This is the third article in a series about why performance appraisals fail to correct poor performance.

So far, we’ve seen the contradiction that exists between the meaning of the word appraisal, and what they are actually used for.

To appraise, means to give praise, and yet they’re usually used as a means to criticise, to identify flaws, and even as the basis for punitive discipline.

We’ve also learned several reasons why they cause emotional pain.

 

One is that rather than dealing with the problem when it occurs, the “offender” has to wait weeks if not months in order to find out what the impact of messing up will have on the annual review.

So for however long it is before that happens, that person comes to work in fear. People who are afraid tend to withdraw - from their circumstances, from those around them, and especially from the one who is giving the appraisal.
Not only do people avoid situations where they will be told they’re wrong, so do those who have to tell them. And so the problem remains unsolved, to the detriment of everyone else who comes in contact with it.

And if employees mess up and don’t know it, and their supervisors don’t say anything about it until the appraisal, then they’re likely to repeat the behaviour until then because, as far as they’re concerned, it’s okay.

 

The last thing we looked at was the paradox of time.

On the one hand very little time was available to learn about the accomplishments of those being appraised.

On the other, simply going through the process itself consumed a colossal amount of it.

 

In this article, we’re going to think about how managers abuse them.

We’ve already covered this a little bit.

Remember the definition of the word.

To appraise means to give praise.

When they are used for anything else, then they’re being abused.

That’s because they’re being used for something other than what they were intended.

Just think about how much success you’d have trying to claim on the warranty for some expensive tool if the company you bought it for discovered that you didn’t use it as instructed.

You’d have to review the history of the words used prior to performance appraisal in order to verify this, but the terminology sounds more like an attempt to be political correct than anything else.

You can almost hear someone saying, “We can’t call it a report card. That sounds too negative. Like you’re still at school. I know. Let’s call it an appraisal. That's so much better. Most people will be too lazy to look up the word anyway”.
When you consider what it is, report card or school report is probably closer to the mark.

 

How do managers abuse performance appraisals?

The first way is by superimposing a quota system on them.

Explicitly or implicitly they are told: “Most people should get a satisfactory rating. No more than 15% should get above average, and only about two percent should get top marks”.

 

Do you recognize this spread?

It comes from what you might know as a bell-shaped curve. The right side of it, anyway.

What’s wrong with looking for this pattern among the performance of your employees?

 

Everything.

For one thing, the bell-shaped curve represents the frequency of occurrence in a random sample.

Your workforce is far from random.

When you hired your employees, you picked the best people you could find from those who were available, right?

So that means that, in most cases, your staff are above average to start with.

That being the case, why is it that when it comes to appraisals, you assume that they aren’t?

Are you admitting that in the majority of cases, your recruiting and hiring process is a dismal failure; that somehow after forcing candidates through your rigorous assessment centre, that the best you could do was get a bunch of people with average talent?

So  using the bell-shaped curve as a means to justify the frequency of various ratings within your organisation is an abuse of the statistical method because you can’t satisfy the grounds for using it.

 

The next thing is that you put your people in competition with one another.

Read the next sentence very carefully and think about the ramifications for your organization.

When people are forced to make a choice between competing and cooperating, they’ll choose competing every time.

Did you get that?

If you want people to work together, then you can’t put them in a position where they see themselves in competition with their peers.

You an argue all you want about this, but it won’t change the fact that with the rarest of exceptions, nearly everyone will look out for Number One.

And No. 1 is hardly ever, the other guy.
That’s not to say that people will be devious or dishonest, though some will.

What it means is that if sharing information or expertise will enable someone else to get a higher rating at the expense of the person who shares it, then the word will get around, and it will stop.

People will protect their knowledge; not share it.

If you have teams, or if you want people to work together, then your reward system has to support that; and if you operate some kind of quota that limits how many people can get top ratings, and then scale it down, you’ll destroy any sort of cooperation in your organisation.

Whatever rating systems you use must have standards of excellence; but if everyone reaches them, then all of them should be rewarded equally.

Now the thing is that performance ratings are often tied to bonuses, a further abuse of appraisals.

If the pot is limited, and it usually is, then managers will want to give more to their highest performers and less, or even nothing, to those who don’t do as well.

And the quota system enables them to do that.

Unfortunately, the quota system by definition, prevents everyone from being recognised for peak performance, even if they’ve reached it.

When that happens, subjectivity comes into play.

Those who aren’t rewarded even for high quality work start looking for other jobs.

This is just one way that organisations self-sabotage their recruitment efforts.

There’s a question of ethics here, too.

 

If you massage the data so that your employees fit this pre-defined bell-shaped curve, then you’re simply lying about the results.

You’re telling employees that it doesn’t matter about the quality of their performance.

You’ve already decided who will be promoted, and who won’t; who will get a high rating, and who won’t; who will get a bonus, and who won’t.

To them, it will seem arbitrary.

They will see themselves as being harder workers, better performers, and more deserving than those who were promoted or who received bonuses.

And Mr / Ms Manager - when that happens, your troubles really begin.

Morale sinks.

It can die in seconds.

It’s very difficult to get it back, and if you’re the cause, you may never get it back from the people that you stiffed.

 

There’s another facet to this that must be mentioned.

It’s called the halo effect.

Think of it as type-casting.

Employees who get satisfactory ratings tend to always get them.

That’s because once they’ve had one, it’s what you expect them to have.

The same thing is true for those who are outstanding.

If you give them a high rating, then you expect that they will perform at a high level the following year.

We all of us tend to see what we expect.

That means that you will see satisfactory performance in the person who you expect to be satisfactory, but probably will miss or dismiss superior performance as a one-off.

The same thing is true of those for whom you have given a high rating.

You will expect them to perform at a high level all the time and, if there’s a problem, then you’ll tell yourself that it’s not that serious, or that they were having a bad day, or that it won’t become a habit, or just about anything else except that it’s a problem that needs to be addressed.

And the thing is that if the satisfactory employee messed up in the way that the outstanding employee did, you’d be onto him / her like a tonne of bricks.

 

Do you see the bias? Even the hypocrisy?
You probably didn’t know that you had it in you?

We all are capable of this. That’s one reason why it’s so important to do all you can to guard against it.

There’s another principle at play here, too.

It’s that of consistency.

Once we decide that something is true, it’s rare for us to change our minds.

Sales people know this.

That’s why they try to get you to accept a free gift or to buy something that’s inexpensive.

When you accept what they have to offer, however small, psychologically you’re approving of them.

And then when they come to you to ask for something larger, your desire to remain consistent with yourself makes it easier for them to persuade you than if they asked you cold.

So between the halo effect - seeing what you expect to see - and your own propensity to be consistent, you make it nearly impossible for anyone to improve above average once you decide that that’s what a person is.

 

And there’s one other thing.

Doing so also makes it unlikely for that person to impress new managers favourably.

Why?

Consider this.

When you take on a new supervisory role, and you manage people that you’ve never met before and know nothing about, how do you rate them at appraisal time?

 

Do you start from scratch?

Do you take out a clean sheet of paper and start over, or use a blank form provided by the company?

If you do, then you’re among the very few that do.

Many managers will read the previous one or more appraisals in the company files.

Why?

Because they don’t want to run the risk of rating someone much higher or much lower than they should.

They don’t want their boss asking them to justify the rating, nor do they want a grievance filed by the employee.

You see, others expect you to be consistent, too, no matter how objective you want to be.

And new supervisors especially may not know what to write in the comments regardless.

So they’ll use the old ones as a kind of template.

 

All this can occur when appraisals are abused.

If you’re in a position to dispose of appraisals, then do it.

If you’re not, then change it anyway.

As the former general of the United States Army and Secretary of State once said, “It’s easier to ask forgiveness, than it is to ask permission”.

You can use the articles in this series to make your point about why you did.

 

 

In the next article, we’ll look at the appraisals themselves.  If you want to read it ahead of time email your request here