Business Performance Blog
We share our news and reflections on the world of business.
Join our discussion on the latest research, reports and opinion.
Performance Appraisals – How to Use Numerical Ratings
Submitted by Leslie Allan on July 27th, 2011
Lately I’ve been sounding off about the damaging effects on employee morale of putting a numerical rating on each individual. This typically occurs during the annual performance appraisal cycle. I’ve been saying that we need to throw out summary rating scales altogether.
Managers and employees alike get so hung up on whether an employee is a ’3′ or a ’4′ that the basic message gets lost entirely in the pent up emotions released when fighting over a number. And tying the magic number to a reward, whether it is a promotion, salary increase or a bonus, only further blackens the emotional blind spots -not to mention the resulting fractured working relationship from that point forward.
I am often asked whether numbers can be used at all during the appraisal process. I am a firm advocate of using measures to plan and review business performance. So, how can a disdain for putting people in numbered boxes be reconciled with a strong measurement focus? Here is how I think numbers can be used to great effectiveness in a well-performing performance management system:
1. Multi-rater feedback systems
Where appropriate and in places where trained facilitators are available to debrief, use one of the popular 360 degree feedback survey instruments to rate employee and team behaviors. The trick here is to not summarize all of the specific scores into an overall figure and apply to an individual. Centre the discussion on the feedback score for each behavior, discussing key strengths and developmental opportunities. Using a multi-rater instrument also avoids the perceived subjectivity of an individual manager ticking a number on a rating scale.
2. Goal setting and review
For each individual and team, set agreed and measurable targets. For example: “At least 10 out of 12 monthly reports submitted by the end of the month.” “Defect rate less than 2% by end of year.” These are objectively measurable and focus the discussion on outcomes and what is needed to meet targets. The focus is off notions of individual worth.
Yes, setting measurable targets is difficult for many managers and supervisors. I’ve met some that would rather have their tongue pierced with a red hot iron. And yes, many managers find it excruciating having to have an honest but respectful conversation with an employee about their performance. Bestowing a largely subjective assessment of ’2 – Needs improvement’ may seem easier; the manager doesn’t need to do much work to declare a number. However, the cost in nervous sweat and bottoming morale is high.
Do you need help with implementing your new performance management system? Many implementations fail because the change process was not handled well. If you need to keep managers and employees on board throughout your organization’s change journey, get a copy of my Managing Change in the Workplace guide and workbook.
The guide covers every aspect of managing change effectively and uses my unique CHANGE Approach to getting all affected on board and working towards the new way of doing things. As you work through the guide, you will complete a series of practical exercises that will help you plan and manage your change for maximum impact. Find out more about Managing Change in the Workplace and download the free introductory chapter today.