Dec 02, 2016

Performance appraisals (PAs) are not new; they go back centuries. A Chinese philosopher of the 3rd century criticised a rater he felt was biased, claiming he “seldom rates workers according to their merits but according to his likes and dislikes.”

Robert Owens in his cotton mills in Scotland, in the early 1800’s, had wooden cubes of different colors indicating different degrees of merit hung over each worker's workstation. If performance changed, so did the color of the cubes above his head.

Like many other management concepts, the concept of performance appraisals were used during WWI and WWII to determine who would get promoted.

By the 1950s, PAs were in larger organisations, primarily for the lower level employees. (Managers were exempt.) In the beginning of the twenty-first century, however, PAs are nearly universal at least in theory.

However, many are done poorly, and many organisations are still in “to-it” mode: they are going to do appraisals when they get around to it.

A recent study published in Success magazine, showed that organisations that do performance appraisals are generally more successful than organisations that don’t do performance appraisals or do them poorly.

What are the major concerns?

Researchers discovered that employees have five major concerns about appraisals:

1. They are not happy if their performance is reviewed or appraised by someone who is not their direct supervisor.
2. They want to be reviewed by somebody who knows their work and what the work consists of.
3. They are not happy if there is no opportunity for them to tell their side of the story. They want two-way communication with their review.
4. Employees are not happy if they get generalities in their discussions. They want specific feedback on their performance and specific suggestions for improvement.
5. Employees are unhappy if they make a commitment to change and there is no follow-up on that commitment.

How to address these concerns?

As managers and team leaders, this can give us some food for thought. What does this research tell us we should be doing?

• Make sure team leaders are able to do performance evaluations for their employees.
• Learn how to conduct two-way feedback and interview sessions.
• Get better at observing behavior and learn to those observations translate into specific comments.
• Remember to follow-up on performance commitments.

Trust

A level of trust is another important component of the performance appraisal: more trust between employees and the organisation, more trust between employees and their team leaders, and more trust in the appraisal process.

What develops trust between employees and team leaders/managers? In general, trust is highest when these elements are present:

• Good working relationship
• Well-defined roles
• Specific feedback
• Honesty
• A low tolerance for political manipulation

In general, high trust means high acceptance and high acceptance means more effective performance appraisals.

Useful web links:

http://www.cognology.com.au/
http://www.hr.emory.edu/eu/performancemanagement/forms.html
http://performancereviews.net/employee-evaluation-form/

For more information, take a look at New Horizons' Professional Development training courses.