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Tips on Revising Your Appraisal Policy

From the December, 1995 issue of
HR Fact Finder

It's hard to say who dreads performance appraisals more--the boss or the employee. It's natural to cringe at the thought of hearing or reading a description of our weaknesses, but few people enjoy being on the judgment end of those conversations, either. For all their unpleasantness, however, performance appraisals serve a vital purpose in managing people and meeting company goals. They deserve serious attention and thorough preparation.

In a series of separate company-wide studies during the past few years, employees have reported that most performance appraisals are non-specific and inconsistent with actual performance. They feel the meetings are handled poorly and dominated by one-way delivery. There is little or no constructive suggestion for improvement, and a troubling number say the individual has no input at all. Many view it as a mechanical process that is just part of playing the game.

Fortunately, several large corporations are leading the way in making performance appraisals more than just an annual check-the-box form. Herman Miller, Inc., for instance, recognizes the performance appraisal as an opportunity to build relationships between the employee and supervisor. A manager in a healthcare organization says she likes to use performance appraisals as a way to "kick up the employees' thinking, away from task orientation and toward the larger strategy of the organization."

If your company needs to revise its policy on performance appraisals, here are some tips to consider.

  1. Make sure everyone is subject to evaluation, from the president down. If it's clear that managers and supervisors who give appraisals will also be judged on the quality of those reviews, everyone in the organization will feel more commitment to the process.
  2. Spread the appraisals out throughout the year, rather than bunching them up in December or at the end of the fiscal year. You will not have sufficient time to devote to each if you are facing a big pile of appraisal forms all at once.
  3. Be aware of the legal considerations and confidentiality issues. Decide where the appraisals will be kept and who has access to them.
  4. Encourage self-evaluation as part of the process. Don't worry that this procedure will invite disagreement. Industrial psychologists will tell you that most people rate themselves the same or lower than their manager will.

    The benefit of self appraisal is that managers frequently don't know all the details of what's required to get the job done. The best manager I ever had asked me to write up my own performance appraisal, exchange it with his, review it, and then meet to discuss it. We both learned a lot.

  5. Consider having peers conduct reciprocal reviews and having subordinates evaluate their boss.
  6. Make clear the relationship between salary setting and performance appraisals.
  7. Determine how much of the review will be based on personal observation and interaction, and how much will rely on input received from others. The American Management Association offers classes and books on various methods for evaluating standards of performance, such as management by objectives, essays, graphic rating scales, weighted checklists, behavioral anchored ratings, forced choices, critical incidents, rankings, and paired comparisons.

    Some companies also use external sources of information. One of Apple Computer's top managers, for examples, talks to five or six customers of each salesperson he evaluates. This is a time-intensive method (he actually spends about 100 days a year reviewing his 25 direct reports), but it may be justified by results.

  8. Use performance appraisals as a chance to clarify job descriptions, but make it known that duties and responsibilities are different from performance.
  9. Be sure performance appraisals include objectives for the coming year, and then FOLLOW UP.
  10. Use your Human Resources staff to coach and counsel managers in the art of performance appraisal. It's not a skill that comes automatically with promotion.

The most effective performance appraisals don't just happen once a year--informal versions occur continuously via casual feedback. Think about it, if you're worried that once a year you may get a manager's elbow in the teeth, you will be anxious and eager to avoid the formal performance appraisal process. If, on the other hand, you know from day to day what your manager thinks (good and bad), your anxiety drops, and you're ready to be part of a valuable conversation about your job's goals and objectives.

Ultimately, the best performance appraisals flesh out what the person has known all year long. It's not just a look at results, but a time to set quantitive and qualitative objectives and to discuss where the employee is going in the future.

Peta G. Penson, Ed.D., principal with CDI, Co-Development International; (408) 366-0466.

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