Regular performance measurements can improve productivity, boost morale and provide the all-important "face time" with managers that employees want and need for job satisfaction. No feedback gives poor performers the false impression that they are doing a good job. Managers reluctant to give honest evaluations not only do a disservice to employees but also may be setting up the company for a lawsuit if an employee is let go for poor performance. Choosing the right performance report method can boost the return on investment (ROI) of people, time and money.
Traditional Performance Reports
Experienced human resource directors have found that many employees value the time sitting with a manager reviewing their performance as much as the possibility of a pay increase. Traditionally, an employee sits down with his boss while she goes over his ratings on performance categories such as job knowledge, skill level, ability to work with others and attendance. This one-on-one dialogue affords a private setting for discussion, questions and answers and future goal setting. Over the years, employees have been given the opportunity to rate themselves using the same criteria. As a result, both parties share their observations in the review meeting.
With the evolution of quality management and teams, this type of performance report has become a shared responsibility, with the opportunity to come to consensus on the final outcome. Whether the ratings are by percentage, number or written comments, completing the exercise on schedule means a lot to the employee and helps build good working relationships.
Management by Objective (MBO)
In an MBO performance report, mutually-determined objectives for a manager become the criteria for evaluation. Unlike hourly employees who typically work within a clearly defined structure or process, managers are tasked with projects or areas of responsibility, such as accounting or customer service, which have clearly defined outcomes but leave room for methodology. Since "how" the work gets done is in some measure up to the manager, there is more room for interpretation of the objectives themselves and the effectiveness of the results.
The success of this method depends on how clearly the objectives are defined, the manager's comfort level with a measure of ambiguity and the continued communication between manager and her supervisor prior to the actual performance report. Besides the objectives themselves, such things as effective decision-making, understanding of a process, attention to detail and ability to inspire a team to work together can be assessed through this process.
360 Degree Feedback
While traditional and MBO reports give two viewpoints on performance, the 360 degree feedback process solicits input from managers, peers, the subject's direct reports, team members and clients. Because their effectiveness relies heavily on anonymity of the reviewers, this type of performance report is more costly, time consuming and is best done by an outside company (it can even be done online).
When the reviewers feel comfortable and protected, their honest feedback can be invaluable when validated by similar responses from other members of the review team. The overall feedback becomes more objective and more likely to be accepted and acted upon. Often, the higher the level of the employee, the less likely she is to take constructive feedback. When a message comes back loud and clear from not only a direct manager but also peers, clients and staff, it can carry a lot of weight and is difficult to ignore. Senior managers, executive committee members, rising stars and the organization itself can use this type of feedback for staffing and succession planning.