Effective Performance Appraisal Processes

Annual employee performance appraisals can be an arduous task when considering employee attitude and the clarity of communication between the employer & the employee. In this edition of Astronology®, we consider the topic of performance appraisals, how they can be instrumental in monitoring employee performance & rewarding employees, and techniques to make the process more effective for all involved.

There are several different methods for conducting performance appraisals. One is not the best, nor is there a “right” or “wrong” option. The most effective approach is the one that facilitates communication and professional growth while taking into consideration the number of employees in the organization, the types of jobs employees hold, and the organization’s culture. Four of the most common performance appraisal approaches include the following:

• Rating Scales: The employer establishes the key areas used in evaluation, such as job skills, teamwork, communication skills, reliability, and flexibility. Reviewers rate these areas accordingly on a scale, such as one to five (one = worst, five= best). The scale also can consist of unsatisfactory, satisfactory, and exceptional ratings. This approach is used often with managers who work with a large number of employees who mostly do the same daily tasks. This approach makes it easier to complete a mass number of reviews while saving time and money.
• Objectives and Metrics: This approach allows the employer to define the employee’s job description and to set goals with a designated time to achieve them. Goals can include sales, production, or organization tasks. Employees should have a clear understanding of their new goals and how the evaluation rating functions.
• Self-Evaluation Forms: If done correctly, the self-evaluation approach can provide great insight into an employee’s perception of his/herself and how he / she fits in an organization. These self-evaluation forms are created in connection with management evaluation forms. When discussing the responses, honest communication can help target what goals have been met, what goals haven’t been met, and what actions can be taken to achieve these, as well as new, goals. By collaborating with the employee, employers can identify why a valuable employee isn’t performing to par and how to find the proper training for continual development.
• 360 Degree Feedback: This is another performance appraisal method that is quite collaborative. A 360 degree feedback approach includes input about the employee from the employee’s fellow co-workers, internal & external customers, and management. This process of gathering feedback can be done via survey or interview, depending on the scope of outside involvement and the number of items to be evaluated. Such feedback is then consolidated based on demographic, such as co-worker or customer, and shared with the employee. This approach provides a more rounded perspective on the employee’s overall performance throughout the review period.

Proper execution should be considered before implementing any performance appraisal method. If a manager only provides negative feedback, without balancing the review with either positive comments where truly applicable or positive encouragement towards achieving professional growth, the employee may perceive the review as unfair or biased. Similarly, reviews with all praise and no areas of improvement can provide employees with an inflated sense of accomplishment that could backfire, leading to casual performance afterward.

It’s essential to also remember that in order for any performance appraisal method to work, Human Resources and management both need to be diligent & accurate in their recordkeeping. Moments of high performance, moments that lack professional performance, and disciplinary actions recorded for yearly review all help the appraisal team to achieve a well-balanced view of an employee and his / her contribution to organizational success.

For a performance review to be successful, it needs to be active and motivating. As such, always plan the next step: the follow-up action. Follow-up actions include establishing new measurable goals, while discussing areas needing improvement and associated development steps. Schedule a follow up meeting for matters that can’t be resolved in the moment of the performance review.

Performance reviews don’t have to be challenging from a technical perspective. If you would like to learn more about cloud-based performance appraisal or performance management options, give Astron Solutions a call. Flare®, our cloud-based talent management system, includes a performance appraisal module that will allow your organization to achieve more effective performance review meetings!

If your organization is considering doing away with annual performance reviews, be sure to check out our Astronology® archive for more information on the topic. Whether your organization uses appraisals or is moving away from the process, we’d love to hear your thoughts and experiences. Please share with us in the comments section!

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