How to Prepare for Your First Performance Appraisal
As an Employer
As an employer, the most important decision you'll make regarding performance appraisals is what type you intend to do. If you are the CEO or business owner, you'll probably have primary decision-making power when it comes to this issue. However, if you are a middle manager or have limited executive functions, your opinion may not be the only one that matters. If you are the only person making this decision, stop being the only person who makes the decision. You may have final say over the decision, but you probably shouldn't be the only one determining your appraisal method, as multiple perspectives can prove highly valuable, especially if you are a medium or large business or organization and don't interact with the majority of your staff every day. When making the decision, you'll want to consider a number of factors, including the size of your organization, the formality of your business and current staff, your current organizational structure, and so on. Be sure to consider both current and future staff when making decisions, just as you would consider the size of your business now, as well as where you would like the size of your business to be in five years.
Once you have determined what type of appraisal you intend to have, you'll need to make decisions regarding what raters you will and will not include for various positions, how long you intend the appraisal to take, how frequently you intend to have appraisals done, and more decisions based specifically on each type of appraisal. One of the more critical decisions you'll need to make is whether or not you intend for subordinates to participate in the evaluations of their supervisors. Although this may seem to be something that would be more geared toward smaller businesses and organizations, it is often larger businesses that receive the most benefit from this type of input, especially if your human resources department is more administrative in nature and less involved in the day-to-day issues that may plague lower level employees.
As you continue making decisions regarding performance appraisals, you'll need to consider what the potential ramifications of those appraisals may be. How will you handle an employee who receives a more negative review? Will these appraisals determine raises or promotions? If you're performing a 360-degree review and including clients in your assessment, how will you motivate them to participate, how much credence will you give to their answers (especially if it is significantly different from the internal assessment), and how will you placate those clients who take giving you their opinion as an implication that you will do whatever they want?
If you have not previously completed formal or intense performance appraisals, but intend to start, you may want to consider hiring a consultant to help you establish your procedure. Not only can a consultant help you make decisions regarding what type of appraisal to have, he or she can also help you determine how to get the most accurate appraisals, while ensuring that you are complying with any and all applicable laws.
When it comes time to actually begin the process, make sure that all raters have received proper training to ensure accurate and legitimate responses. Provide your staff with information ahead of time about what to expect from their review. If you intend for your staff to perform any type of self-review, peer review, or review of their supervisors, make sure they have plenty of time to complete it (during work hours). Give serious thought as to whether any evaluations they give should be confidential (or, at the minimum, ensure there cannot be any retribution for their honesty during the process).
Lastly, part of preparing for performance appraisals is planning what you will do when the appraisal is over. Getting an accurate performance appraisal can be very purposeful and beneficial to companies in order to understand the strengths and weaknesses of their staff, as well as to assess how well each staff member is doing at his or her job. But getting an accurate review is only half the battle; developing goals and a plan for each employee to achieve is vital. Some of this is going to be on an individual basis, whether it is objective (increasing the number of items distributed in a day), subjective (improving the quality of casework being completed), or personal (such as improving one's attitude to increase morale). Most of the goals made during, and as a result of, the evaluation will be made on an individual basis, just as the appraisal should be made on an individual basis. However, depending on the position of the person in question, their goals may involve other staff members, such as a supervisor providing team-building exercises.
It is also helpful for a manager or owner to plan in advance how best to deal with the aftermath of the entire performance appraisal process, especially if the process is being started or changed. There may be a backlash from employees, distrust within or between departments, and so on; the best manager will be sensitive to these issues and proactive in preventing or relieving them as appropriate.
Preparing for Performance Appraisals as an Employee
As an employee receiving a performance appraisal (even if you're also giving them as a middle manager), you have far less decision-making influence, which allows you to focus. While there are few things you can, and should, do differently based on the type of appraisal you will have, most of the work you need to complete will be the same, no matter who is evaluating you.
Before you determine strategies you wish to employ, and ideas about influencing your potential raters, you must begin with a self-evaluation. Whether your employer asks you to evaluate yourself as part of your performance review or not, it is still a good idea to perform a self-evaluation anyway. It will give you the opportunity to consider your achievements, challenges, and mistakes of the past year (or however long it has been since your last performance review). It will also give you the opportunity to genuinely identify areas of weakness, and to set your own goals to overcome those areas. If there are any significant issues that have taken place since your last appraisal that you believe have mitigating factors -- extended leave of absence due to illness of a child, personality conflict with someone no longer employed by the company -- make a list and create a couple of quick bullet points for each item on the latest. That way, if those issues are brought up during your evaluation (assuming you don't have to do a self-evaluation), you are prepared to address them briefly with your supervisor. You will feel less anxious, because you know what to expect and what you want to say, and your supervisor will be more inclined to listen if you acknowledge the problem, show that you've put thought into addressing it, and communicated it to them succinctly.
Developing your own goals for the upcoming year is also a good idea, even if your goals are typically determined by your supervisor. First, it simply allows you to be proactive and take charge of your own career path. It also gives you the freedom to set personal goals that will help you in future endeavors, whether or not they are necessarily the number one priority of your current supervisor. Third, it demonstrates to your boss that you are committed to being the best employee you can be; and lastly, you never know when one of your bosses may ask you what you think you need to work on, even if you were told there would be no self-evaluation.
While doing your self-evaluation, be sure to make a list of particular achievements you have had over the past year. Your supervisor may recall problems more easily than achievements; if you have a list prepared, you can use that list during your appraisal to remind your supervisor of ways you have shown improvement, goals you have met, and successes you have had. Even if you are having a traditional judgmental evaluation, you will usually have some part where you can respond to your supervisor's appraisal, so be sure to make your own case.
Alternatives to Performance Appraisals
For those managers that are unsure if standard performance appraisals are the right way to go for their company, there are alternatives gaining ground among business leaders and organizational psychologists. Some of these methods are extraordinarily different from each other but do, in different ways, help combat many of the concerns and limitations performance appraisals have.
Many of the conflicts that exist with performance appraisals of almost any kind is the overabundance of subjective measures. While objective-only reviews may not be appropriate for everyone, when they are appropriate, they can be extremely helpful in providing a clear and honest review. Such a review will be geared specifically toward employees meeting goals that are designed to strengthen the company, but without evaluating the methods used to achieve those goals. Put in the simplest way possible, this type of measurement does not involve any subjective critique and instead relies solely on the setting and achieving of various goals that, theoretically, should identify whether the employee is doing their job successfully.
Obviously, the benefits of this type of review are simple but important - objectives are clearly expressed, goals are set, and there isn't a tremendous amount of room for debate. Of course, there are some questions as to whether it can be ethical business practice to focus solely on the ends, with no consideration of the means. In some professions, it may be entirely ethical if the likelihood of an employee using illegal or unethical means is minimal; in other professions, the risk of unethical behavior may be high. Also, consequences of not meeting goals should be defined and expressed clearly ahead of time, and should be consistent for all employees.
One way that some companies have found success with eliminating performance appraisals has been by emphasizing organizational commitment as a primary method of motivating employees to do a good job. Theoretically, employees who are emotionally invested in the company they work for will want to help the company achieve its goals. Because business goals typically include making money, achieving that goal means every employee working to fulfill their maximum potential. If an employee is committed to the company or organization they work for, they will be significantly more likely to work hard at their job in order to achieve success for the whole business, not just themselves.
Organizational commitment is more or less likely to be successful based largely on the type of work being done, the organizational culture already developed, and the dominant social culture of the geographic area where most employees live. Geographic area helps predict the types of individuals who may be working for the company and whether or not their society promotes independence or community more strongly. When it comes to organizational culture, it is similar to this type of cultural influence only it has been established within the organization, sometimes independently of the cultural influence of local society. That is to say, a company or organization that has hired individuals who have a strong value of community over individual success, even if the outside culture values individual success primarily, developing organizational commitment may be more likely to occur.
Of course, the type of work being done can also have a large role to play when it comes to developing organizational commitment. Many professions lend themselves to employees who are community oriented. Teachers, nurses, social workers, and other helping professions tend to attract individuals who put a higher value on community than individualism. In this way, the organizational culture may already be set based only on the personal values of the individuals employed. In this way, organizational culture promoting organizational commitment is a natural byproduct of the types of people working in these professions.
Quality of Work-Life
Another alternative to performance appraisals includes generating productive employees by creating a positive work environment. Quality of work-life has been shown time and again to be a motivational tool for attracting employees to your business; however, it is debatable whether quality of work-life influences behavior or instills a greater commitment to hard work and productivity. Some famous examples of places that have built employee strength by providing an excellent quality of work-life include Apple, Facebook, and other high-end companies that offer everything from in-house child care, to video game arcades. Again, the theory prevails that if employees are happy, they will likewise be productive. Factually, this is still a controversial argument.
It is easy to see why having a positive, high-quality work-life environment would attract highly skilled and knowledgeable workers. Excellent benefits, ongoing education, a work environment that promotes fun, and related ideas are obviously attractive to men and women who have tremendous skill to offer. But once they have the job, whether feel as strongly compelled to keep it is unknown. Essentially, it is significantly harder to get a job than to keep one; thus, those individuals who are more likely to slack off, believing that their skill or intelligence is more valuable to the company than hard work, may be unlikely to respond as strongly to quality of work-life motivation without any sort of formal performance review.
Other Motivational Tools
Of course, there are other motivational tools that a company could use to generate hard work from its employees. Obviously, increased pay is one of them. If the company pays significantly more than other companies in the same area for the same job, that can be an excellent way to motivate employees to rise to the occasion to keep making the big bucks. While this could fall prey to the same traps of offering a higher quality of work-life, this is contingent upon the company providing higher pay for the same work; most companies that offer ideal work-life conditions are competing with other companies that offer similar, or the same, benefits. They also tend to be companies with employees who are particularly skilled in a niche profession, many of whom are going to make a substantial amount of money anywhere they go. Thus, they are not always as motivated to retain their existing position. If, however, you're talking about paying a cable installation technician 125 percent of what they would make working for your competitor, they are more likely to perform well, because if they don't, and they lose their job, not only do they have to try to find another job, they are not likely to find one that is competitive with their current salary or benefits.
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