In previous posts, we have discussed how employees are selected and trained. We can now examine how to measure and manage performance through a performance management system, as well as some of the pitfalls you can encounter during the process.

What does a performance appraisal entail?

Simply put, a performance appraisal is measuring an employee’s performance on the job against the established standards of the job or pre-set goals. A standard refers to ongoing performance criteria that must be met time and time again (e.g., complete all invoices daily). A goal describes a particular objective that has been jointly established and agreed ahead of time (e.g., increase sales by 10% before an established date).


Generally, a performance appraisal form or online tool is used to record important facts from the discussion, and to keep as a confirmation of commitments or goals agreed upon. Some performance appraisals outline the criteria on which each employee is appraised, and may even include a numerical rating system on which to rate each employee. Performance appraisals can be extremely simple or quite complex - You need to choose one that works for you and your organization. 

Many organizations conduct a new employee’s first performance appraisal just prior to the expiration of their probation period, and then annually thereafter.

While there are many pitfalls you can encounter when appraising an employee’s performance - Here are some crucial ones to be aware of:

Monologue

Performance appraisals are meant to be a dialogue of two-way communication between the manager and the employee. This allows both parties the opportunity to offer feedback, ask questions, and state their opinions.

A Secret Report

In order for an employee to progress, they need clear feedback about their performance, areas for improvement and a plan of action for development. Indeed, the annual performance review should be a composite of all the feedback given and
received throughout the entire year. Performance appraisals are not a substitute for daily management. If you have been managing daily, the employee should have an excellent understanding of where they’ve succeeded or need to improve.

A Discipline Interview

Performance issues cannot wait and need to be addressed directly and immediately. The performance appraisal may include an update on progress through performance issues, but it's not the venue for imposing discipline. Performance appraisals should support regular feedback, coaching, and counselling, and not be a substitute for disciplinary discussions.

An Attack

Performance appraisals are not a popularity poll. The intent is to appraise performance objectively and professionally; and without threatening an employee’s self-esteem. 

Now that we know what not to do, let’s look at some simple guidelines for conducting an effective performance appraisal:

• Formally review performance at least once a year, preferably twice.
• Give the employee prior notice of the appraisal session and information in terms of what they can expect.
• Reassure each employee that the purpose of the performance appraisal session is to improve performance and foster better communication, not to discipline.
• Conduct the performance appraisal session in private without interruptions
• Recognize positive aspects of the employee’s performance.
• Make criticisms specific - Don’t be vague.
• Focus criticism on performance, not personality characteristics.
• Emphasize your willingness to help the employee improve their performance.
• Identify specific actions the employee can take to improve performance.
• End the session by reiterating positive aspects of the employee’s performance.
• Remember to complete written documentation of the appraisal. This record should become a permanent part of your employee’s file.

Performance appraisals are an excellent means to open a productive dialogue with an employee and establish meaningful goals and an action plan for ongoing performance development. As always, communication is the key!

Susan Alley, VP of HR Services

Alley is a senior executive with significant consulting experience in human resources in both unionized and non-unionized environments. Alley has provided strategic and practical solutions to internal and external client corporations in a variety of industry sectors including financial services, hospitality, real estate, retail, healthcare, manufacturing, government, professional services and high tech. Her strong leadership, communication and problem solving skills, coupled with a broad range of experience, provide a strategic and disciplined approach to customer service, business, and human resources management.