Picture this, it is the final quarter of the year and a manager's mind turns towards annual ritual that is the year end appraisal. Now I don't know about you but many employees and their managers dread this event. Research I undertook in 2012/3 found that of the 30+ companies I spoke to, respondents indicated that they felt that the appraisal systems utilized in their company was disproportionately expensive to administer, overly complex and a bureaucratic box ticking exercise that often failed to deliver value.
Although it was never intended this way, too many employees found that performance feedback from their manager wasn't always forthcoming during the year and it wasn't unusual for performance issues to be raised at the year end and the conversation would deteriorate into an 'argument' over a numeric performance rating, rather than a constructive discussion on past and future performance. Interestingly this was more prevalent in larger companies, with complex performance management systems, in comparison with smaller companies with a less formal. As one respondent said, "We don't really have a performance management system, I simply review individual and team objectives with my team each week and we work on areas which need extra support or assistance."
But since then have organizations taken the opportunity to rethink the way organizations assess and manage performance?
The Chartered Institute of Personnel & Development (CIPD) highlighted that midway last year services firm Accenture decided to scrap the annual appraisal for it's employees, joining companies such as Microsoft and Gap in moving towards a more informal methodology for feeding back on performance achievement. In addition companies such as Google, Facebook and Netflix have scrapped appraisals entirely.
However, those companies doing away with formal appraisals aren’t abandoning performance management entirely. A culture of more regular, informal feedback was often the approach being used. By managers pointing out problems as they arise, employees have the opportunity to address issues proactively to make an immediate difference to the business. In our workshop Managing the Unmanageable www.managingtheunmanageable.ca we focus on developing and supporting managers to do just this in a supportive way.
However simply getting rid of appraisal reviews won't solve the problem, as CIPD, CEO, Peter Cheese says: “If you’ve got managers who think their job is telling people what to do, and beating staff up all the time, then just stripping out the formal procedures won’t work. You’ve got to build the organization’s dynamics to create a more trusting environment.”
What's your experience of annual appraisals?