Performance Reviews: All Pain, No Gain

employee, human resourcesFew activities in the workplace polarize like employee reviews. Some see them as subjective, one-sided and something companies should eliminate entirely.

By Mel Kleiman, Contributing Editor.

I despise performance reviews. In my 30-plus years of running a business, speaking and consulting, I’ve found that my personal distaste for performance reviews is shared by so many others that it’s nearly universal.

So, if no one likes them and their effectiveness is questionable, why does everyone keep using them? “Just because we’ve always done them,” is not a good reason. It may be time to ask:
1. Why do performance reviews?
2. Are they producing the intended result?
3. What are their benefits and drawbacks?
4. What kinds of legal liabilities do they create?
5. Are they an efficient use of our time and resources?
6. And, most importantly, could we achieve the intended result another way?

The first performance reviews evolved from time and motion studies done in the early 20th century in the throes of the industrial age when there was a need to measure how many widgets per day/week/month a worker could turn out. They were used to determine whether an employee was above average and deserved a raise or, on the other hand, wasn’t up to snuff and should be paid less or dismissed.

As we moved from an industrial/manufacturing economy through a service-based market and into the information age, performance reviews have also evolved. Most employers still use them to allocate the limited resources of raises and promotions and most employees still tie their expectations of a raise and promotion to their performance reviews.

Forced to Find Flaws
Today, however, rather than measuring widgets per hour, the criteria include things like job knowledge, initiative, communication skills, cooperation, problem solving, planning/organizing and safety consciousness.

These kinds of subjective evaluations put managers in the uncomfortable position of judge and juror. With the exceptions of certain quantifiable criteria (attendance, punctuality and work quantity), most performance appraisal measures today are subjective, judgmental and arbitrary. Most managers dislike the process as much as their employees do. They know full well that complete honesty and candor in a performance review could compromise a
heretofore good working relationship or make a fair working relationship intolerable.

Since marking everyone “satisfactory” or “highly satisfactory” on all criteria would seem unprofessional or thoughtless, the process puts managers in the untenable situation of trying to avoid confrontations while still trying to find “something wrong” with most every employee.

If these flaws aren’t enough to give you good reason to question the whole process, ask yourself: “Of how much use can a tool that measures the past be? Is it helpful to focus on the past when nothing can be done about it now?” If you think it’s a good time to get people back on track when they’ve fallen short, or praise them when they have done well in the past, then think again.

If managers are only telling store employees how they’re doing when the performance review system forces them to, the chances of building a winning team are slim to none. Behavior, good and bad, needs to be recognized when it occurs. People need to be praised, corrected, offered more training or warned on the spot.

Once a year, or even every six months, is simply an exercise in futility. What’s the point of evaluating the past by means of this kind of arbitrary, judgmental system when our concern is about the future?

Because of these shortcomings, most managers procrastinate as long as possible when it’s time to complete performance reviews and employees, who are happy with their performance reviews, are few and far between. Can this be good for morale?

This is not to suggest, however, that the process doesn’t have some merit. On the plus side, thoughtful, thorough performance reviews let people know where they stand, where they’re going, where they can go and what’s expected of them.

Performance Expectations
Rather than eliminate performance reviews, what if we were to morph appraisals into “Performance Expectation Plans?” This seems to boast: “Let’s look to the future and decide together what we want to focus on and what we need to do to get there.” This promises to be a much more pleasant, productive experience for all. Here’s how it could work:

This should be a top down process that would start with the president or CEO. In this example, we’ll start with a category or shift manager who would complete their own performance expectation plan to spell out goals and objectives, areas needing improvement, and set overall expectations both for themselves, each shift and the employees for the next six months or the year.

Then the manager would discuss these expectations (in a group meeting or one-on-one) with the entire staff and ask them to use the plan to guide the employees as they complete their own performance expectation plan.
Employees would spell out what they could do to help meet the manager’s expectations and set some personal expectations for themselves. Then the manager would meet with each employee individually to go over both documents and agree on priorities.

College convenience store

Whether you have new employees or seasoned ones, they need to know what is expected of them to get the job done. When you start off by setting expectations correctly, you save time and money and get the job done properly.

The purpose of the meeting is twofold. One is for the manager to understand:
1. What is important to each employee?
2. What are their goals?
3. How can the manager help each employee meet these targets?

The second purpose is to ensure employees leave feeling:
1. They are valued team members.
2. They understand how important their job is and how it fits into the big picture.
3. They understand the role they’ll play in reaching these goals and agree to the manager’s expectations for the department as a whole and of them personally.

The agenda might look like this:
1. Set the Stage: The manager discusses general expectations and their importance to the company.
2. Focus on the Future:  The manager then talks about how the employee’s job fits into the big picture of not only their location, but companywide as well.
3. Compare Appraisals and Agree on Final Content: A two-way discussion of each major point takes place and concludes with an agreement about how to proceed.
4. Questions: The manager encourages employees to ask questions so their expectations are clear.
5. Closing: This is the time for a handshake or a pat on the back and to say something like: “Now that we’ve agreed on all our top priorities. I expect you’ll do a fantastic job.”

Rather than rehash past performance, a performance expectation plan with its focus on the future engenders enthusiasm, fosters teamwork and paints a clear picture of goals, objectives and priorities. In other words, no pain, all gain.

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