Just the thought of preparing and executing an annual performance appraisal sends chills down the spine of many a senior manager.
Performance appraisals are nothing more than a collaborative conversation between individuals about opportunities to increase an individual’s skill sets and value to their employer. The keys to a successful performance negotiation conversation lie in detailed preparation and the ability to communicate with the other party the importance of maintaining or improving their performance.
It’s important to schedule these conversations on a timely basis, such as the hiring anniversary date.
I have been tasked by a local nonprofit to assist its leaders in developing their performance appraisal process. How do you build the process? That was the first question they posed. The answer is: From the bottom up. The first document required is an updated job description for each position in the organization. This permits the appraiser, the immediate supervisor, to focus on performance and relate it directly back to the job description.
The second document you need is the appraisal form. This form should have a number of sections that relate to company policies and procedures, the strategic plan (if one is in place), personal development and departmental goals. There also should be a summary section that would include the comments of the appraiser and the individual being appraised. The form should also include a blank section that can be customized to the responsibilities of the job as outlined in the updated job description.
While constructing the appraisal form you need to consider the scale you will use and how you will rate each category. I suggest a seven-point Likert scale. The ratings would be: too new to review (TNR), needs improvement (NI), below average (BA), average (A), above average (AA), very good (VG) and excellent (E). This scale prevents supervisors from rating too many of their reports average.
The last section, the summary section, would indicate the overall rating as seen by the supervisor completing the form. These ratings should appear at the top of each element being appraised and the comments in that section should support the rating selection. It is important that on the first page of the performance appraisal, these ratings should be defined so that they are consistent among the supervisors and that the individual receiving the ratings understands their meaning.
The two first ratings, “needs improvement” and “too new to review,” are ratings that need to be clarified. Needs improvement signifies that the individual is not performing his or her job in this area to any minimum level of satisfaction. This type of performance needs to be addressed immediately, since it significantly impacts the overall rating. The section that addresses goals should include specific performance goals that need to be met in no more than 30 days. This is when a second performance conference would be held to ascertain if improvement has been demonstrated.
When someone receives a too new to review rating, that signifies that he or she has not been in this position or had this particular responsibility for a sufficient period of time to assign a rating. This skill or responsibility would be revisited in a future appraisal conference.
The rating scale that has the greatest confusion among raters and employees is average. To me average means that the employee is doing his or her job as outlined in the job description. In my opinion, average performance should not be rewarded with more than a standard of living adjustment in salary. Many employers do not even award a cost of living increase. Average may be acceptable, but not a desirable level of performance. During the appraisal conference, employees should be motivated to perform above the average level in order to receive more recognition in the form of salary adjustments. Too many supervisors lump employees into the average category to avoid confronting the difficult topic of improving performance.
One component of the performance appraisal discussion that should be included in the process is that of a self-appraisal. This component of the process increases the amount of communication between the appraiser and the person being appraised. This interaction between the parties permits the person being appraised to rate his or her own performance and create the basis for a dialogue. The appraiser can then respond to each point outlined and the parties can agree on the rating, agree to disagree or amend the rating after a full discussion of each other’s perceptions.
The goal of a performance appraisal is to have a collaborative conversation and the self-appraisal component will increase the level and content of the conversation. The employee will leave the appraisal session feeling that he or she had input and was heard. Employees also have an opportunity to buy into performance goals they helped craft. It becomes a collaborative negotiation between the parties and not a one-way conversation. This approach has a positive impact on performance and builds a relationship between the parties, as well as an open communication channel.
You have the opportunity to make your next performance-appraisal conference a positive experience for both parties and not the dreaded conversation.
Cary Silverstein, MBA, is the president of SMA LLC and The Negotiating Edge. He leads a group that provides services in the areas of strategic planning, negotiation training and conflict resolution with offices in Fox Point and Scottsdale, Ariz. He can be reached at (414) 403-2942 or at csilve1013@aol.com.
