A recent Singapore Institute of Directors survey found the numbers of companies committed to carrying out performance appraisals has significantly increased in recent years. These results bode well for employers and employees alike, because performance appraisals are meant to narrow the gap between expectations and accomplishments. They also signify a more positive stance towards communication in organisations.
Or do they? Performance appraisals are meant to produce several useful outcomes: clearer indications of progress; enhanced feedback opportunities; and more precise roadmaps of improvements yet to be made. Staff can gain a better understanding of their roles and potential within the organisation, while employers can establish and reinforce performance standards. However, these results only happen when performance management exercises are carried out with care, enthusiasm and thought.
HR experts say employee appraisals, while routinely carried out in many organisations, do not always reach their intended goals. With long lists of unresolved management issues on the agenda, employers often see appraisals as just another task. The problem with this mentality is that it devalues the process, and employees receive the message that their progress is not being taken seriously.
Performance management has a crucial role to play in avoiding a myriad of employee challenges. Peter Siah, Assistant Director of Performance Management, Singapore General Hospital, says a key aspect of performance management is its position in the general career development timeline.
He warns that appraisals should never precede strategy development. “Only when you know the overall game plan and what the deliverables are can you then decide targets and manage the performance and contributions of staff,” he says. Siah also warns against rushing to define performance metrics, a mistake which results in misalignment of goals and actual outcomes.
HR must also carefully consider where performance management should be situated on the agenda. To rush the process will have adverse effects on employees. On the other hand, brushing aside or downplaying this high-priority task will strain the all important exchange of ideas between employees and employer.
Once communication begins to collapse, other downsides are inevitable. Trust dissipates; a cohesive cultural identity is more difficult to form; career directions and benchmarks become hazy for employees and employers alike. Siah says this will ultimately result in costly increases in turnover. “Talented staff are very mobile and there will be no shortage of suitors should they decide to look elsewhere to develop their aspirations.” Hence, it is up to the organisation to establish a robust and dynamic appraisals system, he says.
Face to face
The boundary between an excellent organisation and a merely functioning one can be likened to – and partially attributed to – the difference between effective and non-effective appraisals systems. Siah places the systems into two basic categories according to the employers’ attitude towards motivating staff: “performance management seen as housekeeping” versus “performance management to reward and recognise efforts to achieve shared goals and outcomes”.
NC Prakash, Senior Manager, Organisation Development, Rohde & Schwarz, is direct with his criticism of the way performance management is often handled today. He sees a number of fundamental flaws which lead to a gap between expectations and results. He says the current system of providing feedback at fixed intervals is detrimental, especially when one considers that performance goes unacknowledged until these designated review sessions.
Performance also deserves a wider definition on both ends of the spectrum. Whether it is poor performance or excellent, it should be acknowledged immediately. “I’d encourage frequent feedback,” says Prakash. He keeps a handy adage in mind for both types of performers. “When you see it, say it (for a job well done); and when you see it, say it privately (for a less than ideal performance).”
Certain industries see immediate benefits from instant feedback. Prakash has observed firsthand the impact instant feedback makes in the retail and service sectors. “It takes only a few short minutes to reflect on a transaction to recognise how it was well done and what could have been better,” he says. “Then people go back to the next transaction re-aligned or energised.”
Although sales and retail stand as clear-cut examples, organisations across industries can apply the same principles. Yoosuf Moiz, Head of Learning and Development, AET Tankers, is an advocate of regular feedback. He encourages HR professionals to avoid putting off appraisals. “A delay will negatively impact productivity, whereas improving people improves the bottom line and productivity,” he says.
The method of performance appraisals should also be reconsidered. Employers often believe that a paper-based report suffices; but actual conversations are also a very important factor. “Dialogue, dialogue and more dialogue,” states Siah’s personal appraisals mantra.
“Effective performance management can only occur through face-to-face discussions.”
Moiz says there is always room for improvement – even employers who feel they are doing everything right can learn to do even better. An all-round approach requires consideration of both tangible “deliverables” and the “softer” factors. “Organisations should be running a tighter ship,” Moiz reminds employers.
Appraising the appraisers
As HR professionals weigh in on the flaws in the current appraisal models, the inevitable question arises: who’s to blame? That is to say, who is responsible for mending the leaks in a performance management system?
Moiz believes that in order for performance management to be seen as a necessity, it must be fronted and supported by senior management and the CEO. Siah agrees; saying it is a misconception that the onus is often solely on the HR department. “Performance management is everyone’s task, from managers to supervisors to staff,” he says. While HR can facilitate the process, everyone needs to be a driver.
Still, most HR professionals admit that the task often gets passed back and forth between themselves and the management. That’s because appraisals are seen as a challenging task. When done right, they need to be detailed, accurate and justified. They require careful attention and a great deal of tact; particularly when they involve telling an employee they are not meeting expectations.
“I know of very few managers who are absolutely comfortable in an appraisal situation,” Prakash says. Nobody wants to face conflicts or the diminished morale that may result from an ineffective performance management process. Those who feel forced into being appraisers may consequently take the easy route, abandoning honesty and avoiding giving valuable feedback. This ends up defeating the intentions of the process.
Moiz believes managers should be educated and trained to refine their understanding of HR capabilities in this context. “Managers need to know that management is not just about the task, but the ‘how’ behind it,” he asserts. Training does not have to be specific to the appraisers, however. Staff can also learn the right type of language to express their concerns about expectations.
From a more long-term point of view, there also needs to be a sense of collaboration in the organisation, one which is routinely reinforced to ensure fewer surprises and greater improvements. A transparent workplace environment may take time to develop, but certain measures give organisations a head start in the right direction. At Rohde & Schwarz, HR has recently launched a weekly e-zine, focused solely on coaching and leadership. It serves as a reminder to managers to inspire and have positive conversations with their team members on a regular basis.
Key players
Everybody plays a part in the performance management process. Peter Siah, Assistant Director of Performance Management, Singapore General Hospital, details each role:
+ Staff should monitor their own performance and seek to value-add
+ Department managers must guide the process according to desired outcomes
+ Supervisors should take responsibility to bridge the gap between organisational goals, management expectations, department objectives and staff needs
+ Corporate planning must work closely with HR to develop a strategy-focused performance management system
+ HR needs to focus with the organisation development department to ensure organisational buy-in, change management, and effective staff deployment