The Performance Appraisal Solution

by Sharlyn Lauby on January 19, 2011

I’ve seen more articles lately about the failures of performance appraisals than just about anything else.  And, it seems that the only logical answer is to abolish them.  You can read some of these viewpoints here, here, here, here, and here.  And, my apologies to writers I may have missed.

While I admit I haven’t spent any time researching the history of the performance appraisal, it only seems reasonable that performance appraisals were created to fulfill some kind of organizational need.  My guess is some company had a bunch of employees complaining they never knew how they were doing.  Managers were busy running the operation and hated giving feedback so it just didn’t get done.  “No news is good news” was the performance management philosophy.

So some human resources pro suggested creating an annual process called the performance appraisal.  Managers would be mandated to give employees performance feedback on a regular schedule (whether they liked it or not).  Once a year, employees will get feedback about their performance.

(Insert sarcasm here)  The HR pro was instantly heralded as a genius and a statue in their honor was erected in the parking lot.  The managers hated it.  But who cares?  Life was good for both employees and the HR Pro company.  Of course, this performance appraisal utopia was destined to only last for so long (for the reasons my colleagues explained in their articles.)

Which brings us to today.  Don’t get me wrong…I agree with many (if not all) of the observations my fellow bloggers have about performance appraisals.  But I’m not convinced the answer is to abolish the performance appraisal.

Because it doesn’t resolve the employee’s need for feedback.

IMHO, the way to fix performance appraisals is to make them obsolete.  If managers were trained in the proper way to give performance feedback and then talked with employees on a regular basis about their performance…there would be no need for a performance appraisal.

Now it might not eliminate a formal documented conversation.  But the formal conversation wouldn’t be focused on past performance.  It would be about goals and the future.  Let’s call it an annual development discussion.  Totally different conversation.

Do your managers hate performance appraisals?  Tell them they have the power to make the process obsolete.

Image courtesy of Wikipedia

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John Jorgensen January 19, 2011 at 9:39 am

From your mouth to line managers ears……

Ann Bares January 19, 2011 at 1:02 pm

Great post. Agree that regular communication would be better (although documentation is still, unfortunately and in many situations, necessary). But it seems to take an exceptional organization to follow through on this. I have a few clients who’ve tried this – abolishing performance appraisals, and replacing them with regular coaching and feedback … but they don’t seem to have the discipline and focus to really deliver on the concept over the longer term. I think it takes an extraordinary amount of commitment. How do we get there?

Scott Brown January 19, 2011 at 5:19 pm

You still need a system to enable and track that communication. One inventive approach is to house it within a social media-like framework. Companies such as Rypple are addressing this issue in a very compelling, creative way.

Sarah Nguyen January 20, 2011 at 1:57 am

This is something the company I work at (Atlassian, a software development company) struggled with for years. Everyone hated performance reviews (would it be wrong to say ‘me too!’?), but we didn’t know how to ‘fix’ the problem, so we kept trying to change our review process. Nothing we tried work. Frustrated, we started researching it and surprise, surprise realised we weren’t the only company struggling with this. We spent a lot of time speaking with staff and managers and decided to introduce a coaching model. The concept, simply put, is to help managers and staff have regular dialogue about topics related to their development, thereby spending more time on helping staff grow and focus on what they’re good at. We’ll also discuss performance every 6 months, but we’ve ditched the dreaded performance rating.

We’ve introduced monthly coaching topics to help structure the conversations (we’re up to month 4 at the moment). It’s still early, so we don’t have any results to share yet, but we’ll continue to blog about our experiences. If you’re interested, you can read more about it here:

http://blogs.atlassian.com/news/2010/08/atlassians_big_experiment_with_performance_reviews.html

http://blogs.atlassian.com/news/2010/11/atlassians_big_performance_review_experiment_-_part_ii.html

Sharlyn Lauby January 20, 2011 at 11:31 am

Thank you everyone for the great comments. I don’t know that this is an easy problem to solve. It’s good to hear companies are having the conversation about ways to deliver meaningful feedback. Even if you keep the forms, anything we can do to streamline the process and make it more about the conversation (and less about the paperwork), would be valuable.

Luke January 22, 2011 at 4:51 am

This is always the same story. No one like the performance appraisal, but everyone does it. It is important to make managers to give the regular and formalized feedback (at least the procedure should be the same for all employees), but is should be positive and it should have the real outcomes. As the goal settting process should be SMART, the performance appraisal procedure should be SMART as well.

Sharlyn Lauby January 24, 2011 at 8:20 am

Thanks for the comment Luke. I’m a huge fan of SMART.

Roger Plachy January 31, 2011 at 4:02 pm

We should not miss the point that the manager must set and enforce organization standards, which means telling employees when they are not meeting the standard. However, up to that point, managers are better served by focusing on the work and not on the employee performing the work. What work needs to be accomplished? How well is work being accomplished? What can be done to improve work outcomes? I believe in job descriptions (I hear the boos already) but they establish the work relationship between the organization and employees, and from this basic contract, objectives should be established for the next work period. Track and manage work! Doesn’t every organization need to do this? Conversations with employees will flow naturally.

Ben Moore February 1, 2011 at 11:14 am

“But the formal conversation wouldn’t be focused on past performance. It would be about goals and the future.”

Sharlyn, I agree completely. Perhaps, it is difficult to solve this problem *culturally* but WorkSimple’s product does enable and automate much of everything you describe above.

Sharlyn Lauby February 1, 2011 at 11:29 am

@Roger – Thanks for the comment. I agree that managers need to explain the company standard and hold employees accountable. In my experience, I haven’t seen where this naturally leads to employee conversations. Unfortunately, many employees don’t have direct access to the information that shows them outcomes are being achieved. Which is why managers need to close the loop and share those results with employees.

@Ben – Thanks for sharing a new resource!

Performance Appraisal February 15, 2011 at 2:17 pm

I totally agree with you. Performance appraisals need to be transformed into a useful, constructive evaluation instead of the current system.

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