Common problems in performance appraisals
Performance appraisals play a crucial role in any organisation and present a host of benefits for employers and employees alike. However, there are numerous problems that can arise from these meetings, leading to more harm than good.
To prevent you from falling into the same traps as other organisations, we’ve laid down all the common issues that arise from poor performance appraisals, mistakes managers commonly make as well as ways to avoid this.
The common problems with performance appraisals
There are numerous issues that can arise from performance appraisals. However, the more aware we are of issues that could arise, the easier it is to identify and prevent them from having a negative impact on what should be a useful process for all.
The four most common problems with performance appraisals
Appraiser bias
Prejudices are an inherent trait of humans – research shows that we make more decisions based on our own biases instead of facts and logic. So when conducting a performance appraisal, it is possible for the appraiser to, consciously or unconsciously, formulate bias in favour or against an employee, thereby affecting the outcome of the performance appraisal.
Halo effect
This refers to the process whereby an appraiser takes a trait of an employee, such as a personality trait, physical trait, or previous work experience, and bases their judgement on this one aspect. For example, if an employee always exceeds performance expectations, an employer may generalise based on this, rather than conduct a thorough and objective performance review.
This is why it is important to conduct evaluations that are accurate and allow managers to analyse observable results that cannot be misconstrued through interpretation. This is where real-time performance appraisal software can help as it can continuously collect information to be used in performance evaluations.
Extended periods between appraisals
Another common issue seen with performance appraisals is the extended time period between reviews – organisations typically do this once a year. However, this means that employees do not receive continuous, instant feedback on their work. This can leave some employees feeling frustrated or confused as they are unable to determine whether they are improving in their performance.
We would instead recommend a six-monthly timescale for conducting performance reviews, and encouraging consistent feedback in weekly or fortnightly 121s with managers. This ensures your employees are never surprised by the results of their performance review.
Lack of recognition
Another significant issue with performance appraisals is the fact that many managers focus on the negative, not the positive. When providing feedback, it’s important to structure it in a constructive manner where employees are given appreciation as well as constructive criticism. This will positively impact their productivity and engagement levels.
Three mistakes to avoid when conducting a performance appraisal
While performance appraisals have the potential to enhance an employee’s work experience, they can often do the opposite, leaving them unsatisfied. This can generally be attributed to managers and the mistakes they make during the performance appraisal process.
Not following up
Many managers make the mistake of not following up with employees after performance appraisals. The task may have been completed, however, a performance appraisal should lead to the formulation of goals and action plans going forward. While employees should be responsible for developing themselves, managers have the responsibility of supporting their employees where possible so that they can achieve their goals.
Central tendency
This refers to when an appraiser gives employees an average rating across all performance scales. This is typically done when raters do not want to hurt employees’ feelings or they simply want to avoid over- or under-rating employees’ abilities.
This does not only result in an inaccurate reflection of an employee’s performance, but it also negatively impacts the data retrieved from these appraisals. This will limit management’s ability to make informed, proactive decisions.
Recency effect
This occurs when the person conducting the performance appraisal focuses on the most recent events or work of an employee instead of reviewing the entire performance period.
This means that, if a poor-performing employee suddenly performs well in the time leading up to the appraisal, they will have a good performance review, which would simply be an inaccurate reflection of their overall performance during the past year.
On the other hand, an employee who generally performs well may drop in their performance, and this may simply be due to factors outside of their control. This would then result in the employee receiving a poor performance review, which does not accurately reflect the work they’ve put in throughout the period being reviewed.
How to reduce errors during performance appraisals
While performance appraisals can bring up numerous issues, it is possible to reduce these errors. Firstly, it’s important that senior management learn the basics of performance management which will help them to conduct such reviews in a constructive manner.
We’ve seen how biases negatively impact appraisals. By educating staff about the potential forms of bias, you can help them to become aware of their own behaviour, identify when bias is clouding their judgement as well as ways they can mitigate the effects of biases.
Another way to reduce errors is to use all available resources during the appraisal process. Using documentation that supports an appraisal, such as an employee’s sales records, will ensure that a manager is reviewing the employee’s performance objectively, and reduces their reliance on memory. Additionally, the standards against which an employee’s performance is measured should be objective.
Once a manager has completed the draft version of a performance appraisal, they could send this, along with supporting documentation to be reviewed by a colleague to ensure that they have conducted an objective evaluation.
How Moorepay can support your appraisal process
At Moorepay, we offer Performance Management Software that will allow you to continuously collect data on employees. This information can then be used to make objective, informed decisions resulting in an appraisal process that is seamless and effective. Besides that, our automated reminders mean your HR team and managers never miss a deadline.
If you’d like to learn more, check it out here. Alternatively, you can book a demo and see how our software can help your organisation.
