Scrap Performance Appraisals - Part 1

A friend of mine, who is a HR department head, challenged me to come up with the alternative to performance appraisal systems. She, like many of you, has heard me say time and again that they are a waste of time and most often counter productive. And boy are they costly!!!
Cha-ching goes the corporate cash register (the song "Money" stuck in my head).

She asked me to create the alternative so that her company could be the pilot site. That’s an intriguing thought, but not something I had on my nearterm project list.

But it’s an intriguing idea.......not on my list.......but interesting......

So here is what I am going to do. I have decided to dedicate this week to being

Escape Performance Appraisal Week at Management Craft!

Each day this week, I will share another aspect of this issue or build on ideas. I would love it if you chimed in and shared your thoughts and questions along the way. I am not going to publish the agenda for the week because I do not know where I am going to go with this, I just know it is too big for one blog post. I am employing Evelyn’s “write into it” approach, focusing on open thinking and incorporating your thoughts.

The topic of performance appraisals is interwoven with the topics of motivation, incentives, competition, and rewards. So our conversation this week might venture into some or all of these areas.

Today I am going to start by doing a bit of an information dump that sets up the situation:

Here are a couple articles from Alfie Kohn, author of Punished By Rewards, a book on my must read list for managers. For those of you who are parents, Kohn is a must read and he has lots of stuff focused on education.

Challenging Behaviorist Dogma: Myths About Money and Motivation

Another Look at Workplace Incentives

Here is a review of the book, Abolishing Performance Appraisals. I agree with Ian that this is a book all HR folks should have and read. Middle and senior managers should read this too!

And here is an online article I found by Fred Nichols called,

Don't Redesign Your Company's Performance Appraisal System, Scrap It! A Look at the Costs and Benefits of Performance Appraisal Systems. I do not know Fred, but there are some interesting points in this article.

And of course, Performance Appraisals were #3 on Deming’s list of 7 Deadly Diseases getting in the way of our pursuit for quality.

If you are expecting an objective journalistic article about the pros and cons of performance appraisals here, you have come to the wrong place. I don't think that would be a good use of time or space. Most people in their heart know that appraisals don't work, but the question is always what to do instead. The purpose of this series is to explore the “scrap appraisals” point of view and the potential alternatives. All week, I will go deep into this one topic.

That said, I welcome comments from any point of view!

Comments

[Bren]

Mmmmm....good stuff, Lisa! Can't wait to read more (and read the comments/trackbacks).

You've got me thinking, too. I've never been a big fan either, but how do you circumvent the larger corporate policy which is unlikely to change? I can feel a post bubbling up... :-)

[Lisa Haneberg]

Bren - you raise an interesting question, but I have an observation. While it may ultimately be true that the larger organization won't change and that circumvention is necessary, you might also want to challenge your assumptions and determine whether these beliefs are serving you well. I understand that you work in one of the most change averse places on the face of the earth - higher education (ironic, isn't it?).

Either way, it's a good question, so let's get into it!

[Dick Richards]

I love Alfie Kohn's work, and Tom Coens and I once shared presentation time at a Deming Institute annual conference. I nodded my head a lot when Tom spoke.

I do have an answer for "what to do instead" -- insure that all people in the organization are engaged in work which allows them to bring their genius to a purpose that has meaning to them.

Sounds simple and obvious but, compared to performance appraisal, it requires a very different mind-set, very different skills, and a high level of trust in the human spirit.

[Tom Ramatowski]

My company is doing a "Performance Appraisal Calibration Process". It is very depressing for everyone and seems to have little value as far as improving performance. In fact it will probably have the opposite effect for some time. Can you comment on this?

[Christopher D. Lee]

Colleagues:

After years of pondering and research, I have come up with an innovative method of performance management; a better method of working with people. My new book, Performance Conversations: An alternative to appraisals is a 21st century approach to management. Let's change how organizations work with people. Performance appraisals are 20th century technology that never worked in the first place. I would love to hear what you think of my new book which is available at my website or at Amazon.com.

cdl

[Dick Grote]

Here's a strong vote in favor of performance appraisal.

I’ll fess up to an obvious fact: Most managers do hate conducting performance reviews. If they thought they could get away with it, they’d probably skip the whole annoyance completely. And lots of employees loathe them. So what?

In too many places, performance evaluations are sloppily done and not taken very seriously. A lot of supervisors would rather endure a root canal than write and deliver a performance review, particularly if there are some hard, cold truths that they can’t avoid discussing.

But in spite of all the problems and resistance, I‘m a solid believer in performance appraisal. I think performance appraisal is critically important for any organization that’s more sophisticated than a mom-and-pop store—or that wants to be.

As hard as performance appraisal may be—and done right, it is hard—I’m convinced that we do it because it’s an ethical obligation of leadership. Every person on the team wants the answers to two questions. First: What do you expect of me? Second: How am I doing at meeting your expectations? The performance-evaluation process answers those two questions. So why do we do performance appraisal? Because as leaders we have a moral obligation to do so.

And we also have an obligation to put the time into performance appraisal that it deserves. Goodness gracious! Managers don’t spend a tenth as many hours assessing and developing and appraising people as they spend in the restroom. But they’ve got the gall to whine about appraisal taking too much time. That’s nonsense.

So managers hate performance appraisal. Big deal. They also hate budgeting. Grow up, get over it, and start doing it right. You’re getting paid to be a leader — start earning your pay.

Dick Grote