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Carrying out appraisals in a fruitful way

posted by – May 21st, 2013


One important HR function is the completion of Performance Appraisals (PA) which quite often represents a major challenge, said 10Eighty founder and chief executive Michael Moran. Their aim is to provide valuable information to both the organisation and the employee about current performance, results and progress. However, very often this process encounters substantial resistance from both managers and employees alike.

A survey conducted by the Society for Human Resources Management concluded that more than 90 per cent of performance appraisal systems fail, with both managers and employees saying that they dread the execution of this process. As a matter of fact, it is common practice for HR departments to routinely report that they have a desperately hard time getting managers to deal with the personal appraisals of their subordinates.

Traditional appraisal systems were designed for a work environment where control of an individual employee’s performance was a key function. Such an approach does not properly fit in a modern, values-based participative working model, because it is viewed as a paternalistic, top down and autocratic way of managing.

The use of standardised models for the annual evaluation leads the company’s managers and employees to dread, dodge or bypass this task until finally they grudgingly decide to comply with the system. The users of this type of evaluation model dislike the forced comparison, box-ticking exercise, which is monotonous and lacks the creative element that challenges and motivates employees.

More often than not, managers do not receive the training necessary to carry out appraisals properly, which is why employees do not feel that they will be getting any benefit from the process. Moran emphasises that this could be one of the main reasons why it is such a nightmare for HR departments to get all the data gathered in time for the salary evaluation exercise.

Moran outlines below what a personal appraisal system is supposed to address. In fact, he specifies the significant areas of concern to both management and HR as being:

·        Performance management

·        The alignment of individual performance with organisational objectives

·        Aiding the employee’s development and growth

·        Improving the communication system


These points are aimed at improving the performance of the individuals and the organisation as a whole. Regrettably, it would seem that for most it does not seem to work this way. A study carried out by Development Dimensions Incorporated in 1998 found that, in fact, employers express overwhelming dissatisfaction with performance reviews.

Moran asks what HR professionals can do in order to have a Personal Appraisal system that is more productive and less painful.

He starts by saying that HR needs to sell the appraisal system as a development tool and persuade management of the benefits that will accrue with its use. The review ought to be an opportunity for a dialogue between the manager and the subordinate, a chance for the employee to express his or her perspective on the job, the organisation, the manager/supervisor, his or her views of the performance, any ideas for improving operations and processes and any aspirations to grow in the job. Appraisals should offer the chance to review what works, what does not and what is required to do better in the future.

In order to be successful, an appraisal needs commitment from both parties, and it is essential that it is conducted in an environment where ideas and views can be expressed openly. Psychologist and management consultant Peter Honey says that while formal appraisal systems usually put the burden on the appraiser, “they work far better when the individual being appraised takes the initiative and is determined to use the occasion as an opportunity to solicit feedback”.

Managers need to work with an agenda set by the person being appraised to discuss short and long-term career goals, skills to be acquired, opportunities of interest, mentoring possibilities and so on. The manager may add to the agenda but in the first instance the employee “self-assesses”, while the manager gives feedback and, in turn, sets the goals that need to be aligned with the organisation’s objectives. The appraisal should be a time for negotiation, with the manager’s main concern being the support and resources needed by the employee being appraised in order to achieve the established goals.

If we accept that a manager’s prime responsibility is to manage the performance of people, which is best done proactively and with joint ownership, then we have to acknowledge that for the appraisal to be a positive experience it has to be a two-way conversation, an exchange of ideas and information. There is no “one size fits all” option. In order to have a personal appraisal system that works, there has to be a climate of trust and respect and managers need to understand what motivates their employees, as different workers have different priorities.

A good appraisal system has to take into account how employees rank their own performance and ultimately an agreed rating is established that satisfies all parties involved. This means that individuals need to have clear targets and standards against which they can assess themselves. Unfortunately, all too often managers have no idea as to how to effectively carry out an appraisal or they lack the required interpersonal skills to do so. If HR professionals improve management’s skills in dealing with interpersonal relations, they can provide an environment that facilitates a more trusting relationship between managers and staff that will lead to much more productive appraisal sessions.


There is more to performance appraisals

As managers, we surely know that employees who have access to training, resources and development opportunities that improve their performance and help them reach their career goals are happier, more engaged and empowered in becoming champions of their company. But employee engagement is not the only goal that HR should have in mind when they are selling the benefits of an appraisal system: there could be more to it.

Morgan cites research carried out by Professor Michael West and Dr Susan Michie, who concluded that “people management, the well-being of staff and staff experience have a high effect on individual, group and organisational performance, as well as on the outcomes of that performance”. West said: “If you have in place HR practices that focus on effort and skill; if you develop people’s abilities and talents; and if you encourage cooperation, collaboration, innovation and synergy in your teams; and you do this for most, if not all, the employees in the organisation, the whole system would function more effectively and as a result perform better”.

In conclusion, we see that a good appraisal system can have a significant impact on the whole organisation. Morgan went further by saying that employees who had personal development plans, and who had had a formal performance appraisal in the preceding year, had significantly higher engagement levels than those who did not. It is accepted that engagement is an important determinant of employee performance and that it positively influences organisational performance, productivity, retention, financial performance and shareholders’ returns. Promoting employee engagement is imperative and so it seems reasonable to ensure that managers who need to conduct personal appraisal sessions with their staff are trained, competent and comfortable in doing so in order to achieve optimum results for everyone concerned.

Ultimately, it needs to be made clear that appraisal systems require being constructive – as we need to examine our attitudes regarding employees and what motivates them. HR professionals and managers should feel comfortable measuring results and delegating accountability.