Are Performance Reviews Worth It?

The performance review is getting mixed reviews from workers, according to new research from staffing firm OfficeTeam.
Although most (79%) HR managers interviewed said they schedule these meetings at least annually, one in four employees feel the assessments do not help improve their performance.
This contrasts with 89% of HR managers who believe their organization’s performance appraisal process is at least somewhat effective.
More than a quarter (27%) of companies hold reviews at least twice a year, a nine-point jump from a similar survey in 2010.
“It’s possible that the employees who responded with a negative view of the value of performance reviews were those who were rated poorly on their appraisals,” says CBIA HR Counsel Mark Soycher.
“In turn, managers often see evaluating employee performance as the dreaded annual process where they have to confront an employee about a problem—one that would have been more effectively addressed when it first appeared and approached as a ‘coachable moment,’ with the opportunity for immediate improvement or some immediate corrective steps to turn the situation in a positive direction.
“Whether it’s praise or criticism, the performance review should be an update of ongoing conversations about previously defined goals and objectives, not surprise news.”
HR managers were asked, “How often, if ever, do you conduct formal performance appraisals of your staff?” Their responses:

• Quarterly—12%
• Twice a year—15%
• Once a year—52%
• As necessary—16%
• Never—5%

Workers were asked, “How effective do you think your company’s performance appraisal process is in improving your performance?” Their responses:

• Very effective—37%
• Somewhat effective—38%
• Not very effective—14%
• Not effective at all—11%

HR managers were also asked, “In your opinion, how effective is your company’s performance appraisal process in improving employee performance?” Their responses:

• Very effective—43%
• Somewhat effective—46%
• Not very effective—9%
• Not effective at all—2%

Tips for Managers
OfficeTeam offers five tips for managers when conducting performance appraisals:
1. Get a head start. Check in with your HR representative regarding forms and guidelines for the meeting. Take time to reflect on employee achievements and whether expectations were met.
2. Have others weigh in. Seek feedback from colleagues who regularly work with the staff member to receive the full picture. You may uncover new insights.
3. Encourage active participation. Let workers know what to expect from the performance appraisal and how they can prepare in advance. Ask employees to compile a list of accomplishments, obstacles, and goals for the discussion. Remember, it’s a two-way conversation.
4. Choose your words carefully. When critiquing worker performance, give specific, constructive feedback, as well as suggestions for improvement. Also acknowledge the employee’s recent successes.
5. Focus on the future. Reach an agreement on objectives for the coming period and regular checkpoints for assessing progress. Discuss any resources or support the worker needs.
“Managers should think about the purpose of the performance review and ensure that the way they approach it meets that purpose,” says Soycher.
“They should think about what they’re measuring and why they’re measuring it and focus on employee goals that align with or advance business objectives.
“The active participation component of a performance evaluation should involve discussing what’s important for the employee’s job for the coming year and include input from the employee and supervisors, as well as what the metrics will be.
“And it’s important to be flexible over the course of the review period based on changing circumstances or new opportunities.”