The Horror Story that is Performance Appraisals
Performance reviews. The name alone is enough to make most people roll their eyes.
Pretty much everyone you speak to has a horror story..
- Maybe the one where the boss wasn’t prepared at all..
- Or the one where it was a tick and flick and the boss couldn’t care less and it was just something “HR made them do.”
- Perhaps the one where the boss saved up a years’ worth of issues to dump on you.
- Maybe it is the one where the boss mocked your self assessment and told you that you’re joking if you think you’re that good..
- Or the one where your boss read from a script and didn’t even look you in the eye at all.
- And so it goes on…
I am sure you have your own version to tell.
McKinsey had this to say about them:
Employees still complain that the feedback they get feels biased or disconnected from their work. Managers still see performance management as a bureaucratic, box-checking exercise. Half of the executives we surveyed told us that their evaluation and feedback systems have no impact on performance—or even have a negative effect. And certain experiments have gone awry: at some companies, eliminating annual performance reviews without a clear replacement, for example, has led employees to complain of feeling adrift without solid feedback—and some employers to reinstate the old review systems.
In short, performance reviews or appraisals have a bad name. And rightly so when you think that often remuneration, bonuses or promotions are riding on them..
SCARF Model
Dr David Rock famously designed the SCARF Model to describe the common factors that can activate a reward or threat response in human beings – status, certainty, autonomy, relatedness and fairness.
With thanks to Clayton Wehner for the use of the image.
In summary, that a perception of unfairness will trigger a threat response in the brain: leading to a fight/flight/freeze response. This makes sense. Think about the last time you thought that something was really unfair. It can manifest in anger (either manifesting in actual anger or tears of frustration). It can also manifest in the brain just going completely blank. Or a desire to get away from the situation as quickly as possible. The irony of course is that this the point that the brain most needs to be actually working properly to address the perceived unfairness. But it’s often just not operating from the right place in the brain to do that.
Now think about how many of those horror stories above led a feeling of “that’s just unfair”.
McKinsey Research
Interestingly, McKinsey’s most recent research reinforces what we know about the brain:
The fairness factor
When we speak of fairness, we’re suggesting a tight definition that academics have wrestled with and come to describe as “procedural fairness.” It’s far from a platonic ideal but instead addresses, in this context, the practical question of whether employees perceive that central elements of performance management are designed well and function fairly. This eye-of-the-beholder aspect is critical. Our survey research showed that 60 percent of respondents who perceived the performance-management system as fair also stated that it was effective.
More important, the data also crystallized what a fair system looks like. Of course, a host of factors may affect employee perceptions of fairness, but three stood out. Our research suggests that performance-management systems have a much better chance of being perceived as fair when they do these three things:
- transparently link employees’ goals to business priorities and maintain a strong element of flexibility
- invest in the coaching skills of managers to help them become better arbiters of day-to-day fairness
- reward standout performance for some roles, while also managing converging performance for others
Such factors appear to be mutually reinforcing. Among companies that implemented all three, 84 percent of executives reported they had an effective performance-management system. These respondents were 12 times more likely to report positive results than those who said their companies hadn’t implemented any of the three.
The Takeaway
Here’s what we know..If we want the brain engaged and working from the prefrontal cortex not the limbic system of fight/flight/freeze, then we need to ensure we don’t create a threat response.
How we do that is to ensure we are not just following a process. It is the people part of the process that makes it work… And helps people see that it’s fair and reasonable.
So make sure the process makes sense; that it is linked to KPIs that are meaningful to an employee.
Make sure (and this is a BIGGIE) that managers have the skills to be able to skilfully manage the conversations and provide constructive corridor coaching.. Have managers that can have difficult conversations in a way that doesn’t put the brain on high alert.
And have a reward and recognition system that actually rewards and recognises.. And that employees can recognise as fair. And transparent.
Then maybe we will get some positive return on investment for the enormous amount of time spent in reviews and appraisals each year.
More Reading..
Your guide to delivering feedback
The fairness factor in performance management
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