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Performance Appraisals - More Oops!


Several weeks ago my son called me to have a father son discussion about his job. He’s an engineer at a naval technology company that primarily does work for the government. After several good years with the company he’s a bit disappointed in his compensation package, especially after he received a very good performance appraisal.   Most recently he is directly responsible for bringing some new business to his company. The group he’s been working with decided to switch a job they were doing with a competing company to his company largely due to the work he had been doing supervising the current project. 

Despite these efforts and the excellent performance appraisal, his supervisor informed him that he would be getting a very minimal raise this year. My son mentioned a practice at his company that resonated with the description of performance appraisals in Aubrey Daniels book Oops. Many companies have a quota on who gets raises dependent upon receiving a good performance appraisal. My son mentioned that he was aware of such a practice in their company. If a supervisor turned in a score below or above the norm he was required to turn in a good deal of paperwork to support it. The practice prevented supervisors from giving poor and even good performance appraisals because it was both a head ache to have to complete more paperwork and once submitted they were held under scrutiny for the submission.
Performance Appraisals in Aubrey Daniels book Oops is #3 of the Management Practices that waste time and money. He cites a 1994 study [Society of Human Resources] that found 90 percent of appraisal systems as not being successful. He notes that performance appraisals punish the rater and the ratee. Eighty percent of employees think they perform in the top 20 per cent of the employee population. That means that most employees get a rating lower than they think is accurate = a punishing experience. Because punishment if you recall decreases behavior, the result of the performance appraisal sessions for most people is to decrease motivation. 
It’s odd that company’s spend time and money recruiting the best people, and then once they are in the company proceed to tell employees that they don’t measure up to the company standards for reward. In other words even if you were better than most, had done your job superbly well, if there were others in your company who were more talented and had done even better you don’t earn a raise or bonus. Why not give the rewards to everyone if they do well? But that’s the problem with Performance Appraisals, at least as they are done now in most companies. There’s a statistical balance that needs to be in place. There can only be so many A players, and the rest are B, C or worse. Those are not deserving of a reward. 

Daniels provides five reasons for why companies continue to do performance appraisals which you can discover by reading his book. His basic premise is, “What are you trying to accomplish?”   Daniels quote I love is, “The best job you will ever have is one in which you know how well you have done at the end of every working day.” The best feedback cycle is immediate. Imagine a system that would tell your workers immediately at the end of each day how well they did.   Every job can be measured and performers will help you measure them when they learn that measurement is used to help them perform better and not used as the basis for criticism and punishment.

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