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Performance Appraisal Systems
How to Make Them Work

By Peter Wildblood

Performance appraisal systems are at the heart of effective two way business relationships between team leaders and their team members. At least they should be if they are carried out with the right approach and with the appropriate degree of commitment by all parties involved!

There are two main reasons why performance appraisals tend not to work.

First the appraisal system itself, and the accompanying documentation, is often badly designed. Second and most important is that the underlying relationship between team leader and team member is often quite poor. Performance shortfalls by team members have not been picked up or spoken about. The team leader has omitted actions which could have done to better support team members.

This article is about how to convert appraisals into win-win occasions for team leaders and for team members.

First, let's look at the nature of performance appraisal systems.

After a lot of experience in designing and operating performance appraisal systems, I find the very best appraisal system is one that occurs in an ongoing way, when the relationships between the team leader and team members are sufficiently high for there to be ongoing recognition of good performance, when appropriate praise is given, and when poor performance is corrected as it occurs. After all, you would not think much of an air conditioning system which monitored air temperature once a year.

In high performance teams, team members are able to comment on the performance of the team leader, saying what works for them and what doesn't, pulling the team leader up when he or she fails to meet a key commitment, or agreed standards of behaviour. Put this kind of freedom of speech and behaviour in place in your team and it is almost as if an appraisal system is no longer needed. The focus moves from a backwards looking critical assessment of shortcomings not previously spoken about, to a forward looking focus on the developmental needs of team members and the team leader.

A good work relationship will not only withstand this kind of honesty and integrity; it demands it!

At their worst therefore, appraisal systems are a [poor] fail safe mechanism when no ongoing feedback is given. At their best, they are an integral part of the developmental program for team members and a framework for providing appropriate recognition.

A properly designed appraisal system contains three principal elements.

First there is the statement of performance objectives for the individual. This describes the outcomes expected of team members, how they are measured, and when they are to be completed.

Next there is a statement of the specific support to be provided by the team leader in order for team members to reach agreed objectives. This describes the special skills the team leader can assist with and the training required. There may be additional resources required and these should be specified with a delivery date.

Finally there is the appraisal interview itself. This has a number of functions. First it is a review of performance in an overall way against the previously agreed outcomes.

The primary focus of the interview, however, should be on the future. The goals and objectives your team member has for his or her career development should be discussed along with how they can best be expressed. The team leader should ask how he or she can support these goals. This facilitates agreement on specific performance objectives for the ensuing period. These should take account of revised team objectives to be fully effective.

A key element of the "perfect appraisal system" is its mutuality. Team members and their team leader must be allowed to take responsibility for making the overall relationship work and for the effectiveness of the appraisal system and the associated interview.

It is also important to make sure that the appraisal system is simple and readily adaptable for each work situation. One of the best ways to ensure the effectiveness of an appraisal system is to closely involve all team members in the development of the scheme and its continual review.

Put all this in place and performance appraisal systems become an integral part of the work of a team.

Tips for Team Leaders:

Work towards an honest open relationship with two-way feedback a constant feature of team relationships. Spend time in understanding your team members' values and in respecting the genuine differences which exist.

Provide day-to-day feedback to your team about their performance - praise what's working and moving toward the objectives you have agreed upon. Relate individual praise to overall team performance.

Ensure the principal outcomes for the team and for its members are clearly specified. Understand the level of skill your team has in doing the task and how this is affected by their "motivation" for the task.

In setting up an appraisal interview, stick to your commitment about the interview time. Allow for more time than you anticipate and make sure you are uninterrupted for the whole of the interview.

Keep the focus of the interview on the future. In commenting on overall good performance talk about how this can be extended to the future. In discussing "improvement opportunities" work toward agreement on new behaviours and higher standards. Encourage genuine two-way discussion.

Ask what you might do to support the performance agreements and behavioural change you agree for the team member on any training or coaching necessary.

Follow up on the interview with confirmation of the agreements made. Set in place action steps as soon as practicable. Keep team members them informed and involved.

Maintain your commitment to ongoing positive feedback; go out of your way to discover the good things your team members are doing. Praise them for their effort and their achievements.

Make sure you reward considered risk taking and support people in the learning they derive from their mistakes. Encourage ownership.

Tips for Team Members:

Work towards an honest open relationship where two-way feedback is a constant feature of your relationship with your team leader. You have as much responsibility to make sure that this is established and maintained as has your team leader.

Provide feedback to your leader about the extent to which he or she has supported you and the team. Relate this to the agreement you have made at the previous review.

If goals and outcomes are not clear to you for any reason, ask. Make sure you know what is to be done, to what standard and by when. Ask for the level of support you feel you need: resources, authority, personal coaching.

Refuse (politely) an interview when you suspect it might be "rubbery", or when you think it might be too closely jammed with another appointment.

If the interview is interrupted, remind your team leader how important the discussion is to you and the work of the team. Ask whether the meeting can be re-convened at a time when he or she is able to concentrate fully on it.

If your team leader is focussing on the past, ask what specific outcomes he or she might want of you to avoid the "problem" in the future. Suggest any training you might feel useful or necessary. Ask for any coaching you think would be useful. Indicate your commitment to meet the performance outcomes agreed.

Ask you team leader for changes in his or her behaviour which would make it easier for you to meet the performance objectives agreed - more time - less "control" - specific authorities - more feedback in certain key areas - more specific project definition etc.

After the interview, get some quick "runs on the board". Establish some momentum for your agreed outcomes - indicate commitment. Confirm your understanding of your objective in some appropriate way.

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Last modified 16/06/2009