doesn’t improve with age and neither does a poor performers’ review discussion. Sub-par performers need to be assessed and given corrective feedback and coaching sooner rather than later.
Don’t combine performance reviews with salary discussions
Refrain from talking about compensation at the same time as performance. Here’s why: the employee will tend to focus more on the size of his/her pay raise, which detracts from the conversation about performance. Ideally, pay increase discussions are held a week or two after the performance review. That way, if the reviewer misses a major achievement and needs to add it to the appraisal document, there is ample time to correct it, as well as adjust the corresponding pay raise before it is communicated.
Do encourage employee self-appraisal
What an employee views as accomplishments is a very important piece of information for a manager to consider. A significant gap between a manager’s and employee’s appraisals is a signal that the manager has some work to do in providing the employee examples of performance that account for the difference in viewpoint. Don’t assume that this performance gap is due to employees inflating or “padding” their rating. On occasion, employees may even undervalue their performance and contribution. Granted, it is a more rare circumstance, but a gap is still a gap that needs to be reconciled with specific examples and feedback.
Do avoid rating biases such as the halo/horn effect
This occurs when an employee is rated (positively or negatively) on one trait or factor that can influence ratings for all the other traits. This problem often occurs with employees who are especially friendly (or unfriendly) toward the supervisor or especially strong (or weak) in one skill. To avoid the halo effect, evaluate all your people on one performance factor before going to another factor. This way the evaluation is based on the factors more than an overall impression of one individual.
Do include a success plan as part of the process
Too many managers use the performance appraisal as a way to provide negative feedback on employee performance instead of approaching it as a success plan for the coming year. A success plan outlines what success looks like, the skills needed to be successful, the organizational support they can expect (training, resources, budget, etc.), and what they’ll be receiving in return for their time, talent and effort.
Performance management is a powerful tool. The organizations that benefit from it the most are those that use it as a blueprint for success to drive business results forward, instead of a rear-view mirror look at what could have been.