Multi-Unit Franchisee Magazine Issue IV, 2015 | Page 68

People BY JULIE MORELAND

It’s Broken, Fix It!
How to improve performance reviews

P

eopleMatter recently hosted a
webinar with our partner and
performance management expert,
Chris Wright, founder and CEO
of Reliant, where he shared why today’s
performance review process is broken…
and how to fix it.
• Performance feedback is given infrequently or not at all. Let’s face it. The
annual review process is a dated model.
Everyone goes through the process, and
that information is used for promotions,
raises, bonuses, etc. The problem is that
your employees work all year long, but your
managers probably aren’t documenting the
great (and not-so-great) things their team
members do throughout the year. That
means there’s a lot of feedback employees
should get that never makes it to them, or
into their performance review. This is not
healthy for them, you, or your bottom line.
Lack of training, motivation, and/or investment in today’s review process means
there’s also an accountability problem. Many
managers aren’t delivering feedback to employees. Yes, they’re filling out the form
and checking the box that it’s complete, but
they’re not having those oh-so-important
one-on-one conversations. Nor are they
setting up employees with a development
plan to start improving.
• Companies do not measure the

right things. A lot of companies really
struggle to define the core competencies
they should measure. That typically leads
organizations down one of two paths: oversimplifying or over-complicating what they
measure. If they’re over-simplifying, they
may be using very high-level competencies
across all positions to measure a person’s efficiency, expertise, or ability—when, in fact,
they don’t relate to every person’s role. On
the other hand, some companies measure
competencies granularly, on the task level,
which can lead to an overly burdensome
and cumbersome process.
• Managers are focusing on the negative. Reviews these days tend to focus more
on what employees are doing wrong than on
what they’re doing right. That, my friends,
can be straight out demoralizing, causing
employees to shut down. If an employee
is doing something wrong, they should be
confronted and corrected on the spot and
in private, not dinged for it months later in
a performance review. There’s also the issue
of constructive feedback. Some companies
have not trained managers to deliver it in a
healthy way, while others deliver it but provide no development plans for improvement.
• “Forced distributions” have tainted
the process and lowered morale. If you
aren’t familiar with forced distributions,
this is something that came out of Gen-

INCREASE THE FREQUENCY OF FEEDBACK
• Review employees within 30 to 90 days of hire.
• Review performance when it happens; praise publicly, coach privately.
• Conduct targeted, simplified reviews more frequently (e.g., quarterly).
• Streamline review forms so they require no more time to do quarterly than annually.
• Make the process quick and convenient with mobile-friendly forms.
MEASURE THE RIGHT THINGS
• Eliminate ratings on behaviors/competencies irrelevant to an employee’s role.
• Place more emphasis on employee strengths.
• Focus less on past behaviors/actions and more on future behaviors and goals (“how” the goals will be
accomplished).
SIMPLIFY RATING SCALES
• Eliminate “forced distribution” approaches.
• Create four-point rating scales (rather than three or five). This forces the rater to lean toward a positive or
negative rating vs. an average/medium rating.
• Develop rating anchors that are positive and developmentally oriented.
• Include qualitative feedback with any behavioral rating to give employees a clear understanding of the rating.
USE THE RIGHT TECHNOLOGY
• Reduce time conducting and evaluating reviews.
• Ensure the process is efficient and easy to use.
• Analyze performance over multiple evaluations.

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eral Electric. The “rank-and-yank” model
typically allows managers to give out only
a certain number of high scores, meaning
some employees who are indeed high performers won’t make the cut. Those who end
up on the wrong side of the scale often end
up missing out on well-deserved raises—or
worse, losing their job. On top of that, critics argue that pitting people against their
peers cripples collaboration and creativity.
In addition, “rater bias” is prevalent with
forced distributions: because managers are
limited to how many they can rate as a “high
performer,” they tend to rate (and reward)
their favorites the highest.
• Companies are using software that
is overly complicated. The KISS principle
applies here. You have to arm your managers with the tools they need to complete
reviews quickly and easily. The solution
you choose should be built on three core
beliefs: 1) employees deserve meaningful
feedback about how they’re doing their job;
2) managers need actionable performance
data to make decisions; and 3) organizations should have solutions that are easy to
use and effective. If you use software that’s
overly complicated, your managers will not
be engaged in the process.
So why do them?
Employees crave feedback. In fact, a recent
GuideSpark survey found that 89 percent
of employees want frequent performance
feedback (especially Millennials), and they
want their manager to be direct when giving it. While some argue that managers
should scrap the review process entirely,
I couldn’t disagree more. It needs to be
transformed. How a person accomplishes
a goal is just as important as whether the
goal is accomplished! Without reviews, it’s
nearly impossible to identify potential leaders, provide the proper career progression
advice, and know where to apply additional
training resources.
Deloitte sums it up perfectly: “Done
poorly, performance management can not
only waste valuable time, but also have a
negative effect on engagement and retention. Done well, it can be one of the most
inspiring and developmental events in an
employee’s career, as well as drive performance and organization-wide results.”
Julie Moreland is senior vice
presi [