INFOMAXIUM
Performance reviews can be a valuable tool for companies, offering "an opportunity for every boss and their direct reports to agree on what is important, how to measure success or failure in the future, and how to reward it," says Akhil Bhandari, chief information officer at CCL Industries Inc., who has conducted hundreds of employee performance reviews
Unfortunately, too often performance reviews end up achieving precisely the opposite of their intended result. Instead of inspiring the troops, they demotivate them, causing frustration, dread and cynicism about the process.
Don't underestimate how often employers beat back their employees' motivation. About 41 per cent of workers have suffered from manager-induced demotivation at some point in their careers, according to a 2002 survey of 660 full- and part-time U.S. workers by Ken Greenberg-Edge Communications Inc., a Chicago-based coaching and training company.
Organizations often invest heavily in acquiring performance measurement tools and processes but lose their value by failing to monitor the effectiveness of these programs after their implementation.
"Even proven performance review processes can become too ritualistic and negative over a relatively short period of time," Mr. Bhandari warns.
He says never to underestimate the importance of continually measuring how employees are reacting to the processes and patching procedures when cracks appear.
Align objectives
Problems with performance reviews can begin when employees cannot link how their individual performance contributes to their company's larger corporate goals, says Dr. John C. Marshall, president of The Self Management Resources Corp., a Toronto-based human resources consulting firm.
Dr. Marshall suggests employees should be evaluated on criteria specific to their job and how it contributes to corporate value. For example, it may be more worthwhile to measure a call-centre analyst on the number of angry customers the analyst handles who leave satisfied rather than the number of calls answered every day.
Provide regular and consistent feedback
Performance reviews should be about summarizing feedback already provided to an employee throughout a reporting period, instead of saving it all for the face-to-face meeting. And feedback must be regular, timely, fair, specific, constructive and accurate to gain buy- in from employees, Mr. Bhandari says.
He stresses that there should never be any surprises during a review. Employees should know where they stand before the meeting. Disappointment and disengagement are guaranteed if unexpected negative feedback is suddenly tossed at them, he warns.
Do your homework
Everybody experiences the occasional bad meeting or project. Mr. Marshall warns that focusing only on these results, without looking for examples of strong contribution, will discourage employees and cause them to disengage from the process.
To be believable and win trust, managers must be thorough and rigorous in their background research. On finding negative experiences, they should try to sniff out positive examples as well. They should speak with colleagues, managers, clients and anyone else who has worked with the employee in the recent past. If the picture is negative, the manager should show how the conclusion was reached. In fact, many employees expect the same level of due diligence when receiving positive reviews as well.
Shorten the review process
Mr. Bhandari warns that review processes that require a lot of reading, writing or other forms of extensive advance preparation tend to be ignored until the last minute. Instead, a short form that contains key information about corporate objectives, the employee's goals and the actual performance results works better.
Making these available through the company's intranet or website, along with a short checklist that shows everyone what they need to do and by what date, is even better.
Weigh your criticism
Demotivating employees is easier than motivating them and far easier than remotivating them. Unbalanced criticism is the surest way to destroy trust and create defensiveness. Mr. Marshall suggests every performance review begin with a summary of all the positive things the employee did during the period under discussion. As a rough guideline, he suggests a ratio of five positive feedback statements for every negative one.
Use flexible rating systems
Back in 1981, General Electric Corp. CEO Jack Welch implemented a "forced ranking" model for measuring employees, which spelled out the exact number of ratings that could be given out at any given level (for instance, excellent, good, average and poor) so that no single rating category ended up with too many employees in it.
But a predefined or rigid result to satisfy is a common source of resentment for both managers and employees.
Mr. Marshall cautions against their use. While they can be valuable, he argues they can also reinforce mediocrity in the higher ranges while demotivating employees in the lower ones, who may feel -- rightly or wrongly -- they are only there to satisfy the predetermined requirement.
A better way is to provide guidelines but allow for exceptions or a 'skewed' distribution to reflect the unique culture of every organization.
Reward star performers James Fehrenbach, manager of staffing solutions for the University Health Network in Toronto, stresses the need to clearly tie rewards with performance. He suggests that the strongest performers need to be recognized with superior rewards. For example, a bonus pool based on performance demonstrates corporate commitment to results and will inspire other employees.
Listen and react
Nothing establishes a one-sided performance review more quickly than having a reviewer walk into a meeting with all conclusions already written down, then delivering them to the employee without asking for feedback.
Mr. Fehrenbach insists that differences of opinion between the reviewer and the reviewee must be actively sought out during the meeting, and incorporated into the written review. It may be better to have several review meetings between a manager and an employee before assigning a final grade.
Don't invent 'weaknesses'
Another sore point for employees, especially those who have enjoyed a spectacular year, is to have a reviewer keep digging for areas of weakness just to ensure that there is something to fill in on the "areas needing to be improved."
Mr. Fehrenbach suggests awarding the employee the higher grade and then focusing on areas of future growth. It may be semantics, but it directly affects the employee's motivation level.
Support transparencyWhile you may not want to publish individual review results on the corporate website, some degree of transparency is helpful in building respect for the process. Mr. Fehrenbach suggests sharing average statistics will provide needed clarity.
Be honest
"Even negative feedback that is perceived as honest and constructive is more appreciated than positive statements that lead nowhere," Mr. Fehrenbach says.
Follow up
Completing the review process but not following through on commitments made is a common trap.This includes paying out promised rewards, providing support for suggested improvements and future tracking in a timely manner, say no later than a month after the review.
Mr. Fehrenbach argues that even a good review will become demotivating if there is no follow-up. "Consider starting the next performance review session for the employee in, say, six months, with a review of the results of the current one," he suggests.
Learn from others
There are many sources on the Internet that offer useful performance review forms, tools and human resource-related best practices: Among them, check out:
www.opm.gov/perform/monitor.aspPerformance review processes can benefit from a dose of their own medicine. Frequently re-evaluate them against this checklist to ensure their continued value to the organization and its employees.