Performance Appraisal Pitfalls to Avoid
The purpose of employee performance appraisals is not to sit in judgment, place blame or assign a score to employees. Their purpose is to help employees develop new skills and improve existing skills to increase productivity, improve customer service, retain employees by giving them new opportunities and, ultimately, to contribute to the success of the business.
Unfortunately, there are a number of common pitfalls that managers need to avoid if the performance appraisal process is to be a useful management tool and not an ordeal that everyone dreads.
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Halo Effect
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The halo effect is a form of bias based on perception. If managers perceive employees as outstanding in one area of performance, they sometimes apply that perception to other areas of employees' performance. Its opposite, the "pitchfork effect," works in the same way; a manager's negative perception of one aspect of an employee's performance is applied to all other aspects of the person's performance.
Central Tendency Error
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Some managers evaluate all their employees as average and avoid high and low ratings. This is the central tendency error, and it occurs when managers play it safe and don't want to have to justify their ratings with human resources and higher management. It also occurs when the manager lacks knowledge about the employee being evaluated or the specifics of the person's job.
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Leniency/Severity Effect
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The leniency or severity effect occurs when managers rate all their employees high or low and none in the middle. Leniency is more common and occurs because managers are unwilling or unable to give negative feedback or do not want to hurt employees' feeling.
Recency Bias
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If managers have not kept records on employee performance -- both problems and successes -- the recency effect is likely to occur in the performance appraisal process. The successes and problems an employee had immediately preceding the performance evaluation take priority in the appraisal. Similarly, the unforgettable effect can drive a performance appraisal. In this effect, an employee's most memorable or extraordinary accomplishment or mistake takes priority over the employee's daily work in the appraisal.
Other Appraisal Pitfalls
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There are several other common pitfalls in the performance appraisal process. In contrast error, managers compare workers doing the same job with one another rather than evaluating each person on objective performance standards. Manager bias or preference occurs when employees are rated based on how similar or different they are compared to the manager in areas such as personality, interpersonal skills and style.
Avoid Performance Appraisal Pitfalls
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Managers can avoid these and other pitfalls of the performance appraisal process by managing employee performance throughout the year and not just at performance review time. Provide each employee an up-to-date job description that includes the essential tasks. Meet with each employee on a regular basis to discuss performance, provide feedback and offer support. Keep a performance log for each employee, documenting both success and problems, including the date, a description of the situation and who was involved. Evaluate each employee objectively rather than subjectively, using performance standards based on the essential tasks of the person's job description and supported by facts documented in the employee performance log.
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References
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