Good performance management in practice.

 

How do you feel when your performance appraisal is approaching? Do you look forward to it as an opportunity to get recognition and feedback for what you have achieved in the past year? Or dread it, as it tends to focus on weaknesses or gaps? Perhaps you wonder whether it will be postponed due to ‘more important’ things. Annual performance reviews are dreaded by everyone – those who conduct them and those who receive them. The information is just too late, too general and too formalised to help anyone become better at doing their job. So, how can organisations get performance management right?

Recruitment – the critical first step

Performance management begins with recruiting the right person for the job. But of course, all manner of irrelevant factors may be unconsciously taken into account at interview stage. Things like what someone is wearing, or how tall and attractive they are have been shown to have a big influence on hiring decisions. But these have absolutely no impact on performance.

Using a variety of methods for selection helps recruit the best person for the job. These include objective evidence, such as educational achievements, psychometric tests to assess personality and intelligence, work samples (which require job candidates to perform a range of tasks that the job requires), and structured interviews (developed to assess the applicant’s suitability to the job you’re recruiting to).

Once the new recruit starts work, the line manager needs to explain clearly:

1. The role and what it entails;
2. What you expect to see your new recruit achieve in the first, second and third month;
3. What evidence will tell you that they have achieved it; and
4. What you want them to do if they encounter problems that they don’t know how to resolve.

This last point is important. It encourages open communication between the employee and line manager from the outset.

Most (sensible) organisations have a probationary period for the first three to six months. This enables both the line manager and the new recruit to establish the fit between the person, job and organisation at an early stage. Being clear about the measures for success enables this decision to be taken fairly.

The importance of regular feedback

The main purpose of an appraisal is to review performance, set goals for the future, and identify what the employee needs in terms of training, development, support and equipment in order to meet these goals. Appraisal can’t be done in a vacuum. It is critical to identify how the individual’s role and performance fit in with what the organisation is seeking to achieve, so they can see how their work contributes to the employer’s goals.

You may have heard the story of the US president visiting NASA in Houston. He stopped a cleaner and asked what his role was, to be told ‘I’m helping put man on the moon’.
Extensive research has shown that goals which stretch the individual, if properly set and agreed, along with development plans and relevant support, dramatically enhance performance and job satisfaction.

But is once a year enough? Not nearly. The appraisal or end of year review is the main opportunity that many employees have for a face-to-face discussion with their boss. And for many, their pay increase or bonus depends on it. Yet it is frequently not given the time and attention it needs – which is why timely and regular feedback is important.

Feedback, or rather feed forward (positive reinforcement of what needs to be done in the future) can be given through team meetings and to individuals. Do your homework; gather data and details to support your feedback. Always describe behaviours, not traits. Don’t dwell on the past; instead focus on what the employee can change in the future. Be sure to check for understanding and agree on clear next steps and a fair way to measure progress. And when performance falls short, timely feedback can help to address problems at an early stage, giving the employee an opportunity to improve before they pass the point of no return.

So, what are the principles of performance appraisal?

• Preparation, followed by two way discussion.
• Feedback, based on evidence of achievement or otherwise.
• An opportunity to consider strengths and how they can be put to best use.
• Identification of SMART [specific, measurable, appropriate, realistic, time bound] objectives for the next year – and it’s critical you record what success will look like here, so it is clear to both of you. In a year’s time you may not recall what seemed achievable, as the goalposts might have moved.
• Identification of any development requirements to enable the forthcoming year’s objectives to be met.
• Discussion about areas for growth, future career aspirations and ways of fulfilling them.

Appraisals are intended to be a positive experience for employees. They are an opportunity for dialogue, feedback and recognition of achievements. This is simple in theory, but managers often realise that they do not have the evidence, or are unwilling or unable to give appraisals the attention they deserve. Instead, they resort to gut feeling. Managers are employees too, yet so often they do not put their expectations of the appraisal process for themselves into practice. This is a do as I say, not as I do mentality. Often, too, the dreaded paperwork can be a barrier.

Focus on the positive. High performers often get great results, but it’s important to understand how they achieve those results, and sometimes at what cost. Unfortunately, top performers often get results by forgoing other things, such as caring for their people, building alliances with others, or maintaining a healthy work/life balance. In addition, a top performer’s strengths may often be their weaknesses. Sometimes the behaviours that enable people to succeed also may be holding them back – for example, someone who achieves great results may be a bit of a bulldozer.

I haven’t heard many anecdotes about performance appraisals being done well. Everyone has their own horror stories. My own was the time when my boss had to go home to look after his sick son and suggested that we had the appraisal meeting at his house. I found myself on a low chair in his study. I hadn’t realised that sitting at different levels could completely change the dynamics of the discussion.

Motivation and rewards

We have intrinsic and extrinsic motivators. We respond more to carrots and less to sticks, but most of all we do things because they are interesting and engaging; because we like them. We might respond because we’re part of a community, or because they give us some kind of purpose. Businesses often use money as a prime motivator but it doesn’t work nearly as well as we think.

In his book Drive – the surprising truth about what motivates us, Dan Pink states that there are three elements of true motivation:

• Autonomy – the desire to direct our own lives;
• Mastery – the urge to get better at something that matters to us ; and
• Purpose – the yearning to do what we do in the service of something larger than ourselves.

How does pay fit in? Pink suggests that the best strategy for organisations is to “get compensation right and then get it out of sight”. Effective organisations compensate people in amounts and in ways that allow individuals to mostly forget about compensation and instead focus on the work itself. This can be achieved by:

• Ensuring internal and external fairness;
• Paying more than average; and
• Making performance metrics wide-ranging, relevant and hard to fiddle.

This is food for thought in these days of organisations exploiting people in return for a job; expecting or encouraging long hours or unpaid graduate internships – for example, British Airways’ request to its crew to work for nothing.

There are a number of ways that organisations can encourage their managers to conduct appraisals more effectively. These include:

• Providing training;
• Including a review of the manager conducting the appraisal, by a more senior member of the management team;
• Focusing on strengths, not weaknesses;
• Asking employees to (anonymously) rate their manager on how effective the appraisal was; and
• Using continuous feedback.
For many, the appraisal is the only time employees are able to receive feedback on their performance, so making it a positive experience will increase staff commitment and reduce attrition rates. Good performance management makes good business sense.

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Hilary Jeanes is Director of PurpleLine Consulting Limited, a consultancy which helps organisations realise the potential of their people.

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