I recently wrote a post about one aspect of the performance review process that employees like – getting merit increases. Many organizations link performance reviews with pay increases so even if the performance review is boring, at the end, there’s a conversation about compensation. This certainly isn’t ideal but in some organizations, it’s reality.
In the comments for that post, one reader felt that eliminating the annual employee performance review would actually create more opportunities to discuss pay and potentially increase the number of pay increases employees could receive. So employees would not feel limited to one pay conversation each year held in conjunction with the employee’s annual review. I totally get it, but the cynical side of me isn’t quite sure that’s how it would really play out.
But the reader also made one other observation worth noting. They said “…more frequent pay raises when they are deserved for great work!” That means managers must know what great work looks like. I couldn’t help but smile when I later saw this Time Well Spent cartoon from our friends at Kronos.
The performance appraisal process is considered broken by many. Several organizations claim to have eliminated it completely. I can’t help but wonder, if managers had good visibility into the performance of their employees, would the performance review conversation look different? Is it possible that part of the challenges with the performance review process has nothing to do with the process at all?
Managers must be knowledgeable about employee performance. It’s key to delivering effective performance feedback. Whether that’s in a weekly one-on-one session or an annual performance review. Managers should be able to communicate the company’s performance standard, identify when an employee meets the standard, and coach when they do not.1