Getting more value from the appraisal process


Personnel Today looks at how the appraisal process can be best utilised.

Manager sits down with employee. They discuss how work has gone for the past 12 months, run through a checklist of questions provided by HR and set targets for the next 12 months. The relevant forms are filled in, then put aside until it’s time to start the whole process again one year later.

This is the view that many employees – and indeed many managers – have of the appraisal process. “Everyone is aware that it’s a problem area and it is recognised that the process doesn’t work very well, but I don’t think everyone sees what else could be done,” says Neil Morrison, HR director at Random House Group.

Career development

New research by recruitment consultants Badenoch & Clark backs up this view, with over one-third (37.4%) of UK workers saying appraisals are a waste of time and do not contribute towards their personal career development at all. At a time when encouraging employees to expend some discretionary effort could really make a difference, why are employers getting it so wrong on appraisals?

Most HR professionals accept that, as a concept, appraisals are a good thing – an opportunity for managers and employees to sit down and discuss performance, career development and how personal aspirations can be achieved alongside business needs.

“At Random House, we talk about what has gone well, what hasn’t, why and ask: ‘What can we learn for next year?'” says Morrison. “These are the essentials of good performance management.”

Overcomplicated process

Morrison agrees with the idea of appraisals, but what he doesn’t agree with is the process that many organisations get bogged down in: “I think we have overcomplicated and over-manufactured the whole performance management and appraisal process, losing sight of the true purpose and value of having a quality conversation.

“It has become a compliance issue, and more about completing a form and the ratings that an organisation uses. Part of it is the problem of HR people over-engineering a process that then becomes quite alien to managers and employees.”

Tick-box exercise

Once this happens, people tend to lose faith in the process and see it as a tick-box exercise. Rather than giving managers a list of questions to ask and forms to complete, HR should encourage managers to have in-depth, honest conversations with employees. Some managers find it hard to have those conversations, particularly if there are tricky performance issues that need to be addressed. This is where HR can help managers, by giving them the support, training and guidance that is needed. Are these managers good at managing people? Are there any personality clashes that need addressing? How are a manager’s listening skills? Are they equipped to deal with performance issues?

If a manager needs training in softer skills in order to be able to conduct good appraisals, then they will mostly likely need those skills for everyday people management throughout the year. This means there can be a beneficial knock-on effect for managers, employees and the organisation as a whole should that need be identified and addressed.

Simon Foster, client solutions director at HR solutions provider Kenexa, thinks many managers find appraisals hard. Indeed, a survey by XpertHR earlier this year found that the majority of managers are ill-equipped to deal with performance issues.

“A lot of people don’t find it easy to set good objective goals that are linked to the person and the organisation,” Foster says. In order to set meaningful goals, managers need good performance management skills and a clear understanding of the abilities and personality of the employee in front of them. They also need to have solid, impartial evidence of that employee’s performance that has been regularly gathered throughout the year, preferably backed up with unbiased and anecdotal input from colleagues.

Reviewing progress

Those managers who are good at doing appraisals tend to be those who are also good at managing people overall. They know whether or not things are working, because they are having these types of conversations throughout the year and reviewing progress constantly.

“A person’s only career conversation should not be in this one meeting,” says Nicola Linkleter, managing director at Badenoch & Clark. “If you don’t get together and talk about issues for another six – or even worse, 12 – months, it does turn into a tick-box exercise.”

Formal appraisals

Linkleter thinks it is okay for senior managers to have a formal appraisal just once a year, but that for more junior staff, she belives there should be a company policy of a formal meeting on a quarterly basis.

And when it is time for the formal meeting, Foster says, managers need to be prepared and take it seriously: “Appraisals don’t work when a line manager doesn’t want to be there, when neither side is prepared or if people think it’s a foregone conclusion and the outcome is irrelevant. Too many people think: ‘HR has asked us to do this, so let’s get this over and done with’. Managers need to see it as a business imperative.”

When neither the manager nor the appraisee thinks appraisals are worthwhile, it is time for HR to look at the process to see if it is working across the company as a whole and where improvements can be made.

Appraisal processes

Deborah Allday, senior partner at global management consultancy Hay Group, agrees that many appraisal processes need a shake-up: “Our recent research revealed that the majority of managers do not use appraisal or other performance management processes well. They don’t prepare well enough for them, don’t take the time needed and don’t follow-up after the appraisal discussion to ensure the employee is getting the support needed to improve.”

This is despite the fact that when done well, appraisals can really improve employee engagement levels and productivity. “And they don’t cost anything,” adds Foster.

Linking pay and bonuses

Some organisations link pay and bonuses to the outcomes of appraisals. However, Morrison thinks there is an inherent problem with this approach, in that it discourages frank, honest discussions: “If it is linked to pay, it’s less likely that a person will highlight areas that have not gone well. It doesn’t encourage self-assessment because people will be trying to justify their performance.”

When financial remuneration is not attached to the outcome of an appraisal, managers and appraises are more likely to have open, in-depth conversations about what has and what hasn’t worked. As this is what appraisals are supposed to be all about, it is worth protecting.

For more information see XpertHR’s briefing on conducting effective appraisals.

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