performance appraisals webinar
TRANSCRIPT
Performance Appraisals: A Broken Prac3ce
Anu Mannathikuzhiyil HR Generalist
What will be covered
• Problems with the tradi3onal performance appraisal (PA) system • Employee problems, manager problems and problems for the organiza3on as a whole
• Effec3ve tools that measure performance with valid outcomes
Defini3on
• “The prac3ce of performance appraisal is a mandated process in which, for a specified period of 3me, all of a group of employees’ work performance, behaviors or traits are individually rated, judged or described […] and the results are kept by the organiza3on”
Source: Coens & Jenkins, Abolishing Performance Appraisal:
Why They Backfire and What to do Instead (2009)
A simple process?
Head of HR Department: Determine salary increase guidelines,
forward guidelines to managers
HR Department: Inform all managers of impending
performance review dates, distribute a list of their employees to each
manager and request iden3fica3on of co-‐workers who regularly interface
with each of these employees
Manager: Return completed co-‐worker list to HR
HR Department: Select co-‐workers to complete peer review, forward peer review form to
selected reviewers, forward managerial appraisal forms to every
company employee
Employee: Return managerial appraisal forms
and peer review forms as appropriate to HR
Manager: Request comple3on of self-‐appraisal
from each employee
Employee: Complete performance self-‐appraisal
and send to manager
HR Department: Assemble and distribute performance review packets for each manager
Manager: Review records and files pertaining to the review period and go through peer
review and self-‐appraisal forms
There’s more?! A
Manager: Write performance review
No Manager: write performance
review
Salary adjustment
is appropriate?
Manager: Complete employee profile
Manager: Forward performance review documents to manager for
approval
Manager’s manager: Review performance review
documents
Performance review
approved?
Manager’s manager: Discuss concerns with
employee’s manager and resolve difference
Yes
No
B
Review needs to be rewriaen?
No Manager’s manager: Sign and return performance
review documents
C
Yes
AYes
Are you serious?
Manager: Schedule and conduct
performance review with employee
Employee wishes to study the review?
Yes Manager: Provide copy to employee
Employee: Study review and prepare
comments. Meet with manager to discuss
Manager: Aaach employee comments to
review, if provided
Manager: Ask employee to sign review
No
Employee refuses to sign?
Manager and HR Rep: Meet with employee to discuss
issues and concerns
Employee: Sign performance review
Yes
No
Finally!!! Manager:
Distribute copies of performance review and send
original copies to the HR Department
HR Department: Record results of performance review and enter performance
ra3ng
HR Department: File review documents in employee personnel file
Salary adjustments required?
HR Department: Forward Employee Profile to
payroll
Yes
End
No
Did I lose you?
Issues: Just to name a few
• Does not assess actual performance • Infrequent feedback • Discounted from rewards • Lack of accountability
Issues: Just to name a few
• Liale legal support • The factors are all equal • Inconsistent ra3ngs on same forms • Not coordinated with business cycle
Variables Affec3ng Performance
• Personal life • Sickness • Stress • Inadequate amounts of sleep
Rater Bias
• Halo/Horn effect • Leniency error • Self-‐serving bias • Recency error
Unintended Consequences
• Long-‐las3ng psychological effects • Feelings of unfairness and ineffec3veness • Dissa3sfac3on • Fear/Dejec3on • Anger
Organiza3onal Problems
• Average cost-‐ over $2,500 per employee • Average 3me per year (employee): 3 hours • Average 3me per year (manager): 400 hours • Rates of voluntary turnover increase aler review periods
By The Numbers
• 66% of employees say the performance review process interferes with their produc3vity
• 65% say it is not relevant to their jobs • 90% of HR professionals do not believe their companies’ performance reviews provide accurate informa3on
• 95% of managers are not sa3sfied with their organiza3ons’ performance management processes
Source: Corporate Execu<ve Board
What you can do
• Move towards a Performance Management Model
• Organiza3ons need to “focus on improving the overall system of the organiza3on, instead of individual performance”
• Companies that have eradicated tradi3onal PAs from their annual processes are rated highly in employee surveys
Alterna3ves
• Journaling • Decide between a monthly or quarterly 3me range and set reminders for both the manger and employees • Have employees send 3-‐5 accomplishments from the previous month/quarter
• Have employees send 3-‐5 goals for the current month/quarter
• Manager should provide feedback for accomplishments and goals • Does not need to be for each point and does not need to go into great detail
• Engage in high-‐quality one-‐on-‐one conversa3ons with employees
• Schedule a session every three to four weeks
• Fosters professional development
Coaching
Benefits
• Call for a constant flow of feedback that gives employees direc3on, provides paths to career developments
• Keep both the manager and the employee aware of each other’s professional wants and needs
Performance Previews
• Discussions about how to improve working rela3onships in the future to meet specific goals
• “I” statements from manager and employee
Feedback Ques3ons
• Is this role living up to your expecta3ons? • When people ask what you do for a living, are you proud?
• Do you feel comfortable voicing your ideas?
Adobe’s “Check-‐In”
• Used to rank employees on a scale from 1 to 4
• “Soul-‐crushing exercise” • Caused spikes in voluntary turnover
• 2012-‐ replaced rankings with frequent informal conversa3ons, no annual ra3ngs
• Es3mated savings: 80,000 hours a year, 40 full-‐3me posi3ons
Deloiae’s Performance Management System
1. Given what I know of this person’s performance, and if it were my money, I would award this person the highest possible compensa3on increase and bonus
2. Given what I know of this person’s performance, I would always want him or her on my team
3. This person is at risk for low performance 4. This person is ready for promo3on today
Future Focused Statements
Benefits
• Less of a 3me commitment • Less money spent regarding produc3vity
• Surveyed employees highly rate these new methods, and call them more effec3ve
• Builds rela3onships between managers and employees
• Improves produc3vity • Helps support a high-‐performance culture
Summary
• Performance appraisals cause more problems than they solve
• Adop3ng a performance management style will help alleviate all, if not most, of the problems with PAs
• If you want to s3ck to a PA model, there are ways to tweak the process to alleviate issues
HRCI Cer<fica<on Credits: "This webinar has been pre-‐cer3fied for 1 hour of general recer3fica3on credit toward PHR, SPHR and GPHR recer3fica3on through the HR Cer3fica3on Ins3tute. We will send out a confirma<on e-‐mail to all those that are confirmed as aGended with the program ID code to note on your HRCI recer<fica<on applica<on form.
The use of this seal is not an endorsement by the HR Cer3fica3on Ins3tute of the quality of the program. It means that this program has met the HR Cer3fica3on Ins3tute's criteria to be pre-‐approved for recer3fica3on credit."
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