Performance Appraisal: Questionable Tool for Assessing Employees

11 Mar 2013

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By Linda Eroke

The process of performance appraisal or performance review as traditionally practiced in organisations is said to be fundamentally flawed as experts believe the approach is incongruent with the values, vision, mission of today’s business.

Although not every expert agrees that performance appraisals should be totally abolished, some say the system can be valuable if well executed. But in today’s work environment, the reviews carried out by management are questionable and in some cases office bullies have been known to use performance reviews to undermine employees.

Moreso, performance appraisals sometimes have the reputation of creating workplace tension between supervisors and their subordinates.

Given this scenario, experts have argued that the adoption of a performance management system will improve both employee performance and employee motivation in the workplace. This system, they explained, goes beyond the annual appraisal as it is aimed at continuous development of the employee.

Performance Appraisal and Job Performance
The fundamental purpose of any performance appraisal to improve workplace performance by  helping employees understand their role, to maximise their chances of success within the working environment, help plan their career, and help their organisation to succeed.

However, there are divergent views regarding the process of appraisal as some experts have described traditional performance appraisal system as an aggression tool used by management on their employees while others are of the opinion that the belief stems from a lack of understanding amongst both management and staff members of the underlying purpose of the appraisal.

For instance, Samuel Culbert, a clinical psychologist who teaches at the Anderson School of Management at the University of California, Los Angeles, USA, said annual reviews not only create a high level of stress for workers but end up making everybody - bosses and subordinates - less effective at their jobs.

According to him, reviews are so subjective - so dependent on the worker’s relationship with the boss - as to be meaningless, adding that he has heard from countless workers who say their work life was ruined by an unfair review.

Similarly, Kevin Kruse, author of Employee Engagement, described the annual performance review - as it’s traditionally practiced - as an evil, toxic ritual that must be abolished. He argued that performance appraisals are based on preset, generalised “standards” that are vague and subjective.

“Just do a Google search on ‘performance review standards’ and let the hilarity begin. Perhaps you’ve encountered: Initiative, Creativity, Problem Solving, Knowledge of Work, Quality, Organisational Skills, Professionalism, and Motivation. What do these things really mean and what are the odds that managers across the organisation are interpreting them in the same way? Is there any proof that the standards on the performance review correlate to specific job performance?” he asked.

Speaking further, he said the appraisal is tied to compensation. He explained that “People love feedback when it makes them better and gets them closer to their goals. But receiving constructive criticism that drives the size of your raise down can only be greeted with fear and disappointment. Also, for the managers who have hearts, they don’t want a flawed review system to negatively impact someone’s take home pay. So they artificially inflate the scores and comments on the review, which of course, helps nobody to get better”.

An expert, Susan Heathfield, also opined that performance appraisal or performance review as they have traditionally been approached in organisations are fundamentally flawed, adding that it smacks of an old fashioned, paternalistic, top down, autocratic mode of management which treats employees as possessions of the company.

She observed that in the conventional performance appraisal or review process, the manager annually writes his opinions of the performance of a reporting staff member on a document supplied by the HR department. She noted that “In some organisations, the staff member is asked to fill out a self-review to share with the supervisor” adding that most of the time, the appraisal reflects what the manager can remember; this is usually the most recent events. “Almost always, the appraisal is based on opinions as real performance measurement takes time and follow-up to do well”.

According to her, performance appraisal does not work because managers lack skill in providing feedback and often provokes a defensive response from the employee, who may justifiably feel he is under attack. Consequently, managers, she stated, avoid giving honest feedback which defeats the purpose of the performance appraisal.

“Many managers are uncomfortable in the role of judge, so uncomfortable, in fact, that performance appraisals are often months overdue. The HR professional, who manages the appraisal system, finds his most important roles are to develop the form and maintain an employee official file, notify supervisors of due dates, and then nag, nag, nag when the review is long overdue.

“Despite the fact that annual raises are often tied to the performance evaluation, managers avoid doing them as long as possible. This results in an unmotivated employee who feels his manager doesn’t care about him enough to facilitate his annual raise.

“In turn, the staff member whose performance is under review often becomes defensive. Whenever his performance is rated as less than the best, or less than the level at which he personally perceives his contribution, the manager is viewed as punitive,” she explained.

Speaking further, she said disagreement about contribution and performance ratings can create a conflict ridden situation that festers for months and as such most managers avoid conflict that will undermine work place harmony.

“In today’s team-oriented work environment, it is also difficult to ask people who work as colleagues, and sometimes even friends, to take on the role of judge and defendant. Further compromising the situation, with salary increases frequently tied to the numerical rating or ranking, the manager knows he is limiting the staff member’s increase if he rates his performance less than “outstanding”.

“It is harmful to performance development; damages work place trust, undermines harmony and fails to encourage personal best performance. Furthermore, it under-utilises the talents of HR professionals and managers and forever limits their ability to contribute to true performance improvement within your organisation”, she added.

Adoption of Performance Management System
She therefore proposed a performance management system to replace the traditional approach of performance appraisal in the workplace.

Performance management, she said, “starts with how a position is defined and ends when you have determined why an excellent employee left your organisation for another opportunity”.

“Within such a system, feedback to each staff member occurs regularly. Individual performance objectives are measurable and based on prioritised goals that support the accomplishment of the overall goals of the total organisation. The vibrancy and performance of your organisation is ensured because you focus on developmental plans and opportunities for each staff member”.

She further explained that “In a performance management system, feedback remains integral to successful practice. The feedback, however, is a discussion. Both the staff person and his manager have an equivalent opportunity to bring information to the dialogue. Feedback is often obtained from peers, direct reporting staff, and customers to enhance mutual understanding of an individual’s contribution and developmental needs.

“This is commonly known as 360 degree feedback. The developmental plan establishes the organisation’s commitment to help each person continue to expand his knowledge and skills. This is the foundation upon which a continuously improving organisation builds.”
She emphasised that the adoption and implementation of a performance management system is a wonderful opportunity for the HR professionals as it challenges their creativity, improves their ability to influence and allows them to foster real change in their organisations.

Similarly, Career Advice article by pointed out that a good appraisal system should not just be focused on deciding how the employee performed in the past year and decide the compensation structure based on this information, but should be aimed at continuous development of the employee.

“The appraisal system should be focused on bringing the best out of the employees. The aim should not be just finding out how the employee performed but also what skills helped the performance or what weaknesses affected it. It should be able to clearly list out the strengths of the employee and how it can be put to optimum use. It should also be able to figure out the improvement areas that the employee needs to work on.

“After identifying the strengths and weaknesses of the employees, the appraisal system should allow for identifying the kind of support that the employee will need to better performance. It should also help create improvement plans for the employees to help them perform their best. For example, it can include identifying weaknesses and suggesting trainings based on them.

“Putting together an effective system is not an easy task. But, it has become very important in today’s times where recession has already hit industry profits and there is no future for the not-so-deserving candidates. A good appraisal system should clearly identify each employee’s value in the organisation for the success of the employee as well as the organisation,” it noted.

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