• Choose a category
• All
• Classic-Fiction

In short, while performance evaluation systems may vary from organization to organization, they should all aim to measure an employee’s ability to reach their goals in a consistent and fair way.

Red Flags

WHY PERFORMANCE EVALUATIONS SKEW

Certain standard problems tend to occur in evaluating the performance of a department or group of individuals. Be wary of making these judgment errors:

Central tendency error–The tendency to find all employees average and to assign average ratings to all areas of the evaluation form.

Contrast effect–The tendency to give lower ratings to an average employee who is evaluated right after an outstanding employee is.

Halo effect–An unconscious attempt to give an employee ratings that match an overall impression or preconception you have of that person.

Leniency or harshness error–The tendency to view everyone as either good or bad.

Personal bias error–The tendency to give higher ratings to employees you like, or to employees who are generally well liked by others.

Recency of events error–The tendency to focus on more recent behavior and overlook past situations, whether positive or negative.

Evaluation Pitfalls

Clarity, simplicity, and objectivity in performance review systems are the ideal, but putting theory into practice can be a challenge. Be aware of potential obstacles to effective goal-setting and performance evaluation.

The inherent flaw in any evaluation system is that ratings are typically based on opinions, and opinions are subjective. Some managers are generous in interpreting evaluation criteria, while others may be rigid and even stingy. Specialized training in observation and reporting methods can improve a manager’s ability to rate employees objectively.

The design and procedures of a company’s rating system affect its success. If evaluation criteria are difficult to apply, if the procedures are cumbersome, or if the system seems to be more form than substance, participants are likely to disregard the whole process.

Conducting a Formal Evaluation

A performance review is a formal conversation and is therefore different from a casual chat in the hallway. For many new managers, their first performance evaluation means treading unknown territory. Conducting an evaluation is not simply a matter of saying, “I assume you’ve met all your goals” or, “If you didn’t meet your goals, we have a big problem.” Your job as a manager is to analyze the underlying causes that have led to the employee’s success or failure and then communicate that to the employee so he or she can continue to improve and reach his or her objectives.

CASE FILE

FROM ‘RATINGS CREEP’ TO CUSTOMIZED GOALS

Several years ago, managers at St. Jude Children’s Research Hospital in Memphis realized their performance evaluation program was suffering from “ratings creep.” Supervisors had stopped using all but the top two of the five rankings available and so most employees had come to view the “meets expectations” ranking as negative. Moreover, the system was hard to apply uniformly among the various hospital groups—secretaries, researchers, doctors, nurses, and administrators.

St. Jude completely overhauled its system, replacing it with one that was easy to use and that worked well for everyone, while painting a clearer picture of how employees are doing. Managers work with each staff member to plan goals, and employees who do more are in line for special rewards and plum projects.

SOURCE: “Employees Don’t Respond to Most Performance Plans” by Scott Cohen, Wall Street Journal (October 11, 2004).

One reason managers say they hate conducting formal reviews is that they often involve confrontation. Who wants to deliver bad news and criticism, hurt someone’s feelings, or be the object of animosity? It’s easier to wait for the problems and issues to go away. But they rarely do. Being honest with an employee is far more effective than avoiding a discussion about that employee’s underperformance. It’s never a good idea to wait for