Ask any manager what he hates most about his or her job and you’ll likely hear “performance reviews”. For many reasons, these periodic employee evaluations have been done poorly if at all in the past. What follows is a list of the 10 most important reasons why performance reviews fail.
1. Lack of manager training. Managers have never been trained how to evaluate an employees’ performance. Effective employee evaluation requires more than accurately filling out a form once a year; performance appraisals that generate performance improvement require good observing, listening, and feedback skills.
2. Peter Principle. Managers who never wanted to be in the job of supervising and managing other employees are promoted up the ladder. Promotion was just the only way for the employee to stay with the company or get more money. In one recent situation, an employee was encouraged by her manager to accept the promotion. The employee really didn’t want the added responsibilities but her manager insisted “she’d be good at it” and shouldn’t waste this opportunity. The manager offered to coach and mentor the employee and even to pay for training. Unfortunately her manager resigned just a few months later, only a few top performing employees left due to lack of attention.
3. Managerial mobility. Managers are replaced, relocated, or retire and their replacements don’t have the luxury of time to observe their new reports for more than a few weeks, even days, before they are asked to review the employee. This situation is particularly harmful when their predecessor’s criteria for evaluation is more critical or flattering. Worse, the previous manager didn’t document anything or wrote inappropriate remarks.
4. Social Workers. Employees are promoted to be a supervisor or manager because they really like helping people or are well liked. But when it comes to holding their employees accountable, they find it excruciatingly painful. This is particularly difficult when the manager now is responsible for managing his former peers. These types of manages prefer to remain your friend, not your boss, and do whatever it takes to avoid confrontation.
5. Horn Effect. This is the manager who believes “nobody’s perfect and there is always room for improvement.” The manager doesn’t believe in rewarding an employee with a “10” (out of 10) even when he/she deserves it. A few employers actually use a rating scale of 1 to 9 because no employee deserves a 10 in their minds.
6. Halo Effect. A few managers hope to boost an employee’s morale and confidence by rating his performance better than he deserves. Other managers just don’t want to be bothered writing comments justifying poor performance. Managers select ratings that don’t require any feedback or don’t want to put anything in writing that might be held against them should the employee ever file a complaint. And others don’t provide the rating an under-performer deserves because if the employee quits, this will make more work for the manager (that is, more interviewing and training….and who knows if the next employee might even be worse!). Whatever the reason for the halo effect, managers choose the easy way out and exchange positive reviews for mediocrity.
7. Money and Reviews don’t mix. Performance reviews should be focused on the performance that led to accomplishments or missed expectations. When salary increases are tied to performance reviews, some managers may be pressured to give good evaluations even when not deserved. Others use annual reviews to justify smaller than expected salary increases. The manager might even downgrade an employee’s performance to ensure the employee doesn’t ask for a salary increase. Likewise, with a high rating, the employee might feel justified in requesting more salary or benefits.
8. The manager and employee focus on personality and hard-work, not measurable results. The tendency is for the manager to reward the employee who is easier to manage even if he/she misses performance expectations and/or can’t do the job. A few employees expect high “grades” because they work harder and volunteer often even though the quality of their work falls short.
9. Performance reviews are required to be completed annually but this policy is not enforced. Some employees are reviewed and others are not. The employees who are reviewed might feel singled out and the non-reviewed employees feel ignored. When not provided regularly, employee performance appraisals can be based on most recent performance, not performance over the course of the year. Results go both ways. Employees who put on their best behavior around review time get favorable ratings and the employee who has a bad couple of weeks gets punished.
10. “When you’ve got a minute, stop by my office.” Performance reviews are “sprung” on the employee or done non-chalantly around the water cooler. Performance reviews are only scheduled when an employee is not performing up to expectations, another employee or customer files a complaint, or the company needs to terminate/lay-off the employee.
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