Conditions for Successful Performance Appraisals

Conditions for Good Performance Appraisals: 3 Ts
Pat Hannon, Member
In order to conduct effective PA the following are essential to create an ambiance resulting in a positive experience for the employee, employer and the organisation as a whole.
Timing, Trust, Tolerance.

Performance Appraisal (PA) Conditions
Hor Kam Peng, Member
Too many PAs are just another annual exercise. Those who did well during the year tend to look forward to their PA. So the head of the department would need to manage their high expectations at one end. And perhaps less driven and motivated employees at the other end.
Because of that, for a positive experience for both appraiser and appraise, there should be trust and openness, realistic goals, appreciation of organization's economics and opportunities.

Conditions for Successful Performance Appraisal
Paul Thompson, Member
In order to have a successful performance appraisal, the appraiser should be honest about what is stated about the appraise. The appraiser should not make comments or evaluation based on past evaluation, but should be focused on what transpired in the period under review.
At the same time, the appraiser should not use the exercise as an opportunity to settle score or hurt the appraise.
The appraise, on the other hand, should be open to learn and to grow from the exercise so that there can be evidence of development over time. The appraise should be willing to accept and realistic that there are areas of his or her performance which may come under severe or not so favorable rating.
The appraisal exercise also needs to be conducted in a non-threatening manner, so that the appraise does not feel that it is an attempt to 'get' him or her.

Performance Management Success Factors
Bernie Althofer, Member
Some organisations will have a well documented performance management policy and procedures that may be successful or not, depending on many factors, including: training, culture, reward and punishment systems, focus of the organisation, linkage of the system to other systems and processes and even whether or not there is top down leadership on the issue.
If managers and workers perceive that no great importance is attached to performance management, they will apply that same belief. In addition, if they perceive that communication and conversations are too time consuming, they may agitate for a 'tick and flick' approach that eliminates the need for ongoing or periodic discussions. The system becomes a 'once a year' task that is completed to meet compliance with little thought given to the benefits of performance management and appraisal.

Conditions for Valuable Performance Evaluations
Chloe Xu, Premium Member
I read a recent HBR article on this same topic. Here a short synopsis:
Systematic reviews on employee performance have long been criticized as awkward, biased, and inefficient on receiving feedback. Not surprisingly, at least 30 Fortune 500 companies had discarded performance evaluation by the end of 2015. But the reality is, ratings still exist wherein they have been got rid of. Those ratings are done subjectively, behind the scenes, and without input from the employee being evaluated.

A recent survey on performance management system among 300+ employees of Facebook indicated that 87% of interviewees reported they wanted to keep performance reviews. Because, even though performance evaluations are costly, they are considered fair and transparent, and allow for employee development.

• FAIRNESS. A fair process exists when evaluators are credible and motivated to get it right, and employees have a voice. Without systematic performance review, people are left in the dark about who is evaluating their contributions and how. 360-degree appraisals are the best fit as they are designed to minimize the ‘idiosyncratic ratter effect’, aka personal opinion. Moreover, a calculation formula that translates ratings directly into compensation can further increase the fairness, and improve effectiveness on compensation decisions at the same time.
• TRANSPARENCY. People want to know where they stand, and performance reviews offer transparency. Companies that are ditching the system often move to real-time feedback systems, which is an excellent way to help people repeat their successes and learn from their failures. But this doesn’t help them or the organization measure how they are doing overall.
• DEVELOPMENT. When performance feedbacks are near-constant and untethered by ratings, employees find it hard to figure out which information matters most and what to park for a while. In addition, when people receive negative feedback, they tend to fixate on small points. Performance appraisals allow for an overall assessment that helps people prioritize. They learn what they have been doing well and where they should focus their development efforts on.

Performance evaluations are not perfect, but getting rid of them entirely might be an overreaction. More important, when companies eliminate them, managers actually tend to devote less time on performance management. The solution is not to discard them altogether, but to transform them to build a culture that recognizes and rewards professional growth.

Source: Goler, L. et al. "Let's Not Kill Performance Evaluations Yet". Harvard Business Review, vol 94, no. 91-94, 2016.