Face to Face (August 01, 2000)

Engineers, as schooled as they are in planning, analysis and other skills transferable to the art of people management, are generally no more comfortable with reviewing the performance of employees than anyone else. Many of them find the whole employee evaluation process, well, messy. It involves emotions, perceptions and, often, a great deal of ambiguity.

“There’s an inherent tension in the whole [employee review] exercise,” observes David Anderson, a senior consultant with human resource management consulting firm Towers Perrin in Toronto.

“It’s a complex human interaction with two people talking about one of them … his or her performance, character and behaviour,” he continues. “There are perceptions of criticism that go directly to that person’s feeling of self-worth. And employees perceive there is so much riding on their review … pay increases, promotions, job security and the like. So it can be an emotional minefield if not managed properly. And many, many of them are not done well at all.”

Which is unfortunate, to say the least, when one considers that these reviews are meant to focus and support employees’ efforts to improve their performance — their skills, on-the-job behaviour and ability to contribute to the organization.

Over the past decade, performance management has become an essential skill in the competence repertoire of anyone supervising — or aspiring to supervise — the work of others. The ability to assess and communicate an employee’s strengths and weaknesses is a critical component of performance management. And increasingly, if employees have trouble improving their performance, the failure is laid squarely at the manager’s office door.

Frame of reference

According to human resource consultants like Anderson, a big problem with many performance reviews is that they are conducted in a vacuum, “without a frame of reference.”

“You need to back up to the business strategy and analyze what, as an organization, you need to deliver. Then, you have to ensure the employee understands what he or she, as an individual, needs to deliver as part of that. In other words, `What do I need to do to align my skills and behaviours to my organization’s business strategy?’ And finally, a manager has to ensure the employee has the tools and resources to make that alignment.”

This approach does much to reduce the perception of arbitrariness that surrounds performance reviews in many companies, Anderson insists. Employees understand it’s no longer about what — or who — their manager likes or dislikes; it’s about what the organization needs.

For this reason, Anderson doesn’t think much of “the blank piece of paper” approach to performance reviews, where the manager merely takes notes while talking to the employee and then sends them a neatly typed-up copy of what improvements they’ve agreed the employee needs to make. He advises using a review “template” that provides a focus for the discussion, brings some consistency to the exercise from employee to employee, and ensures that all important points are addressed.

For example, managers often believe employees already know why certain behaviours or performance standards (e.g. like returning phone calls or e-mail messages within 24 hours) are important. But some workers may fail to make this link back to the organization’s strategy of, say, excelling at client service. Using a template ensures that everyone is singing from the same songbook, as the saying goes.

Oh so average

Another big weakness in performance reviews is the tendency of so many managers to avoid grappling with tough issues around unsatisfactory performance and to rate most of their employees as average or above-average. Problems remain unaddressed and the organization suffers as a result. Worse, employers are leaving themselves open to wrongful dismissal suits from any employee fired for sub-standard performance after receiving consistently “satisfactory” reviews.

The problem of inflated reviews is so pervasive that Towers Perrin will seldom rely on a company’s own performance management data when conducting an organizational review. “Most of the data is pretty useless,” Anderson says.

Often, the root cause of inflated reviews is the manager’s belief that performance evaluations have little real value.

“They’re viewed as an HR-ordered exercise with little bearing on the manager’s own business challenges and priorities. So why put too much effort into them? What these managers fail to realize is the tremendous impact reviews can have. So they fail to take advantage of a real opportunity to effect a great deal of positive change to help them address those business challenges.”

The best solution, Anderson adds, is for the CEO or managing partner to communicate the importance of performance management — including well-conducted employee reviews — to the organization. They should also evaluate managers themselves on how well they perform in this regard.

Another common reason for inflated reviews is that many people are uncomfortable delivering criticism. Managers need to know how to do this right, Anderson says, but they can’t shy away from it.

“The purpose of feedback is to help us gain insight, in this case, about how they’re doing. And that’s extremely important to most employees. Wishy-washy comments just aren’t helpful to anyone. Poor performance needs to be addressed humanely but decisively.”

Talking pay cheques

There has been a long-standing debate in human resource circles about whether pay increases should be part of the performance review discussion or whether they should be dealt with separately. Anderson believes that if performance feedback is to be considered important by the employee, the link should be made.

But many managers aren’t clear enough about what the increase is for, whether it’s an increase to base pay (perhaps to reflect increased responsibilities or new skills gained), or whether it’s a merit or incentive bonus for exceptional performance. “You need to be clear on what you’re rewarding and what the employee has to do to keep those rewards coming,” Anderson says. CCE

Shelley Boyes is a freelance writer based in Toronto.