Hi, today's Bite is all about performance appraisal,
what it is and how to implement it
by looking at AIHR's top five best practices, stay tuned.
What is a performance appraisal?
Performance appraisal is also referred to
as the performance review, performance evaluation,
and employee appraisal.
Performance appraisal is a method to regularly evaluate
an employee's job performance and overall contribution
to the company in an effort to improve that performance.
Performance appraisals help to provide feedback,
it is a formal moment intended to evaluate job performance.
It also helps in making key employee decisions
including giving bonuses, promotions, and firing.
A crucial element of the employee appraisal
is that it is a shared responsibility.
On the one hand, it is a shared responsibility
between the employee and manager.
While the manager has the lead in this process,
an active involvement of the employee creates the buy-in
that is necessary to make the improvements
that the performance appraisal is set up for
in the first place.
On the other hand, conducting performance management
is also a shared responsibility between the manager and HR.
The manager does the execution
but HR helps in guiding the performance appraisal process.
What are the five key success factors
of a performance appraisal?
Every company conducts
their performance appraisals differently,
however, there are several best practices
that every manager should know.
One, use a clear outline.
Both managers and employees may feel uncomfortable
during the performance appraisal.
It is arguably the most formal setting
they will be in all year and it doesn't happen often enough
to make it a common phenomenon.
Using a job performance evaluation form
or some other appraisal outline will be very helpful
for both the preparation of the meeting
and for doing the performance review itself.
We attach a link to a performance evaluation form below
as an example.
Two, involve the employee as much as possible.
One of the key challenges in employee appraisals
is creating buy-in from the employee.
This is backed up by science,
a meta-analysis found a strong correlation
between the participation of the employee
in the performance evaluation and their buy-in.
Employee participation is the extent to which employees
are able to participate
in the performance appraisal session.
Employees who participated in their performance review
were more satisfied, rated the session
as much more fair, useful,
and were much more motivated to improve.
The meta-analysis we mentioned previously
found that a high degree of employee participation
explained up to 40% employee satisfaction,
35% of perceived fairness, 30% in perceived usefulness,
and 19% in motivation to improve.
This shows that it definitely pays off
to involve the employee.
Three, start with the bad news.
Most of us have learned to start with good news
before delivering the bad news
and suggestions for improvement.
According to Daniel Pink, employees are more satisfied
when bad news is addressed early on in the interview.
Positive information is then saved until the end,
so the meeting will end on a positive note.
Four, employees want more regular feedback.
Getting feedback once a year is not something
that will drive performance.
Employees report they're looking
for regular continuous feedback to do their work better.
Find ways to let managers touch base
with employees continuously using technology.
Five, carefully document
your employee performance appraisal sessions.
Important decisions about whom to promote,
which salaries to raise, but also who to terminate
are based on performance management information.
Performance appraisal meetings should, therefore,
be meticulously documented.
Performance data should be assessed and reported
in a standardized way across the organization
and stored in a central database.
This is also important when you switch
to more continuous feedback.
This wraps up our Bite on the performance appraisal.
In this Bite, you learned what a performance appraisal is,
and five best practices to implement it
in your own organization.
If you want to know more about performance appraisal,
check out our in-depth written article
in the description link.
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and I'll see you soon in our next Learning Bite.
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