Boost Performance with Effective Appraisals

05/04/11

Steel magnate Charles M. Schwab said years ago, “I have yet to find the man … who did not do better work and put forth greater effort under a spirit of approval than under a spirit of criticism.”

Few would dispute the truth of that statement. Yet performance appraisals, as many companies conduct them today, contribute to creating a company wide spirit of criticism that bars the way to organizational excellence.

This need not be the case. An employee performance evaluation that's conducted in an atmosphere of constructive dialogue can be non-threatening to managers and staff alike.

Even better, a solid employee appraisal system encourages both personal and organizational achievement, and it heads off performance problems before they get out of hand.

As employee performance appraisal expert Rebecca Saunders writes in The Agile Manager’s Guide to Effective Performance Appraisals, “When objectives are clear and set by managers and employees together, and when they jointly monitor progress toward them, fair and accurate appraisals are almost guaranteed. Good workers get the recognition they deserve, and poor performers learn about problems before they grow out of control.”

No matter what kind of appraisal system or method you use, understanding the pillars of effective appraisals will help you focus on the positive, boosting the performance of each employee and the organizational as a whole.

Here’s an overview of what you need to consider before you write even a single word on an annual review form:

1. Set Performance Objectives
Good appraisals begin with good job descriptions. That’s because the job description lists, or should list, the basic performance standards of the job. Make sure job descriptions are kept up to date – in today’s fast paced technical world, roles and expectations can change every few months.

Each objective should be as specific and measurable as possible. An objective for a
warehouse person might be, for example, “Pick and pack fifty orders a day.” Then, when you rate the employee on that objective, it will be clear whether performance fell short of, met, or exceeded standards.

Knowledge workers can also be held to concrete objectives. If developing marketing campaigns is part of a job, for example, you can easily create an objective like, “Develop an effective retail marketing campaign for the line of mops and brooms by February 15.” Just make sure you’ve defined “effective” in measurable terms, to avoid misunderstanding.

Include job growth and development goals
Part of boosting performance company-wide is encouraging employees to grow. When developing performance goals, include a few that go beyond the existing job description, but still relate to the job. For example, a graphic designer moving into web pages might be asked to “Learn Visio and start using it in wireframes by June 1.”

Make the goal setting a collaborative project
Work with the employee to establish goals. You want the employee to “buy in” to fulfilling them. Failing that, at least get the employee to agree that the objectives are achievable.

2. Monitor performance
Supervisors work hard at setting objectives. But many fail at two things that are at the heart of an appraisal-and-development program: keeping track of employee performance throughout the year, and documenting successes and problems. Skip either of these steps and your entire annual review process is meaningless.

“Monitoring” doesn’t mean hovering near employees all the time. It means:

Making sure the employee is meeting minimum standards.

Encouraging progress toward developmental goals.

Taking note when performance falls below standards, as well as when it exceeds standards.

Coaching employees when they need it.

Having serious discussions when performance sinks.

Waiting until the next appraisal to coach or discipline puts you on track to becoming a mediocre organization.

3. Document!
Many employment laws require that managers be able to justify “employment decisions,” which include decisions having to do with hiring, promoting, demoting, firing, disciplining, and so forth. But documenting performance throughout the year is important for other reasons, too. If you only hold appraisal meetings once or twice yearly, for instance, it’s almost impossible to remember what happened three, five or eleven months earlier without extensive written notes to help you.

Besides warnings and other disciplinary documents that may be discussed at an appraisal meeting, make sure to record facts about successes. Write occasional “performance memos,” for example, that outline the details of an employee’s outstanding performance. That way you'll have positive things to write on the annual review form, instead of just the complaints and criticisms that usually fill most of them.

Good documentation:

• Is based on facts only
  
• Discusses behavior only, never “attitude” or “personality”
  
• Notes good performance as well as poor performance
  
• Is clear about what improvements need to take place
  
• Is created the day an event occurs or soon after
  
• Never refers to physical or cultural characteristics
  
• Gets filed safely and securely.
  

“It’s hard to overemphasize the value of documentation that supports your personnel decisions,” says G. Neil corporate attorney Wendy Smith. “Having good documentation can scare off an employee—or former employee—who is contemplating legal action.”

4. Meet Frequently
Many companies hold formal appraisal meetings once a year. That might be acceptable if managers held informal meetings throughout the year, but few do.

Rebecca Saunders suggests four formal meetings a year. While the last meeting is still called the “year-end review,” the other meetings are equally important. “The purpose of interim interviews,” she says, “is to clarify any expectations that remain unclear, set plans for the next quarter to ensure continuation of current progress or to get the employee back on track.” Interim meetings are also useful in making sure the employee agrees with your assessment to that point in the year.

5. Meet Productively
“I like people to come back and tell me what I did wrong. That’s the kindest thing you can do,” said actress Lillian Gish.

If only all employees facing appraisals felt the same way! But they don’t, of course. It’s just as hard for them to receive honest feedback as it is for some managers to give it.

One way to blunt any pain—and make sure appraisals don’t create the “spirit of criticism”— is to focus on accomplishments and strengths. It’s not hard to find something kind to praise in just about any employee. Other meeting tips:

Put the employee at ease. Be cheerful, friendly, and start with a little small talk. Here’s where it helps to know your employees—their hobbies, names of children, and so forth.

Praise strengths.Tell what you like about the employee’s performance in the past few months. Just as important, say why you like it. It gives substance to the praise and ties good behavior to good results. Example: “Your efforts in getting the 2800-B off the ground were outstanding. If it weren’t for you, we would not have gotten the bid in on time. And then we wouldn’t have gotten the job. Thanks again for a wonderful effort!”

Point out where the employee isn’t meeting standards. If you’ve done your job, pointing out areas of weakness should come as no surprise to the employee. After all, you’ve been monitoring performance all along, and coaching as needed.

Rate performance accurately based on standards or agreed-upon objectives. If you worded objectives properly, a rating should be easy to come up with.

Do not give in to an urge to make light of a deficiency or upgrade it to “average” performance or better. That path leads to poor organizational performance. Instead, discuss the lack in terms of how you both can turn weakness into strength.

Let the employee speak. In fact, let the employee do most of the talking. For one thing, she may have relevant reasons for disputing a rating you give. For another, she may have insights into how to improve her own performance or that of the organization as a whole. Given the chance, employees will often create their own improvement or development plan.

Have the employee initial or sign the appraisal form. This can protect you legally, but it also sends a message: “This meeting has been a serious attempt to improve performance.”

6. Follow Up
Managing performance is a never-ending task. Once you’re done with a meeting, it’s up to you to ensure the employee exploits strengths or learns to meet basic standards. That only happens when you, the supervisor, manager, or HR person, take an active interest in that person’s performance.

As Rebecca Saunders says, “Doing a good appraisal demands thought, concentration, and many hours spent over the year. But it really pays off in improved performance and fewer management headaches.”