We’ve known for more than 50 years that the traditional performance appraisal doesn’t work – yet we keep using it! In 1965, the Harvard Business Review reported the results of a landmark study which tested the effectiveness of traditional performance appraisal systems at General Electric and found them ineffective (Smith and Rutigliano).

Still today only 56% of employees agree that their managers provide them with high quality feedback. This means that only half of employees receive effective feedback or guidance to help drive improved future performance. Managers need the tools and practice through training to reach the other half with helpful, directive feedback (McLean & Company Engagement Survey, 2016, N=65,282).

The “same old” performance appraisals are ineffective because they are not adaptable, they are poor drivers of performance and they are often de-motivating. Ineffective performance appraisals result in huge pains felt across all levels of the organization, including disengagement, turnover, and wasted productivity hours.

While Agile Performance Management has been a topic of popular conversation, only a handful of organizations have been organizationally ready to move directly to this high-velocity approach. Modernizing the performance appraisal is a solid step in moving towards agile performance appraisals. In this blueprint we recommend a five-step process that moves from the design of your own modernized performance appraisal framework through to the follow-up process.

Modern appraisal touch points incorporate more regular expectation and goal setting, feedback and coaching, and assessment. A study done by the Institute for Corporate Productivity reported that these performance management activities had a moderate to high correlation with business success; when there is an increase in the use of these initiatives, there is a moderate to high increase in business success.

This blueprint will help you to:

-          Increase the frequency with which managers and employees get together for meaningful discussions. We recommend quarterly check-ins and one year-end review.

-          Use core competencies that apply to every role in your organization to further clarify expectations throughout your performance appraisal process, and assign proficiency levels based on job grades, tiers or job descriptions.

-          Hold a focus group with a cross-section of managers and employees to develop performance ratings that are unique to your organization or alternatively, you can use the McLean & Company performance rating scale.

-          Get employees to build their personal goals around department or organizational-level goals, and develop a uniform model for all employees and managers to use during PAs.

-          Hold managers accountable for providing regular quality feedback and coaching. Spend some time upfront and educate your managers on what you expect of them when it comes to feedback and coaching. The training decks provided will facilitate this.

-          Use the 3C model to frame feedback, this consists of “Context-Communicate- Confirm”.

-          Collect results and ratings from check-ins to understand and identify who the players are on managers’ teams.

-          Communicate with managers and employees separately to ensure they understand the new process and accountabilities and know where to find additional resources from HR.

-          Conduct manager calibration sessions to ensure employees are being appraised fairly across the organization.

To access this Blueprint go to www.aseonline.org login with your member credentials. Once logged in go to the McLean & Company link under the My Resources section in you Dashboard . After you are on the McLean & Company site you can copy the below link into your browser:

https://hr.mcleanco.com/research/ss/modernize-the-performance-appraisal