Annual performance appraisals are rife with many glitches that make employees feel startled like a deer who is suddenly faced with headlights of a speeding car heading straight for it!
Sure, it’s great to receive feedback at work and take corrective measures based on the same. Still, it’s a different ball-game altogether to go through the yearly ordeal of sitting one-on-one with the manager and indulging in a box-ticking exercise with no meaningful outcome whatsoever.
Factors that Hinder Annual Performance Appraisals? Why does HR need to Re-Imagine them?
Companies across the world spend millions on yearly reviews to assess employee performance, only to shift goalposts later and digging a big hole in their bottom lines, in the bargain.
What’s more eye-opening is that employees feel it’s a toxic exercise in itself and tends to hate them.
According to various studies, only 14% of employees strongly agree that performance reviews they receive inspire them to improve.
In fact, many notable organisations such as Accenture, Netflix, Microsoft, General Electric, etc. have adapted their system of yearly appraisals in tune with what’s really going to impact employee productivity in a positive manner.
Netflix uses peer-to-peer recognition as an approach where people undertake performance conversations as usual activity. Whereas, Accenture has introduced a flexible approach that encourages managers to provide on-going feedback in real-time during projects and assignments.
Lack of such an approach contributes to making employees feel that appraisals aren’t working.
Here are all the factors that make employees feel that appraisals are pointless…
There exists a flaw in the name itself; appraisals should not be a formal yearly exercise but an ongoing process. For employees, it is as good as playing a dartboard game blindfolded throughout the year, only to receive feedback or reveal scores a year later. In fact, even the quality of feedback gets compromised or faded, with employees losing out on opportunities to learn from their mistakes or capitalise on successes.
The managers tend to dig in between cracks and offer feedback simply based on what they can remember happening in the last twelve months, rather than provide genuine feedback that really matters. Today, employees want to experience and solve problems real-time, especially the millennials, and they expect the managers to do the same when it comes to offering their valuable feedback.
Being recognised for a project they handled well 6 months ago does not quite work since they want to know how they are performing right now!
According to statistics, 64% of people would switch employers if they are recognised for their work on the new job vis-à-vis an employer who does not recognize them! Therefore, annual reviews need to transform from single yearly conversations into regular feedback that meets the needs of employees and organisations.
There is a huge resemblance between new-year resolutions and goals set during annual performance appraisals for the next year i.e. they do not live long or materialise! The sole problem with both is their nature, which takes place once a year, and tend to get forgotten or become meaningless somewhere down the line.
Goal setting has to adhere to the five basic traits of being S.M.A.R.T: Specific, Measurable, Attainable, Realistic and Time-specific.
By time-specific, we mean short-term goals which are attainable and can be adapted to stay relevant. Business needs to keep evolving, which means goals should evolve with the need of the hour too. Employees need meaningful, clear and up-to-date objectives to perform their work efficiently, which is not possible by setting goals for them once a year!
A year is a lot of time for things to change, so HR should stay flexible on goal setting in tune with the changing business demands rather than being stuck with the market scenario that existed months ago.
Lack of Purpose:
One of the reasons employees find performance appraisals pointless is that they don’t really understand the purpose behind having them.
They feel that the HR team often ends up focusing on the administrative procedure more than actually communicating the aim of conducting the performance reviews in the first place. This leads to confusion or mismanagement, with employees wondering about the benefits of these reviews both to them and the company.
The whole process ends up being blurry, expensive and time-consuming. If at all, many HR executives will state different reasons for conducting performance reviews which may be miles apart from the actual intention of organizing them. For example, letting employees know how they are doing, or justifying pay increases or having solid grounds to terminate underperforming employees.
For all of these, having annual performance appraisals is not really important, as it can be accomplished whenever required without really making it an annual task.
They are Insulting:
Let’s face it, giving genuine feedback about one’s work can be difficult. 67% of leaders feel uncomfortable communicating openly with staff. But from an employee’s perspective, it’s not only difficult but sometimes can get downright insulting.
For example, being told about an area of improvement is good, in fact, its healthy for improving on-the-job performance. But being told how to do one’s job right can seem very demeaning and unprofessional. When performance reviews end up being forums for personal vendetta or where the manager’s unconscious bias attempts to degrade an employee’s working style, the whole essence is lost making it a pointless exercise.
Performance appraisals somewhat reinforce the boss-employee relationship, putting the boss on a higher pedestal, which is hardly the norm in today’s knowledge economy.
Today, supervisors, managers and the HR department are expected to work just like a conductor who keeps the orchestra together, without any biases or assumptions to tell the musicians how to play their instruments!
Too Structured and Too Formal:
Too many questionnaires to fill out, too many ratings to give too many boxes to tick! The annual performance appraisals lack a more informal, human approach to something that deals exclusively with humans working in your company and their performance.
Structured and formal processes do not lead to meaningful conversations of any real consequence. It’s as good as filling in the blanks while leaving out the most crucial parts- honest and constructive feedback about one’s work and how they plan to take it forward.
For employees, there can be many aspects of their everyday work achievements which can certainly never fit in the little checkboxes.
For instance, if an employee works remotely because of a certain reason, he/she needs to be given feedback in terms of their tasks achieved and not in terms of punctuality.
Failing to give them objective feedback on such achievements throughout the year leads to yet another performance appraisal going futile.
Who has the time to sit and evaluate a year’s work, both positive and negative, employee-wise? Most managers just focus on doing it fast and getting it over with, making it a mere obligation. Employees understand this very well, as the same lethargy and unexplained results are reflected in their own performance reviews, thereby helping them to conclude that managers don’t really want their subordinates to progress.
Annual performance reviews have attracted enough negativity and should be altered immediately in order to truly reap the benefits that they intend to generate, both for the employees and the business needs.