How to Quickly Improve Any Performance Appraisal System

Performance Reviews Need Help

In a recent survey conducted by Adobe, 88% of the survey participants indicated they were part of a performance appraisal process. This same study found that managers in these programs spent, on average, 17 hours per employee preparing for their performance reviews. Yet, these findings were overshadowed by the discovery that 59% indicated that performance reviews “do not have an impact on how they do their jobs;” instead, they called them a “needless HR requirement.”[i]

The Society for Human Resources Management (SHRM) has reported that 95% of employees are dissatisfied with their company’s performance appraisal process, and, according to SHRM, 90% of these employees do not believe their performance review process yields accurate information.[ii] Statistics like these might account for some of the reasons why companies like Adobe, GE, and The Gap have substantially revised or even eliminated their traditional performance appraisal systems altogether.[iii]

Scary statistics, however, do not justify eliminating performance appraisal programs. Employees want to know if they are succeeding; they want meaningful feedback. Bill George, a professor of leadership at the Harvard Business School, has suggested that, “[S]elf-awareness is the starting point of leadership.”[iv] Indeed, other researchers have commented that self-awareness may be more important to a leader’s success than formal business training.[v] It’s axiomatic that if one is self-aware, he or she can learn and improve. If one is closed-minded, however, development and growth will be blocked.

In a similar vein, our experience and research at DecisionWise confirm the following principles: (1) employees want meaningful feedback (with more being better than less); and (2) understanding others’ perceptions about one’s performance is critical to that person’s leadership potential, personal development, and good management practice.

How to Fix Your Process Quickly

For these reasons, we have two performance appraisal tools that are designed to augment and support an organization’s existing performance review process. We think of these tools as bolt-on solutions that do not disrupt current processes while providing more actionable data. Our first solution uses a multi-rater (a 360-degree) survey that measures performance competencies for employees at all levels within an organization. It is also designed to give insight into performance and potential because it contains survey items that also measure an employee’s likelihood for future success (i.e., their potential). Thus, the instrument offers two assessment in one.

Our second solution is focused on evaluative information for teams. Our survey system gathers performance data upon completion of individual, discreet projects. For example, an accounting firm might use this tool to evaluate how well each of its audit engagements went during the last 6 months.

With the rise of ad hoc and self-directed teams, employees are now working closely with others who may not be linked together in the organization’s hierarchy or performance review process. Our tool gathers feedback from team members, and feedback can be gathered immediately after a project closes so that memories and suggestions for improvement do not fade with time.

Again, these tools are not designed to replace an organization’s current performance appraisal process or its talent review methods. Instead, our firm is looking to help practitioners with easy-to-use solutions that gather cleaner and more meaningful data to help them in their talent management efforts.

Why Our Solutions Work

A standard performance appraisal process is designed to help an individual employee and their manager understand two important things: (1) how well is an employee aligned to the organization’s objectives, culture, and strategy (alignment); and (2) to what extent are an individual’s personal efforts contributing towards team and organization success (accomplishment).

In addition to understanding these two questions of alignment and accomplishment, our instrument, as noted, is designed to evaluate potential. Some research has suggested that understanding your employees’ potential may be more important than simply identifying a current slate of strong performers.[vi] For this reason, we show both datapoints at the same time.

iPad With Data in a Graph Banner

 

Typical performance review programs are built around processes that range from evaluations based on business metrics (e.g., hitting sales goals) to narrative essays that offer in-depth detail about a person’s strengths and weaknesses. Here is a sampling of some of the more common performance management methods:

  • Manager’s report and assessment;
  • Ranking systems (everyone is given a ranking);
  • Behaviorally anchored rating scales;
  • Critical incident methods (something happens, and everyone takes time to document how performance could have been improved);
  • Continuous feedback and coaching systems;
  • Job responsibilities review; or
  • Self-assessments.

In addition to some of these more common methods, there are many more performance appraisal programs used around the world, as organizations customize and develop programs to meet their specific needs.

Of the myriad of options available, employees appear to prefer multi-rater feedback.[vii] A standard multi-rater feedback program solicits feedback and evaluative information from a variety of sources that surround the focal person (i.e., the participant). Feedback is solicited from one’s supervisor, from one’s peers and direct reports, and from other applicable categories. You may be most familiar with multi-rater programs in the context of 360-degree feedback surveys.

Some practitioners avoid a multi-rater performance process, believing it is more difficult to administer and track because it relies on input from a lot of people. This fear was probably justified in the past, but we designed our surveys and technology to address many of these historical problems. In addition, a multi-rater performance process is a net positive because it solves many of the problems associated with other appraisal programs.

For example, because multiple raters are surveyed, the process is sounder from a legal perspective, as it relies on variety of observations instead of just one or two. Employees also appreciate the fact that feedback is not contingent on just one or two people. Evaluations are received from a variety of sources including peers and others that might even have a rooting interest in favor of the employee. Moreover, a multi-rater system, by its nature, means evaluation criteria remain consistent from one rater set to another. In addition, the instrument focuses on well-defined competencies instead of relying on personal evaluations that may be subject to biases. External rater groups may even be invited to join the process, which extends the reach of the program to potential customers, vendors, etc.

On the backend, users are provided a robust analytics tool, which means HR leaders and analysts will be able to cut and slice their data and discover hidden pockets where things are going well or poorly. Our survey instruments are designed to not only assess performance but also potential, and our analytics tool can be used to develop nine-boxes. Nine-boxes are useful data visualizations that helps talent management professionals and others involved in succession planning quickly identify and track their high-performing employees.

Our team-focused solution addresses a different concern. Self-directed teams are emerging as useful tool for organizations to solve tricky problems that require innovation and cross-functional expertise.[viii] In addition, other industries rely heavily on ad hoc teams (teams created for a specific project and then they disband), such as heavy construction, accounting, marketing, etc. Many companies would like to evaluate these teams in order to conduct people analytics (e.g., What makes a good team? What characteristics help or hinder the process, etc.?).

While it is common for teams to conduct a debrief session after a project has been completed, these sessions often lack any hard data from which to conduct the debrief. Moreover, in-person debriefs do not yield data that can be aggregated to show larger trends or to make predictive analyses. Our team solution launches a quick evaluative survey (ideally taken on mobile devices) soon after a project closes. This tool is supported by administrative features to help automate and organize the process, and its analytics tool, as suggested, helps the user explore and analyze data for immediate insights along with laying the groundwork for potential predictive analyses.

Conclusion

For practitioners conducting talent reviews, these two solutions are an easy way to gather more actionable data from which to make decisions, to tailor learning programs, or develop succession plans. These tools also help organize and automate the process without disrupting current programs and systems.

Employees want to improve, and they want feedback to help them. The key to unlocking your employees’ potential is meaningful data that points the way for managers and employees to improve on strengths and narrow performance gaps. While some experts cheerfully proclaim the performance review is dead, the reality is that in a modern, data-driven workplace, and when dealing with data-savvy employees, the performance review isn’t ready to die. It’s too valuable a data source and management tool. However, it needs to be re-imagined and enhanced with technology, systems, and data collection that make the appraisal process better for both the individual and the organization.

 

Employee Engagement Survey

 


[i] Adobe, Performance Reviews Get a Failing Grade, January 11, 2017 (retrievable from LinkedIn’s SlideShare.net).
[ii] Thomas Koulopoulos, Performance Reviews are Dead. Here’s What You Should Do Instead, Inc.com, February 25, 2018.
[iii] Ibid.
[iv] Hougaard, Carter, Afton, Self-Awareness Can Help Leaders More Than an MBA Can, Harvard Business Review, January 12, 2018.
[v] Ibid.
[vi] CEB, The HR Guide to Identifying High-Potentials, CEB/SHL Talent Measurement White Paper, 2014.
[vii] R. Wayne Dean Mondy, Chapter 8, Performance Management and Appraisal, Human Resource Management, 12th Edition, P. 244, Pearson, 2012.
[viii] Chuck Blakeman, Why Self-Managed Teams Are the Future of Business, Inc.com, November 25, 2014.

Podcast: Organizational Network Analysis – Tapping Into Your Hidden Influencers

Hidden influencers are those with personal power, but not necessarily positional power. Other employees are drawn to them due to their expertise, influence, and role modeling. These informal influencers are crucial for engagement, information flow, decision-making, best practice transfer, institutional knowledge, mentoring, and retention.

Correctly identifying and engaging hidden influencers is one of the greatest levers leaders have to increase organization-wide engagement. Learn how to do it in this insightful conversation between Beth Wilkins, Ph. D., Christian Nielson, MBA, and host Justin Warner.

 


Resources:

Video: 5 Personal Benefits of Employee Engagement

It’s apparent that employee engagement increases the organization’s bottom line and performance, but what about the individual?

As an employee, why would l care about being more engaged if it only means I have to work harder and the company reaps all of the rewards?

View the Infographic



Employee Engagement Survey Sample Download

Webinar: Organizational Network Analysis

Hidden influencers are those with personal power, but not necessarily positional power. Other employees are drawn to them due to their expertise, influence, and role modeling. These informal influencers are crucial for engagement, information flow, decision-making, best practice transfer, institutional knowledge, mentoring, and retention.

Correctly identifying and engaging hidden influencers is one of the greatest levers leaders have to increase organization-wide engagement. Learn how to do it in this insightful webinar.

Watch Now:

Podcast: Meet The Consultant – Dan Deka, MBA

In this episode, we sit down with DecisionWise Senior Consultant and Executive Coach, Dan Deka, MBA. We discuss his career and his approach towards engagement, consulting, and leadership.

Dan is a Senior Consultant and Executive Coach at DecisionWise. He is responsible for partnering with individuals, teams, and organizations to help them design experiences that illuminate leadership potential and improve employee engagement.

Dan’s love for inspired design evolved from art and film to business and human relations as he pursued and received his B.A. from Loyola Marymount University and his M.B.A. from San Diego State University. Dan is also an ICF Certified Executive Coach from Georgetown University.

His 20 year career in Human Resources spans the field from employee relations, performance management, organizational design, change management, and employee engagement to leadership and executive development. These experiences have been cultivated from positions with Packard Bell, Wells Fargo, Capital One, RealNetworks, Micron Technologies, and most recently as the Manager of Organizational Development for a global non-profit.

Dan is a surfer from Hawaii and enjoys “riding the wave” with his team, clients and family.

Podcast: Motivating Others

In this episode, we discuss the idea of motivating others. We tackle questions like:

  • What do you do to get people excited about their work?
  • Are you a source of energy for your team?
  • What tools are available to help you motivate other people?

Learn the answers to these questions and more in this insightful conversation between DecisionWise consultants, Dan Deka and Charles Rogel.


Additional Resources:

4 Reasons Why Employee Retention Is a Challenge in 2019

Employee Retention

“Back in the day we used to walk to work, in the snow, uphill, both ways!” Yeah, we’ve all heard it before. The older generation in the workforce had it much rougher than we do today, right? For the most part I would say that’s pretty much true. I look at my father who started his career in the early-70s in a steel mill and maintained the same job, in the same small town, most of his life. Like my father, it was fairly common for workers in the 20th century to work for the same company most of their careers according to a Stanford Center on Longevity study. Employee turnover wasn’t as big of an issue.

Download Employee Value Proposition survey sample and report.

Today the average worker’s tenure is just 4.4 years, according to data from the U.S. Bureau of Labor Statistics with expected tenure of the workforce’s youngest employees at about half that. The average cost of replacing an employee amounts to just over 20 percent of the person’s annual salary according to the Center for American Progress. That can mean millions of dollars for some organizations. So why does employee retention seem to be getting worse?

Here are four reasons why employee retention is becoming more challenging

1. Strong Economy

Employee Retention

The US economy is hot, and isn’t showing signs of cooling off. That’s a good thing right? Unless you’re trying to hire and retain good talent. The economy is growing and the CBO expects GDP growth of 2.3% in 2019. In May of 2018, job openings exceeded hires. There are more jobs available than can be currently filled, according to the US Department of Labor. Quit rates are also increasing accordingly as workers are finding better opportunities in a better economy. With unemployment rates falling and job opportunities increasing, the power is shifting out of the hands of the employer and into the hands of the employee. Organizations can no longer assume that people NEED them. Top talent will go wherever they choose and with whomever offers them the best fit culturally and financially.

2. Changing Workforce

Millennials, it’s always about those darned Millennials, right? Millennials (adults ages 18 to 34) recently became the largest generation in US Workforce.

Ninety-one percent of Millennials expect to stay in a job for less than three years, according to the Future Workplace “Multiple Generations @ Work” survey. Younger workers historically have lower tenure rates and are more willing to bounce from job to job. Most younger workers are more mobile with less obligations holding them down. Many aren’t married, don’t have kids, and don’t own a house yet. This frees them up to try new things and live in new places. They are also looking for growth opportunities early in their careers to set them up for success in the future. Younger workers also tend to job-hop more than older workers as a means to quicker career advancement. Now that they comprise the largest segment of the workforce, expect to see the overall tenure rate to fall.

3. Technology

smartphone user

Technology makes it easier for people to instantly find and apply for new job opportunities. A few decades ago workers turned to the want ads in newspapers to find jobs. Hot jobs included titles like typists, switchboard operators, mimeograph repair technicians (what?), keypunchers (Doesn’t everyone punch keys nowadays?), and elevator operators. Newspapers even had separate job listings for men and women. Today’s available jobs sound more like Web Developer, Content Marketing Manager, or Search Engine Optimization Specialist. Job seekers no longer turn to newspapers. They turn to the Internet and sites like Indeed, Monster, Glassdoor, and LinkedIn. Qualified job seekers don’t even have to seek nowadays. They can sit back and receive email or text alerts for available jobs that might fit their skill set or interests. Madness I tell you! Employees can browse job sites directly on their smartphones during lunch hour, in the break room, bathroom, or at their desks.

4. Side Incomes

Making money in your pajamas is the true American Dream, right? Non-traditional side incomes are ending the nine to five job where employees once made the slow climb in a company as the once accepted career path. Freelancing and self-employment are ways that modern-day workers are pulling in extra money or even a creating a full-time living. People can now start a business at the drop of a hat and at little cost. Bloggers, YouTubers, Esty’preneurs, and more are setting up shop and producing content online pulling in viewers, customers, and advertisers galore.  According to Craftcount, the successful Etsy shop, ThinkPinkBows, an online shop selling baby hair and clothes accessories, brings in $2 million in sales. Many people are waiting to leave the traditional workforce as soon as their online side-business can replace their income. It’s the American Dream served up on your personal computer in your very own living room.

What can organizations do to improve employee retention?

team employee experience

Now, more than ever, organizations need to focus on the overall Employee Experience. The Employee Experience consists of all of the experiences an employee has, that become pivot points or moments of truth. These experiences shape an employee’s beliefs about the company, its leaders, the brand, and the employee’s overall success in the organization. Consider these questions: 

  • Does your hiring experience excite applicants or does it require them to jump through a series of “hoops” where they feel lucky if they receive any communication from HR.
  • When new employees are on-boarded, do they feel prepared to be successful or are they thrown into the pool to learn how to swim?
  • Are employees excited and energized as a result of performance reviews or do they dread the process?
  • Can your employees become engaged by their work and the mission and values of your organization or are they working for the weekend?
  • Are you using people analytics to understand how your Employee Experience is impacting your business metrics?

Start by finding out how these experiences are perceived by your employees and take the steps needed to improve employee turnover. Become forward thinking. Similar to those in academia who embraced mobile devices and integrated them into the learning process rather than banning devices.  The current job market is in a similar situation. What got you here, will not get you there.

Employee Engagement Survey

Which Employee Engagement Survey Method is Best?

Working on laptop with team.

Employee Engagement Scare Tactics of 2018

Employee Engagement Scare TacticWhich employee engagement survey method is best for measuring employee feedback? The simple answer is, it depends. It’s rare these days to pick up an HR publication or attend a conference that isn’t at least partially dedicated to employee engagement. Many of these articles or events begin with alarming—although not always accurate—quotes like, “over three-fourths of your employees are actively disengaged, and unlikely to be making a positive contribution to the organization.” Scary.

While most of these statistics are hyperbole (i.e., do you really think an organization can function if seven out of eight employees are either actively sabotaging your company or darting for the exits?), there appears to be little challenge to the idea that an organization’s success is directly tied to the employee experience (EX). Engaged employees are far more likely to deliver results than disengaged employees. Also, few dispute the notion that keeping your finger on the pulse of the organization is critical to business success. The question is no longer one of if an organization should gather feedback but, rather, how that feedback should be gathered.

Download the Guide: Choosing the Best Method to Measure Employee Engagement

How Are Organizations Measuring Employee Engagement?

For the past two years, consulting firm DecisionWise has surveyed HR practitioners to understand just how organizations go about measuring engagement and the employee experience. Based on responses from more than 200 companies across the globe (representing over 1.2 million employees), two-thirds of organizations (67%) claim to formally measure employee engagement on a regular basis and have specific initiatives in place to address their findings. Interestingly, over the past several years, the question of “how often and how should we solicit employee feedback?” seems to have replaced the previous question of “should we solicit employee feedback?” Much of this results from a new wave of technology that allows organizations to gather real-time feedback, as well as to continue collecting more strategic feedback through their traditional annual employee engagement surveys.

Busy Office - Employee Engagement

Which Employee Engagement Survey Method Is Best?

There has been an increased push in 2018 and over the past several years to downplay the role of the traditional annual employee engagement survey, with some recommending instead that feedback be gathered more frequently—even as often as once a day or in “real time.” Further, in a push fueled primarily by survey software providers, rather than HR professionals, some organizations are enticed by technology that allows them to both solicit and provide feedback at any time of the day or night, in real time. On the other end of the spectrum, many organizations still prefer a more traditional approach to surveying their employees, opting instead for an annual or semi-annual employee engagement survey. However, while most organizations won’t be abandoning the annual employee survey anytime soon, most agree that an annual check-in with their employees is not enough. It’s simply too infrequent to understand the employee experience (EX).

So, which of these employee engagement survey methods is the most effective? More importantly, which of these employee survey methodologies provides the best information upon which to make critical employee and strategic decisions?

As with most employee-related questions, the answer is, “it all depends.” While one solution or a group of solutions won’t be right for every organization, it is important to understand the options available before settling on a particular solution or set of solutions to use in your organization.

Two Primary Employee Engagement Survey Variables: Scope and FrequencyFour employee survey types

Although numerous variations are currently available, employee engagement survey solutions generally vary by two main factors:

1. Scope – Scope refers to the magnitude and depth of the survey (number of employees surveyed, number and depth of survey questions or items, level of reporting detail and analysis, how the survey results will be used, etc.).

2. Frequency Frequency is simply how often the employee engagement survey will be conducted (annually, quarterly, weekly, always-on, etc.).

These two main factors, scope and frequency, create four primary types of employee engagement survey options. Remember, numerous variations of these four employee engagement survey methods exist. However, they can generally be broken down into the following, ordered from most frequent to least frequent in administration:

1. Always-on Employee Engagement Surveys

Always-on surveys or continuous feedback technology provides “real-time feedback” that can be quickly deployed and reviewed. These employee surveys are typically used in two ways:
1. To gather ongoing employee feedback to the company and/or for employee performance feedback (including reward and recognition). Always-on surveys generally ignore organizational structure, meaning that due to anonymity, survey results don’t typically roll up under departments, functions, or specific managers. When used for company feedback, these platforms act as a modern-day variation on the old suggestion box. When used for employee performance purposes, real-time feedback for colleagues, bosses, subordinates, and others can be provided with just a few taps of the screen. Employee engagement surveys can address guided questions, which are to be evaluated on a Likert scale (“How likely would you be to recommend XYZ Company to friends, based on today’s experience?”), specific topics (“Have you had a performance conversation with your manager sometime in the past week?), or even as general open-ended comments (“What would you like us to know about your experience?”).
2. Another way that always-on employee engagement surveys are often used is, the unstructured feedback option: The ability to comment on anything, at any time (a modern take on yesteryear’s suggestion box).

Learn more about Always-on Surveys including the pros and cons.

2. Employee Spot Surveys

Similar to an always-on employee engagement survey, spot surveys are also generally quick to deploy, address sentiment rather than engagement, and do not require (or allow for) in-depth analysis. They are often designed to address specific events (a conference), areas (benefits), or issues (a recent downsizing). Employee spot surveys are rolled out to measure current hot topics pertinent to the organization, such as gathering input about a change in benefits or soliciting opinions from employees. For this reason, industrial psychologists group employee spot surveys under the “polling and opinion” category. Employee spot surveys are fairly simple to launch or to roll out, and many survey software platforms allow managers or other users to design and administer their own surveys. In this case, these platforms are purchased as applications that may reside on local desktops or are made available through an online application software-as-a-service (SaaS)-licensed model (the latter has overtaken the former as far as popularity). Other systems are geared more to administration by human resources personnel, allowing them to get a feel for the thoughts or opinions of employees.

Learn more about Employee Spot Surveys including the pros and cons.

3. Employee Engagement Pulse Surveys

Called “pulse surveys” because they “take the pulse” of an organization or group, these types of surveys are helpful tools in gauging progress, warning of potential dangers, understanding trends in the employee experience, and promoting action. Pulse surveys share many similarities with spot surveys, but with two key differentiators:
1. They occur at regular or planned intervals, or with planned groups, and generally involve large pockets of the organization’s population (if not all employees).
2. Employee engagement pulse surveys are often intentional follow-ups or supplements to other employee surveys. Pulses surveys sometimes ride the coattails of annual employee engagement anchor surveys or other employee pulse surveys, in that they serve as a great way to drill down for more specific information or follow up on areas that need to be addressed.

Learn More About Employee Engagement Pulse Surveys Including the Pros and Cons.DecisionWise Employee Engagement Survey on Mobile Phone

4. Employee Engagement Annual Surveys (Anchor)

When most companies talk about their annual employee engagement survey, they are referring to an “anchor survey.” These employee surveys have been used for decades. Our research found that 89% of organizations use annual employee anchor surveys (in some form or another) and, of those, only 6% said they would be moving away from anchor surveys in the foreseeable future. Despite what some software providers might advertise, this type of employee engagement survey is likely to be a part of gathering feedback for most organizations for years to come. Why? Most organizations simply find that, when implemented correctly, they work.

Download a Sample Employee Engagement Anchor Survey

Employee engagement anchor surveys carry many different names: employee engagement survey, employee survey, well-being survey, climate survey, employee satisfaction survey, employee experience survey, culture survey, and so on. While there are actually differences between each of these types of employee anchor surveys, that’s a discussion for another day. However, they all fall under the category industrial/organizational psychology refers to as “anchor surveys,” due to the fact that they presumably form the base around which other employee surveys operate.

Learn More About Annual Employee Engagement Surveys Including the Pros and Cons.

While various employee engagement survey providers may use different names and features, these four survey types listed above generally cover the range of variations and options. So, which employee engagement survey method is best? As stated before, it depends on your goals, scope, and frequency.

Call to Action - Best Practice Guide to Choosing Best Method to Measure Employee Engagement