“How am I doing?” Everybody wants to know how he or she is doing on the job—and every team wants to know if it is performing up to the expectations of the team manager—and in turn, of the organization. That’s the main reason for performance appraisals.
Some of the other values of a good performance appraisal program are
There are a variety of systems to measure performance of individuals and of teams. In this chapter we’ll look at some of these and how to make appraisals work in improving the team’s performance.
Conducting formal reviews of the performance of individuals on the job has long been part of corporate procedures. The annual review—often dreaded by both the supervisor and the employee—was looked upon chiefly as the determination of how much (if any) salary increase a person would receive.
FYI
Formal structured performance appraisals were introduced in the late nineteenth or early twentieth century when the U.S. government instituted the civil service system. Before that all hiring, firing, and promotions for government jobs were made on the basis of favoritism, nepotism, or political party affiliation. Under the civil service system, performance appraisal (then called merit reviews) was designed to make these job decisions more equitable.
However, the real reason for such reviews is to look at the performance of the employee and determine how that performance can be improved. Salary adjustment was only part of the program—but it became the part that dominated the thinking of both parties.
Today, companies are moving away from focusing on salary adjustment—often covering it in a separate procedure—and concentrate on the employee’s productivity, goals, and personal growth.
When teams replace work groups, although individual performance reviews are still important, they become part of team reviews, in which the members are assessed not only on their own performance, but on the productivity of the entire team.
All employees should know just what’s expected of them on the job. Many companies develop and incorporate performance standards at the time they create a job description. In other companies, as the job evolves, standards are established.
In routine jobs, the key factors of performance standards involve quantity (how much should be produced per hour or per day) and quality (what level of quality is acceptable). As jobs become more complex, these standards aren’t an adequate way to measure performance. Ideas and innovations that are conceived in creative jobs cannot be quantified, and quality may be difficult to measure. This situation doesn’t mean that you can’t have performance standards for these jobs, but it does require a different approach, such as the results-based evaluation system described later in this chapter.
Performance standards are usually based on the experiences of satisfactory workers who have done that type of work over a period of time. Whether the standards cover the quality or quantity of the work, or other aspects of the job, they should meet these criteria:
Team Terms
Performance standards define the results that are expected from a person performing a job. For performance standards to be meaningful, all persons doing that job should know and accept these standards. Team participation in the establishment of performance standards is one way to ensure this understanding.
One way of setting standards that are understood and accepted by team members is to have them participate in setting them and encouraging them to make a practice of regularly evaluating their own performance against those standards. In this way members don’t have to wait for formal performance assessments to discover that they are not meeting standards. They see for themselves where they stand and can take corrective action immediately.
FYI
W. Edwards Deming, the father of the quality movement, strongly opposed performance reviews. He believed that, in most companies, performance was equated with quantity at the sacrifice of quality. This was the case for a long time, but quality standards today are given equal or greater weight in evaluations.
Individual performance standards remain important in the team environment, but they must mesh with the standards by which the team will be measured.
Some factors that must be considered in developing team standards are
Most companies conduct formal appraisals of employees on an annual basis. Annual reviews are not enough. Goals change during the year; performance varies during the year; problems that were never dreamed of when standards were set come up during the year. Performance reviews should be conducted at a minimum of four times a year. However, it is too time consuming and expensive to conduct frequent formal reviews. Informal discussions of performance should be ongoing. Semiformal brief meetings can be held with team members or the entire team several times each year.
The formal and sometimes semiformal review is standardized. A system is used so that all employees are measured in the same manner. In this section we’ll look at some of the more commonly used assessment systems.
You’ve been rated by them. You’ve probably used them to rate others. The most common evaluation system is the “trait” format, in which a series of traits are listed in the left margin, and each is measured against a scale from unsatisfactory to excellent.
Heads Up!
Evaluating team performance is not a substitute for evaluating individual performance. They are both important. Members should be held accountable for their own actions as well as their part in the collaborative efforts of the team.
This system seems on the surface to be simple to administer and easy to understand, but it’s loaded with problems. Leaders tend to fall into the following traps when rating members on a trait system:
When you rate your team members, don’t be overly influenced by their most recent behavior. Employees know that it’s rating time, and they’ll be as good as a kid just before Christmas. Keep a running log of their behavior during the entire year.
The best way to overcome deficiencies in the trait system is to replace it with a results-oriented system (described later in this chapter). However, if your company does use the trait method, here are some suggestions to help make it more equitable:
Rather than rate team members on the basis of an opinion about their various traits, in the results-based system the people who do the rating focus on the attainment of specific results.
Team Builder
Keep a record of specific examples of exceptional and unsatisfactory performance and behavior of team members to support your performance evaluation.
Results-based ratings can be used in any situation in which results are measurable. This system is obviously easier to use when quantifiable factors are involved (such as sales volume or production units), but it’s also useful in such intangible areas as attaining specific goals in management development, reaching personal goals, and making collaborative efforts.
In a results-based evaluation system, the people who do the evaluating don’t have to rely on their judgment of abstract traits, but instead can focus on what was expected from team members and how closely they met these expectations. The expectations are agreed upon at the beginning of a period and measured at the end of that period. At that time, new goals are developed to be measured at the end of the following period.
Here’s how this system works:
Some companies request that team members submit monthly progress reports compiled in the same format as the annual review. This technique enables both the team member and the leader to monitor progress. Studying the monthly reports makes the annual review easier to compile and discuss.
Team Terms
A KRA (key results area) is an aspect of a job on which employees must concentrate time and attention to ensure that they achieve the goals for that job.
Although results-oriented evaluations can be more meaningful than trait systems, they’re not free of problems.
Unless the team leader and the team member take an objective view of what he or she should accomplish, unrealistic expectations may be set. The danger is that they may be set so low that employees attain them with little effort, or so high that employees have little chance of attaining them.
Not all goals are equal in importance. Consider the value of the expectation in comparison to the overall goals of the team and the company. Intangible goals are more difficult to measure. Even intangible factors, however, have tangible phases that can be identified. For example, rather than indicate that a goal is to “improve employee morale,” specify it in terms that are measurable, such as “reduce turnover by X percent” or “decrease the number of grievances by Y percent.” Rather than state a goal as “Develop a new health insurance plan,” break it into phases, such as “Complete study of proposed plans by October 31” or “Submit recommendations by December 15.”
To make the results-based format even more meaningful, use the collaborative model. If performance evaluations are based on the arbitrary opinion of a supervisor, they serve only part of the real value of reviews. A results-based model provides a formal evaluation for the purpose of raises or promotions and enables you to tell employees how to improve performance, but it doesn’t involve team members in the process.
Heads Up!
If a team member gives himself or herself a significantly higher rating than you do, be particularly sensitive in the discussion so that it doesn’t degenerate into a confrontation. Use specific examples rather than statements of opinion to make your points.
The collaborative review can do this more effectively and is particularly useful for evaluating creative jobs such as research and development or jobs in the arts. Team members and their leaders jointly determine the standards that are expected, build in the flexibility to accommodate the special circumstances under which they’re working, and agree on the criteria that will be used in evaluating the work.
The team member and team leader then complete the evaluation form. The KRAs and the “results expected” items are agreed upon in advance (usually during the preceding review). The team member and the leader independently indicate the “results achieved.”
A variation on the collaborative evaluation is having team members evaluate their own performance before meeting with their team leader. Both leader and member complete a copy of the appraisal form. At the meeting, similarities and differences in the ratings are discussed, and adjustments in the ratings resulting from the discussions are reflected in the formal evaluation that’s filed with the human resources department. In some companies, if the employee still disagrees with the evaluation after the discussion, a rebuttal may be written and filed along with the team leader’s report.
At the appraisal interview (described later in this chapter), the team leader and the team member discuss the comments on the form. During this session, the appraisal begins to move from a report card to a plan of action for growth and teamwork.
Team Terms
In a collaborative evaluation, a team member evaluates his or her own performance, and the team leader also evaluates it. The final report results from a collaborative discussion between the team leader and the team member.
Collaborative reviews of performance have the following advantages:
As noted earlier, limiting reviews to once a year is not realistic. Members need more frequent feedback to keep on the cutting edge of their jobs. One solution is the mini-review—usually conducted monthly, but which could be done more frequently.
Members are asked to evaluate their progress for the past month by responding in writing to a series of questions.
At the appraisal interview the team leader and member discuss the member’s responses and develop plans to enhance the strengths, shore up the weaknesses, and set revised goals for the ensuing month.
In the traditional organization, supervisors rate their subordinates. When teams enter the picture, the supervisor, now team leader, usually still evaluates team members, but this is supplemented by team members rating each other. Why? Ratings by several people are likely to provide more objective results. Members work closely with each other. They really know how well associates do their jobs. Because ratings are made by several people, individual biases, jealousies, and personality conflicts are neutralized.
Peer appraisals can take as many forms as the traditional supervisor’s appraisal. They can be trait-based or results-based. They can be in numerical or narrative style. The important thing is that they be consistent and that all members be carefully trained in using the system.
Team Builder
Team leaders should note their comments on the monthly report form and keep copies in their files. Reviewing the monthly reports when making the annual formal appraisal will result in a much more realistic view of the progress of each member.
At the Jumphigh Trampoline Company team ratings are conducted quarterly. Each team member completes an evaluation form for each of the associates. After the team leader reviews the forms, a meeting is held at which the evaluations are discussed. The team leader reads a summary of what was reported. By keeping the individual reports confidential—members are not told who said what about them—evaluations are more likely to be frank and honest.
At the meeting all members discuss the evaluations and suggest ways of helping each other in the areas where help is needed. The team leader will also meet on a one-to-one basis with each member to add his or her suggestions, and to deal with sensitive issues that may have come up in the reviews, but not been broadcast to the group.
In some companies, all of the original peer evaluation forms are kept on file; in others only the team manager’s compilation is retained. Peer assessments, along with other assessments, become part of the body of information on which the formal performance evaluation is based.
Team Terms
Peer evaluation: Every member of a team is rated by each of the other members. The evaluations may be discussed in private conversations between the team leader and the member or with the entire team.
As pointed out earlier, the chief advantages of peer evaluation are the neutralizing of biases by any one rater, obtaining a variety of opinions on each member’s performance, and the opportunity for the entire team to share in identifying weaknesses in the team, and developing and implementing steps to correct them.
By having several reviews of each member’s performance, the team leader can write a more objective and more comprehensive formal assessment report.
But peer evaluations have a downside. Let’s look at some of the problems:
Following are some suggestions on how to overcome this:
For example: “When working together on a project, in what ways did the associate help move the project forward? In what ways did the associate hold up the project? In what aspects of the work did the associate excel? In what aspects of the work does the associate need to improve? Give examples of how this affected your work.”
Whether the formal appraisal results from an evaluation by the team leader, a combination of ratings by peers, or a 360 degree panel, there is usually a one-to-one sit-down meeting between the team leader and the member to discuss it. In many organizations, the member is also asked to rate him or herself as a prelude to the formal appraisal interview.
Before sitting down with a team member to discuss a performance appraisal, study the evaluation(s). Make a list of all aspects you want to discuss, not just those that need improvement but also those in which the member did good work. Study previous appraisals, and note improvements that have been made since the preceding one. Prepare the questions you want to ask about past actions, steps to be taken for improvement, future goals, and how the team member plans to reach them.
Reflect on your experiences in dealing with this person. Have there been any special behavioral problems? Any problems that have affected her or his work? Any strong, positive assets you want to nurture? Any special points you want to discuss?
Team Builder
Most people are uneasy about appraisal interviews. Allay these fears by making some positive comments when you schedule an interview. You can say, “I’ve scheduled your appraisal interview for 2:30 on Wednesday. I want to talk about your accomplishments this year, and discuss our plans for next year.”
Make the team member feel at ease with a few minutes of small talk. Then point out the reasons for the appraisal meeting. Say something like this: “As you know, each year we review what has been accomplished during the preceding year and discuss what we can do together in the following year.”
Note the areas of the job in which team members have met standards, and particularly the areas in which they have excelled. By giving specific examples of these achievements, you let team members know that you’re aware of their positive qualities.
Encourage team members to comment. Listen attentively, and then discuss the aspects of performance or behavior that didn’t meet standards. Concentrate on the work, not on the person. Never say, “You were no good.” Say instead, “Your work didn’t meet standards.” Be specific. Give a few examples where expectations haven’t been met. This is more effective than to just say, “Your work isn’t up to snuff.” Ask what the team member plans to do to meet standards and what help you can provide.
If the member’s problems aren’t related to performance, but rather to behavior, provide examples: “During the past year, I’ve spoken to you several times about your tardiness. You’re a good worker, and your opportunities in this company would be much greater if you could only get here on time all the time.” Try to obtain a commitment and a plan of action to overcome this fault.
Throughout the interview, encourage the team member to comment on or make suggestions about every aspect of the review. Of course, he may have excuses or alibis. Listen actively—you may learn about some factors that have inhibited optimum performance. For example, you may find out that someone has an older-model computer that has started crashing several times a day ever since the company upgraded the software. You may not have been aware that this recurring problem was affecting the member’s job performance. With this new information, you can take steps to correct the situation by budgeting for a computer upgrade. By giving the associate the opportunity to express his or her reasons or arguments, you can take steps to correct the situation.
Heads Up!
An appraisal interview isn’t the leader telling the team member, “This is what you did well, and that is what you did poorly.” It’s a two-way discussion about performance.
Even if a team member’s excuses are superficial and self-serving, allowing them to be voiced clears the air. Then you both can be prepared to face real situations and come up with viable ideas.
Many team leaders find it difficult to give criticism. Here are some guidelines to help deal with this sensitive area:
At the end of the interview, ask the team member to summarize the discussion. Make sure that the person fully understands the positive and negative aspects of his or her performance and behavior, plans and goals for the next review period, and any other pertinent matters. Keep a written record of these points.
Ask the member to develop an action plan to implement the changes that are to be made. This plan should be specific, listing actions in each pertinent area and timetables specifying when the plan will be started and completed. If new goals are set, list the goals and note when and how they will be achieved.
In many companies, team members who disagree with an evaluation are given the opportunity to write a rebuttal to be attached to the appraisal. When salary adjustments are based on ratings, some organizations provide a procedure for appealing a review.
End the interview on a positive note by saying, “Overall, you’ve made good progress this year. I’m confident that you’ll continue to do good work.”
In most companies the appraisal form is sent to the human resources department to be placed in the employee’s personnel file. Some companies require that a copy be sent to the next level of management—the person to whom the team leader reports.
Team Builder
If you’re a team member who disagrees with your review, send a polite memo to the team leader a few days after the meeting. Point out some recent achievements that may have been overlooked in the review. Although this may not help in the current appraisal, it will be in your personnel file to be noted if interim reviews occur before the next formal appraisal.
Even if it’s not a formal practice in your company, it’s a good idea to give a copy of the appraisal to the team member. It serves as a reminder of what was discussed at the appraisal interview and can be referred to during the year. And, if it includes goals the employee and you have agreed upon for the year, the employee can reread it from time to time to keep motivated.
Performance appraisal is an essential tool in team leadership. Not only does it enable the leader to keep tabs on each member’s performance, but more important, it encourages members to evaluate their own performance on an ongoing basis and take steps to work toward improvement.
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