Why Your Performance Appraisal System Isn’t Working

By PrismHR

As a business owner, you know that a good performance appraisal system is an integral part of helping employees grow and develop within the company. Most organizations implement some type of tool that can be used to evaluate employee performance, but the problem is that the performance appraisal process doesn’t achieve the desired results. When the results aren’t achieved, then the most common approach is to change the system in an attempt to improve the performance appraisals.

Consider this: What if your performance appraisal system works just fine, and the problem lies in the way the process is being implemented?

If you want to create real, lasting change within your business, then you need to take a close look at the system as well as the methods that are being used to implement the system. Most of the time, performance management systems are well designed, which means that the problem is usually found in the people who are using the system.

Here are some of the common pitfalls in the way the performance appraisal process might be implemented by the people in your company:

1. All Employees are Evaluated Using the Same Factors

A good performance appraisal system will have different options available, to ensure that the evaluations are catered to the job description of each employee. If management is evaluating every employee with the same competencies, then it’s a sign that the system is being used in the wrong way.

It is common for management to get lazy and use the same exact template and factors for every employee on the team. The only way it would work is if every employee has the same job requirements and they have been at the company for the same amount of time.

For example, do you think a new hire receptionist should be evaluated in the same way as a veteran computer networker? Their job requirements and skills are different, and these factors need to be considered in the performance appraisal process.

2. Everyone Receives the Same Scores

As you are browsing through the performance appraisal results, do you notice that all of the employees on a team seem to receive the same scores across the board? Sometimes managers get stuck in the rut of marking each evaluation in the same way, resulting in above-average scores for everyone.

The best employees should be rated above everyone else, and you should be able to look at the numbers and get a feel for who the above average people are. Managers need to consider the overall performance of each employee and mark ratings that match up to the performance of each person.

In your performance appraisal process the best employees should be rated above everyone else, and you should be able to look at the numbers and get a feel for who the best performers are.

3. Appraisals are an Afterthought

Even the best performance appraisal process won’t be any good if the program isn’t used consistently. Make sure that managers are implementing the system throughout the year and putting in the effort needed to set goals and evaluate the progress of each employee.

You should be able to look at the appraisals and tell if thought and effort was put into the ongoing meetings and discussions. For example, if the manager is required to meet with an employee four times a year and you notice that all four meetings happened in 4th quarter, then it is a good sign that the appraisal process was more of an afterthought than an integral tool to improve employee performance.

4. Employees Have No Input

The purpose of a good performance appraisal system is to help the employee develop their skills, set goals, and grow within the company. In order for this system to be effective, you need to make sure that the employees can offer their input.

Do the employees have a chance to provide their suggestions for the goals that they are working to achieve? What happens if an employee needs extra support along the way… do they feel comfortable to talk with their manager to ask for help?

Make sure that employees know that the performance appraisal process is a 2-way conversation, and their thoughts, ideas, and suggestions are always welcome. If they can’t speak up, then the system isn’t being used to its full potential.

5. Inconsistent Evaluations

When you are using a good performance appraisal system, it should incorporate the opportunity for the appraiser to give number ratings in different categories as well as providing written feedback for those categories. When the system prompts for this information, is the appraiser providing fair and equal feedback about each employee?

For example, you might notice that the performance appraisal for one employee includes long, detailed paragraphs with a lot of information, while another appraisal has short 1 – 2 sentence responses. The discrepancy shows that the manager is not using the performance appraisal system equally with all employees.

Employee performance appraisals will help guide decisions about retaining the best talent for your organization.

Training Your Team to Use the Performance Appraisal System

Setting up the performance appraisal process is just the first step, because you need to make sure that your team of employees is using the system in the right way. With proper training, your managers can use these tools to help their employees grow and develop with the company, resulting in higher levels of success for everyone involved.

If you don’t have a performance appraisal system in place, then we invite you to contact us to learn more about PrismHR Performance Management. We’ve developed a high quality program that makes it easy for your team to implement effective performance appraisals, and we can also help with the training so that your team is using the software in the right way.

Schedule a demo to see how our performance appraisal platform works.