Try this out in your organisation some time. Ask the employees how many of them would rate their performance and skills in the 90th percentile or more. Statistically speaking, that should be no more than ten percent of the employees who have been asked the question. But real life is very different from this. A very large percentage will see themselves as members of the hallowed group.

Now imagine the plight of the manager who has to appraise the group that has an inflated view of their skills, and get them grounded.

It’s not just in the workplace that we judge ourselves generously. When the weighing scale tells us that our weight is more than what it ought to be, we blame the scale. When a psychometric instrument tells us something about ourselves that we are uncomfortable with, a person will question the design of the instrument.

In an assessment centre feedback, leaders agree vehemently with the strengths that have been identified. When it comes to the developmental gaps, they will question the sanity of the psychologist who designed it.

Performance appraisals are, perhaps, the most controversial of all processes. Not only is it a time when someone sits in judgement about the quality of your work, but eventually, reward and recognition gets linked to it, and so does the development effort that companies are willing to invest. No one likes to be left out of the room when money is being counted. The goals that we set are also meant to inspire and motivate action. So the foundation for good performance appraisals lies in setting the right number of goals (no more than four in my opinion).

BEAR IN MIND THREE FACTORS WHEN YOU SET GOALS:

1) Difficult goals tend to motivate people more than easy goals
2) Ensure that critical goals are aligned with what we are naturally inspired to do
3) Too many goals are as ineffective as having too few goals. Four is a good number of goals to have so that each goal can get 25% of effort

Performance appraisal is good feedback for the boss

The ability of a manager to set goals that are meaningful is a skill. More than that, the ability to reach a performance appraisal discussion where nothing comes as a surprise to the appraiser is a good measure of how effective the boss has been. If the appraisal discussion generates more heat than light, then it may indicate that the appraiser has not tracked feedback throughout the year, and shared it with the appraisee.

Imagine a scenario when someone discovers after a year that his or her manager always felt that the performance was not up to the mark. This is the most common scenario that leads to bitterness. While the poor performance may be a reflection of the appraisee’s effort, capability and competency, let us not forget that the reaction of an appraisee is a reflection of the manager’s skill as a coach and enabler.

Adobe had recently caused a flutter when they announced that they were planning to do away with appraisals. This was hailed by several people. The naysayers wondered how that would give the organization the ability to segregate different levels of performance. How would increments be differentiated if work output was not, they wondered.

The intent behind such a decision is to foster more frequent conversations between the manager and the employee. Without frequent discussions on the what, why and how of work, it can never be motivating enough. Appraisals are not about receiving judgement on the final output. It is about getting feedback and collectively working to improve each step along the way.