It’s time to revamp your performance appraisals…Now!


If you are like the majority of companies in Colorado you have seen annual pay raises become an organizational question mark at the end of every year.  In some cases, salaries have dropped.   This has created a detrimental paradox for the employee annual reviews constructed around a “pay for performance” methodology.  In those environments where individuals are taking salary cuts or have not received increases in the past two years, there is a huge and fundamental disconnect between saying “you did an outstanding job and as a reward we are cutting your salary by 5%.”  While the message may not be spoken in the same breath, the message is still clear, and no amount of sugar coating will make that pill easier to swallow.

So what I might introduce to you is the possibility of changing your feedback system and shifting your annual performance reviews (which by their nature are past-focused) into developmental planning sessions (forward-focused).  Because let’s face it, most of us do not get a real warm and fuzzy feeling when we look backwards.  And as a fundamental principle, how does looking in the rear-view mirror help you get to where you are going?

I am not naïve enough to claim what I propose is simple; quite the contrary it requires a number of systematic, cultural, and educational shifts.   AND I think this is the best time to do it as your current system has been rendered irrelevant by economic reality.   In some instances I can see how the idea of “no raises” is driving supervisors to give negatively skewed evaluations.  After all, it is much easier to justify someone not getting a raise if the performance is rated as sub par; serving to only further demoralize people who feel like they are working harder than ever.

So where do I start, you ask.  The first place is to look at the supervisors and managers.  What is their view of employees and abilities to provide clear expectations, effective feedback, and coach strengths?  If there is a skill gap there, fix that first.  If supervisors are not able to clearly define what is expected, provide feedback that reinforces positive behavior, correct undesired behavior, and help people develop their strengths, get them the skills to do so.  If your supervisors and managers do not feel this is a part of their job, then find a new manager as they are limiting the growth of you organization by not developing future leaders.

The second place to look is at the systems that reward and recognize the managers.  Note we have not even touched the review form, yet.   Build in criteria for their advancement to include their leadership development abilities and healthy/unhealthy attrition.  If you have a manager who is producing decent results but is burning through talent, then chances are he/she is costing you more in knowledge capital loss, recruiting costs, and transition time than pure production results will indicate.  And, they are directly creating the huge leadership void your company is faced with today.

Now, change the review form.  In fact get rid of it, start over.  Build from the group up based on organizational goals and individual strengths.  Have the employees come up with a list of 5 things they know they are good at; they can be task focused, skill focused, or competency based.  It is crucial the employee comes up with the list and is not judged by the manager, especially if you disagree.  Things people recognize as their strengths are often the items they have the greatest amount of passion for and you cannot coach someone to be passionate.  Now, pick one of those strengths that align with the organizational goals and develop a plan to make it even stronger.  What resources do they need?  What opportunities can be provided?  What new things can be delegated?

The most successful coaches do not try to take someone’s weaknesses and improve them.  I offer this analogy, if you were a football coach, would you take the person with the worst hands and try to make them into a receiver?   Wouldn’t it make more sense to take someone who has an innate ability and make them better?   The most successful people in business find out how to develop what they are good at an manage what they are weak in.  This is the essence of performance coaching, providing feedback to keep the weaknesses manageable and giving opportunities and resources to help people excel in what they already have passion for and are good at.

Employee development and performance management is as much of a mindset as it is a skill-set.  If you do not believe your employees are worthy of developing, then your probably should be looking for someone who is.  And that is not to say developing always means promotions or advancements, sometimes it is lateral, sometimes it is within their current role, and sometimes it is to a different company altogether.

That last one might be the hardest to accept.  Why would I develop someone to go somewhere else?  And the question I would pose back to you is , why would you develop someone at all?  The going somewhere else will happen whether you develop them or not.   Usually, those who do feel they are not getting developed in someway or fashion will go somewhere sooner than those who do.

Having a reputation as a manager or organization that develops leaders has a much easier time recruiting good talent than one that treats people like they need to be fixed.  Your employees are not broken, they just need help living up to their abilities, and that is as much up to you as it is to them.  Stop telling them how they did and start helping them do it better.

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