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Via The Southern Business Journal : Business Management – Let’s review the performance review

As I am writing this, the weather has finally turned from the blistering hot days of summer to the milder days of fall here in Southern Illinois. The third quarter of this year has come to an end. Some of us are assessing our year and may even be preparing for next year. The fourth quarter brings a very busy and chaotic time for most organizations as there are many things to do. The easiest thing in the world is to skip the often dreaded and never welcomed the performance appraisal process. Many of us struggle with this process because we know it is antiquated. It takes valuable time that many of us do not have. It is not a perfect system. What if there was another way?

This better way would need to reward high performers while keeping the much-needed performance dialogue going all year long. Our current one-and-done system really only addresses performance at the end of the year, months after the performance item has happened. Good or bad, you will hear about it a year later when it is too late to modify or teach to the behavior. What about the non-productive team members that need regular coaching? Speaking to them once per year is not good enough. They need support and motivation. Plus, as a leader, it helps if I have shared measurable goals that we can all work towards. Give me something real and attainable to strive for and talk about.

There is another way. Organizations are doing it. Some are getting rid of the system that we have come to think of as normal and just throwing it out the window and creating their own systems based on the needs of their business. What if instead of talking about what already happened once per year, you changed your model and moved to a forward-thinking approach? Why not talk about what should happen in the future? What you want to happen going forward instead of what already happened in the past? You have to admit, the standard model is old and tired. By the time we discuss performance for last year, the person’s performance (if they are smart) has changed drastically especially right before review and merit raise time. Some of the items that were issues seem like they happened so long ago because they did. Why bring them up now and throw salt in the wound?

There is a new system out there. In order to understand, you must free your mind of the old system. One example of this new system has been put in place by Symetra. I recently viewed a webinar where Anne-Marie Diouf, VP of Human Resources and Jennifer Sharp, AVP of Human Resources presented their program. This program centers around on-going and continuous feedback. If you truly consider it, this is the problem with the current system. Feedback is not timely. The review takes place up to a year after an incident either good or bad happens and the feedback is too late. This really is an opportunity missed. Immediate discussion or intervention is needed to change the behavior. If the behavior was good and/or something that we want to happen again, we missed an opportunity for positive reinforcement.

Now, making a major change like this would not be easy. In fact, it was not easy as Anne-Marie and Jennifer attested to during the webinar. They made it clear that they and their team constructed this program from the help of a consultant and some books but a lot of hard work. This was not a program out of the box. They had to hammer it out on their own to make it work for their organization of 1,600 people scattered across the country. Symetra created this program for themselves based on their wants and needs.

Symetra forged a new program that did the following:

  • Got rid of labels. You know, the labels given with review scores.
  • Involved the entire organization in their project. They met with senior leaders. They worked with people from every department.
  • Made compensation a separate process from ratings. Yes. I said this out loud. Compensation does not have to be tied to a rating on a performance review. If you think about it, it happens all the time.
  • Add in other rewards and incentives that are not part of this program.

If your process is accomplishing what it is intended to accomplish, you may want to keep it. Revamping a system like this can consume both time and resources. However, if your needs are not being met, don’t be afraid to think outside the box. We don’t have to do things this way forever. I am excited by what Symetra has done and look forward to hearing the success stories from others as well.

Via Forbes : The Right And Wrong Way To Conduct Performance Appraisals

Performance reviews are seldom something that employees look forward to. Despite their bad reputation, they can provide some invaluable feedback, however. Indeed, an analysis of them back in 2016 found that performance reviews do in fact provide valuable information to managers.

Despite the potential upside, they also run the risk of consuming large quantities of employee time for little reward. So being able to ensure that performance reviews deliver benefits to both parties can be a real boon to corporate productivity. That’s exactly what researchers from Columbia Business School believe they can do.

A recent study from the school finds that when reviews are conducted such that the employee is evaluated against their past performance rather than against the performance of their peers, the reviews are seen as fairer, which in turn improves both productivity and morale.

“Our findings show that, simply put, the process matters,” the researchers say. “Oftentimes, the performance review process can be viewed as uncomfortable, unfair and uninspiring. In order to improve upon the fairness factor and thereby better ensure employees accept the feedback, managers must acknowledge the individual identities of their workers and their specific contributions to the organization over time.”

The ideal performance review

The most common form of performance appraisals compare our current performance levels either with our previous performance levels or the performance levels of our peers. When the two approaches were compared, the researchers found that comparing our performance now with our performances in the past was more effective because employees regarded them as fairer, especially on an interpersonal level.

Respondents also regarded such reviews as more individualized, and this was valuable in signaling to the employee that they were important to their employer, and indeed to their manager. This opens them up to both positive and negative feedback during the review.

When we’re compared against our peers, however, the results are less positive. These social comparisons often lack any of the specific details we need to improve our performance, whilst they can also create an impression of being just another number in the workplace. This made employees less open to feedback, regardless of whether it was positive or negative.

The findings suggest that the best way to approach reviews is to ensure that there are at least some elements whereby the employee is compared against their past selves. This can also extend outside of the appraisal environment, with managers encouraged to treat employees as individuals.

When and when not to be social

By comparing performance against yourself, you can also make appraisals less subjective. A study published in 2016 highlighted the negative impact subjective reviews can have on employees. It found that when employees felt under-rewarded, their productivity dropped significantly, but the opposite didn’t appear to be the case when they were unfairly over-rewarded.

This sense of fairness and injustice can be hugely powerful, therefore. What’s more, it can be especially important when things such as salary, bonuses and promotions are wrapped up in your performance appraisal. Indeed, the evidence suggests that if you are going to make appraisals social, then it should be in how these bonuses are distributed.

A study from 2013 found that when employees were given so-called “pro-social” bonuses, i.e. bonuses that they have to award to a colleague, their own performance rises in turn. The study found that when a $10 bonus was given to a salesman to spend on himself, he only generated $3 in extra sales, so a $7 loss. When the salesman was given a $10 bonus to give to a colleague however, the pro social bonus yielded an extra $52 in increased sales.

So there are benefits of being social when it comes to performance appraisals, but it may well be in how bonuses and rewards are distributed rather than how performances are measured.

Via Forbes : Adapting The Performance Appraisal Process To Meet The Needs Of The Modern Workplace

As the end of the year approaches, many of us are facing the dreaded performance appraisal process that punctuates the year’s end and sets performance goals for the next. It wasn’t long ago that a number of reputable companies started abandoning performance reviews, citing such reasons as they’re time-consuming for both employees and managers, they can negatively affect employee morale and they don’t significantly impact performance. Employers such as Motorola, Deloitte, Microsoft, Adobe, Accenture and GE all jumped on the bandwagon, electing to ditch performance reviews in favor of more frequent one-on-one meetings with managers in an effort to provide feedback and keep employees on task.

As an employee of a company that continues to utilize annual reviews, and assist clients in their employee review process, I understand their value. If administered correctly, performance reviews can drive employee growth and departmental success. However, there are several who feel they’re just not a good use of time. Perhaps for many employers, the process is simply in need of repair, with the problematic areas requiring a bit of tweaking. For those companies that have always incorporated performance appraisals into their end-of-year process, eliminating the practice may not be necessary if the kinks can be worked out enough to yield positive results. Let’s take a look at some ways in which the performance review process often falls short, and how to remedy them.

Problem: There can be a lack of consistency in the evaluation process among management.

Solution: What one manager sees as excellent work, another views as just getting the job done, but not going above and beyond. While some managers see high marks as reward for a job well done and motivation for continued excellence, others see average or lower marks as even better motivation for employees to improve performance and surpass what they’ve already accomplished. Employers should provide training to managers on completing performance reviews. This shouldn’t be a one-time introductory lesson, but an ongoing, yearly review session to ensure that despite differentiating management styles and personalities, performance ratings and evaluations remain consistent.

Problem: Often, evaluation criteria aren’t tied to measurable outcomes. Managers are asked to rate employees on “customer service” or “communication,” leading to confusion as to what constitutes a good versus bad rating.

Solution: Managers should set employee goals linked to quantifiable results or goals. This doesn’t necessarily have to be in the form of hard numbers. Obviously, revenue-generating jobs require metrics. However, too often, hours are wasted trying to tie numbers requirements to non-revenue-generating jobs that don’t utilize them. Managers should be able to determine how well employees accomplished their job duties in a given year and what is necessary for improvement the following year. Employees must then figure out how to achieve this improvement in order to meet these goals for their next review.

Problem: Some employers use performance appraisals as a method of “weeding out” low performers.

Solution: A solid recruiting and screening process should prevent low performers from being hired in the first place. Of course, the occasional bad apple may slip through the radar of even the best hiring manager. But if the right due diligence is completed in the preliminary stages of hiring and managers are working regularly with employees on assigned tasks throughout the year, there should be no need for completing yearly checks of employees’ work output simply to rid the company of weak links.

Problem: Performance reviews focus on the past, looking back at employees’ completed work — and only once a year.

Solution: The past is past, and what’s done is done. In order to be truly effective, managers must look ahead at attainable goals for the upcoming year and consider how employees can accomplish them. This can only be done through regular one-on-one meetings between the manager and employee throughout the year in order to monitor his or her progress and determine what changes should be made in order to achieve the goals previously set. Once-a-year meetings looking backward will not achieve the same success as weekly or monthly meetings looking ahead.

Problem: The traditional manager/employee corporate structure is less common in today’s workplace, making employee performance appraisals more difficult.

Solution: There are far more rungs on the corporate ladder in today’s workplace than in previous years. Many employers are abandoning the traditional boss/worker hierarchy for a more fluid, project-based structure, emphasizing teamwork in an open-office environment. A few years ago, Zappos took it a step further when it announced it was eliminating all management positions, opting for a holacratic structure that assigns employees to multiple circles, each performing certain functions. The result is increased difficulty in one manager evaluating an employee’s performance. Employers may remedy this by allowing for peer evaluations and self-evaluations, enabling employees to measure each other’s performance, as well as their own, as they complete goals and projects throughout the year.

The performance appraisal process may be flawed, but not altogether broken. In today’s ever-changing workplace, the annual review should be flexible and able to adapt to changes in modern corporate structure. Additionally, employees must receive feedback far more often than once a year in order to ensure they’re on track to achieve performance goals. A rigid, formal, yearly performance review developed to evaluate an outdated employer/employee relationship will fall short in accurately measuring employee accomplishments and setting achievable future goals. However, if employers adapt their performance appraisal process the way they adapt their corporate structure, company culture and employee retention strategy, they will find it far more effective in accomplishing its intended purpose, as well as more widely accepted by both employees and management.

Via CIPD : Five ways to avoid appraisal pitfalls

With the annual review season upon us, Jonathan Maude provides tips for HR professionals on getting performance conversations right

1 Be honest

One of the most common things HR practitioners get wrong with appraisals is to gloss over inadequacies and avoid confrontation. Far from being harmless, being ‘soft’ and unwilling to address an employee’s poor performance can have a ruinous effect on the standards expected and the morale of co-workers, and in certain circumstances expose the company to claims of discrimination and unfair dismissal should the employee need to be dismissed at a later date.

In this uncertain world, with the spectre of Brexit looming, a company may decide it needs to downsize. If redundancies become needed, the appraisal is a first reference document to be considered when looking at which staff will stay and which may go.

2 Adopt the right tone

If the message is delivered in the right way – for example, in a more encouraging tone – then the messaging itself can be constructive and positive. It is more likely to be appreciated and taken on board by the employee. Equally, if there is a well-understood appraisal system and the culture is to provide honest and detailed feedback, this becomes the norm, and any confrontation should be avoided.

3 Train appraisers

Training needs to be given to the person undertaking the appraisal and the employee should be told what to expect from the process. So often a manager, who may be very good at their job, is put in charge of people and not given the right tools for the role. They need to be trained in how to deal with appraisals and how to deliver honest and constructive feedback to the employee.

Part of the training needs to focus on why this is an important task, not one to just tick off the list. For example, if it were to become necessary for a company to make group redundancies, then it will need to undertake a selection process of the affected employees to avoid unfairness in dismissals. The selection process may also give the company a defence to claims of discrimination, as it may be able to show objective justifications for decisions it has taken.

4 Get the data right

To follow a fair redundancy process in a ‘pooling situation’ employees need to be sifted. Various factors will need to be considered when ‘scoring’ employees, and performance is likely to be one. If appraisals have not been conducted properly there is no raw data to use in this process. The company will then end up making more subjective decisions, which will be subject to legal challenge by way of unfair dismissal or, in the worst-case scenario, discrimination claims.

5 Be objective

Aside from the legal issues, there is the fundamental business problem that subjective, ‘on the hoof’ decisions put the company at risk of letting good staff go and retaining the non-performers. This is bad for the company and its morale going forward.

Performance reviews, whether annual or more regular, need not be feared and loathed in equal measure. If the groundwork is done well and in a systematic way then both employer and employee know what to expect and both benefit.

Via INC : The Right Way to Conduct a 90-Day Performance Review

What is the right way to do an evaluation of a new hire?

Many companies have a 90 day “probationary period” for new hires. At the end of this, the manager is supposed to do a sit-down evaluation with the new employee. It’s such a standard thing that we often don’t think about it, but we should. It’s actually an area which can cause your business big troubles if you don’t do it right. Here’s the right way to conduct a 90-day performance appraisal.

Stop Saying “Probationary Period.”

This is not just a language thing–it’s a legal thing. In the United States (with the exception of Montana) all employees are at-will unless they have a contract (such as a union). You do not want to do anything to jeopardize the at-will status. So, stop referring to the first 90 days as a probationary period because it implies that the rules change at day 91. If you can be fired without notice on day 75, does the end of the probationary period mean something’s changed and now you can only be fired for cause? You don’t want to get in the legal battle over that. Just say, “We’re going to do a review at 90 days.”

Aim for 90 days.

We don’t call it a 90-day review for nothing. The 90 days isn’t critical. You could do a 60-day review, a 120-day review, or a 75.5-day review (over lunch!). The critical part is to do it when you’ve told the employee you will. Put it on the calendar on your new hire’s first day.

Why? Because performance reviews stress the heck out of your new hires. If you postpone or don’t get around to scheduling, it makes it difficult for your employee. She doesn’t know where she stands. So, if you say you’re going to do it, do it.

Have an Agenda

If you sit down and say, “So, how are things going?” you’re going to miss important things. You can certainly have that type of conversation, but not at an official review. A review should have, at a minimum, an agenda. If this is official company policy there should be a form.

You want to stick to the agenda and cover these things (plus whatever is important for the particular position).

Areas where the new hire needs additional training:

  • Cultural fit
  • Gaps in knowledge
  • Workload evaluation
  • Skills Fit
  • Employee’s observations
  • Things that need changing
  • Things that are working well
  • Make Sure the Employee Has a Chance to Speak

This is not just about you giving feedback, it’s about you receiving feedback. What is and what is not working? Are the improvements that your new hire wants to make? Are there concerns you should know about? It’s better to learn about these things now than have problems appear later on.

Remind the New Employee about Policies

Most people aren’t going to take a day off in their first few months, so they may have forgotten the proper procedures to request time off. The new employee may not have submitted an expense report or had to buy plane tickets for travel, but she will in the future. It’s a good time to go over these things to that the employee never feels uncomfortable.

And if the 90 Days Were a Failure?

If it was a total failure, then that should not be a surprise to anyone at the review. If you’ve been attempting to fix the problems for the past 90 days, it’s time to let the employee go. However, if it was a disaster because you didn’t provide training and support, you need to fix that. Bringing in someone new won’t fix the company’s onboarding process.

But, if the employee is definitely the issue, it’s better to part ways sooner rather than later. Get the paperwork in order and get everyone to sign off and bid the person good luck in their future endeavors.

Say Thank You!

You know what a new job is? Hard. It’s far more difficult than a job you’ve had for 3 years. You get decision fatigue just because everything is new–you have to develop new patterns and new techniques. You have to deal with new people and learn their quirks. It’s tough. So thank your new hire. She’s survived 90 days and that’s not easy. Let her know you’re thankful.