Performance Evaluations-Do we need them?

I have just recently finished our annual performance evaluations. I always find this time of year difficult. You want to provide meaningful feedback and give employees a chance to discuss any issues that have been weighing on them. At the same time I always wonder about whether the process is useful from the employees' perspective and if they feel engaged and motivated at review time.

There are some great tools out there to help with the process itself. StarGarden for example is able to mimic the performance evaluation process online using our StarGarden Federation toolset. We can build an online workflow that includes user-defined forms and then we can define the routing of the process to obtain appropriate management approvals. The process can even be designed to launch the salary increases that are the result of the review process. As with any tool though, it is only as good as the process the organization has designed.

I came across an article on the HR Reporter site by Brian Kreissl that gives a good summary of how to design and implement an effective performance evaluation process. Here is a portion of the article:

The following are some suggestions on how to facilitate effective performance management in your organization – grouped into five broad themes. While some suggestions are organizational or systemic in nature, others come down to individual managers. HR can help by providing appropriate coaching, training and communications around the performance management process. 

Goal setting and evaluation 

• Allow employees input into setting their own performance goals.
• Ensure employees develop “SMART” (specific, measurable, attainable, realistic and timely) goals as part of the performance planning process.
• Cascade clearly defined organizational goals and objectives. Ensure individual goals relate to organizational priorities.
• Ensure individual goals are congruent with the organization’s vision, mission and values.
• Ensure a similar level of challenge is built into individual goals and objectives for employees at the same level.

• Allow employees to change goals partway through the year where they no longer make sense.
• When evaluating the completion of goals, consider extenuating circumstances, shifting priorities and new organizational realities.  

Consistency

• Set objective standards of performance; ensure those are communicated across the organization.
• Train managers on employee performance standards and expectations – particularly with regard to the same or substantially similar roles.
• Develop, communicate and enforce performance distribution guidelines with respect to performance ratings. Apply those guidelines to larger groups (of perhaps 50 or more employees) to ensure alignment.

Fairness 

• Have some type of review process to ensure fairness and consistency before ratings are finalized and communicated to employees.
• Create an escalation or appeal process for employees who do not agree with their assessments; involve the manager-once-removed where necessary.
• Coach managers on how to avoid bias and favouritism; include suggestions on avoiding rater errors such as recency, primacy, central tendency error and the halo/horn effect.  

Process 

• Develop and communicate expectations and timelines well in advance.
• Provide employees an opportunity to complete a self-assessment.
• Ensure managers take the performance management process seriously and actually set aside time to complete performance reviews.
• Obtain buy-in from unions where applicable.

Communications 

• Ensure managers actually have a performance review discussion with their direct reports. Don’t just complete a form and hand it to the employee.
• Provide training to managers on how to handle difficult performance conversations without demotivating employees.
• Ensure managers have ongoing performance discussions, feedback and coaching sessions with their direct reports. Remember, nothing in a performance review should come as a surprise to the employee.
• Include both positive and negative feedback in the review. Don’t personalize negative feedback.
• Ensure managers provide adequate context for performance management by explaining what’s required of employees. What does superior performance actually look like?
• Explain the link between pay and performance where applicable.  

The full article can be found here Should Performance Appraisals be Abolished?