Tuesday Tip: [Why Annual Performance Reviews are a Bad Idea]
Why Annual Performance Reviews are a Bad Idea
Most organizations have a formal employee performance review process that use standard HR-approved appraisal forms and grading systems. Quite often the outcomes of the reviews are tied directly to each employee’s annual compensation in the form of a raise, bonus or other such reward.
Although these reviews are intended to provide constructive feedback and help employees understand how they can improve their skills and advance their careers, they unfortunately are poorly designed, poorly administered and are of little help to anyone giving or receiving them.
Three Reasons to Abolish Annual Reviews
- Standards are Vague, Subjective and Open to Interpretation. Because performance reviews are based on predefined, generalized standards, they hold little meaning for someone truly interested in hearing about how they are performing and how they can make improvements to their work. These one-size-fits all appraisal templates usually leave the employee with more questions than answers. If, as a manager, you are using a 5-point scale to judge your team members’ performance, do you grade on a curve? Does anyone on your team get all 5’s? If you have an employee scoring all 1’s and 2’s, does that reflect on your performance as their manager? Should you even consider firing someone with scores that low?
- Too little, too late. Spending 15 minutes, once a year discussing an employee’s performance is far too insufficient to be useful in any way. When you combine this infrequency with poor timing by conducting your reviews at year-end, you’re accomplishing a whole new level of insignificance. Adding a review to the piles of other annual activities taking place, just confirms for employees how little you care about their careers and development.
- So, now what? Conducting performance appraisals as a stand-alone, snapshot-in-time event does nothing for organizations looking to create a culture of continuous improvement. Without directly tying reviews to employee training and development initiatives, you can’t expect outcomes to be any different the following year when you dust off the evaluation forms and go through the motions again.
Unless your organization intends to use performance reviews to accurately appraise performance and use that information to develop training programs and create an overall culture of continuous improvement, then your organization should consider abolishing the annual review process altogether. Appraising one’s performance should be done frequently, informally and objectively.
The following form is for requesting specific information and is NOT the registration form for the upcoming webinar. You must go to the webinar registration page to be signed up and receive webinar participation instructions.