Building a Better Performance Review

Inroduction

I became interested in this topic awhile back while I was receiving one of my annual reviews. I could not stop thinking about how difficult it must be for a supervisor to develop on a continual basis several individual reviews for large department and still be unique and objective review after review. It became even more apparent to me how little I knew about the process, when I was promoted into a coaching position and was allowed to begin giving input on my team memberÐŽ¦s performance reviews.

Although I have no complaints about the current review process in my company, I often wonder if there is not a better or easier way to go about the process. So my question is: What, if any, are the alternatives? In this paper, I will review the aspects of the traditional performance appraisal, the 3600 degree performance review and Debundling, an alternative approach to the traditional performance appraisal proposed by Peter R. Scholtes in The LeaderÐŽ¦s Handbook, in an attempt to build the better performance appraisal.

The Traditional Performance Appraisal

Most often the performance appraisal for employees is conducted once a year and traditionally is a backward looking event. The process is based on a rating system and sums up what has been discussed and accomplished throughout the previous 12 months. The purpose is to give an employee opportunities in areas that need to be further developed. Performance appraisal for evaluation using the traditional approach serves the following purposes: (Grote, p. 4-5)

„П Promotion, separation and transfer decisions

„П Feedback to employees about their performance

„П Evaluations of relative contributions made by the individuals

„П Criteria for evaluating the effectiveness of selection and placement decisions

„П Reward decisions, including merit increases, promotions and other rewards

„П Determining training and development needs

However, there are a few flaws in the traditional approach to performance appraisal. Some of these are:

„П It is primarily concerned with past 12 months history rather than looking forward to future goals

„П The appraisal is usually tied to the employees salary review

„П Demands a large amount of time from the supervisor, requiring a lot of time and observations of employees performance

„П Personal values and bias can replace organizational standards. For example, unfairly low ratings may be given to valued employees to prevent their promotions. Or in the extreme, cases of discrimination.

„П Ratings can vary depending on the person doing the rating. Some supervisors are more lenient than others, the experience of the person giving the ratings can result in skewed scores, and the fear of conflict when delivering negative ratings

Despite the negative impacts that can result from the traditional approach, if you have developed future performance plans, established goals and responsibilities, and actively communicated with the employee, the traditional performance appraisal can be a good tool.

The 3600 Peer Review

In Getting 360-Degree Feedback Right, the author explains the purpose of this review process ÐŽ§is to provide timely and useful feedback to help individuals improve their performance,ЎЁ also that ÐŽ§detailed, qualitative feedback from peers accompanied by coaching and supportive counseling from a manager is essentialЎЁ (p.78). In his article, Peiperl discusses four paradoxes which are fundamental to the peer review process: The Paradox of Roles, The Paradox of Group Performance, The Measurement Paradox, and The Paradox of Rewards.

In the Paradox of Roles, it states that colleagues are better able to judge a peers performance because bosses no longer have all the information they need. However, because it is people who work closely with the appraisee, the feedback may be conservative for fear of damaging relationships and may be distorted and overly positive, resulting in inaccurate rewards.

The Paradox of Group Performance was developed to gain insight into the workings of a team. However effective the group appraisal is, the appraisal stills tends to focus on the individual. This type of appraisal has the potential to create resentment among other team members, ultimately harming the relationship of the group.

The Measurement Paradox arises because ratings in the traditional performance appraisal fail to provide detailed, qualitative comments and insights which are helpful in improving performance. The drawback to this is that it is time consuming and can cause problems when the information is personal and characteristic.

The Paradox of Rewards was created because employees tend to focus on the outcome of the reward, which in many cases only improves performance for a short time period. Peiperl says the problem with rewards is that employees are focusing on reward based performance issues such as attendance and ignoring constructive feedback. He believes that feedback is what provides the best performance over the long run.

When the 360-degree peer review is done properly and the reward aspects removed, this type of appraisal system has the potential to provide criticisms not only from superiors, but also colleagues. These criticisms can be viewed as unbiased and be seen as positive criticism which has the ability to improve performance over the long run.

Debundling

It is estimated that 90 percent of U.S companies now have some form of appraisal program in place. The term performance appraisal can be called many things including performance review, performance evaluation, personnel rating, merit rating, employee appraisal or employee evaluation. No matter what the process is called, they all attempt to serve the same purpose. There are many arguments that say performance appraisals often leave employees unsatisfied, deflated and not sure exactly where they stand with their supervisor or for that matter, in their organization. So we ask of ourselves: Is there an alternative?

In Peter E Scholtes book, The Leaders Handbook: A guide to inspiring people and managing the daily workflow, he claims that companies management practices are based on false assumptions and cynical beliefs. Based on the reasons companies give for utilizing the traditional performance appraisal, he explains the assumptions