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Is it time to sack the appraisal review for its poor performance?

Published 12 November 2018

In recent years the feedback on the value of the performance appraisal has been very negative and it appears that employers can do much better.

There seems to be a growing feeling that appraisals are old-fashioned and no longer the best way to measure the performance of an employee.

At the time of writing a quick Google search of the phrase ‘performance appraisals do not work’ produced over 111 million results.

Critics describe the procedure as one of the tasks managers dislike the most, second only to having to dismiss a member of staff. The performance review method has been labelled insulting, demeaning, anxiety-inducing and dreaded

Research by YouGov commissioned by MHR, revealed that more than half (54 per cent) of employees quizzed believed that annual appraisals were outdated. The process was described as ‘pointless’ or ‘time-consuming’ (1).

The study found that both managers and employees thought appraisals were cumbersome – a traditional and inflexible model contributing to ineffective employee engagement in today’s agile work environment

A notable statistic from the report was that just under a quarter (21 per cent) of those that took part in the study in 2017 said they had not had an appraisal at their current job.

It suggests that a growing number of employers are now starting to move away from this traditional method of reviewing performance, but it’s not a new trend.

In 2015 it was reported that large companies such Microsoft, Accenture and Deloitte had given the old-style appraisal the sack and chosen instead to provide more fluid feedback (2)

For the conventional performance appraisal process, the manager will typically fill in a review document evaluating the performance of the employee over a period of time.

The member of staff will be asked to fill in sections of the review document explaining what they have done well and to highlight areas where they have not done so well and where additional training may help.

The majority of the time the appraisal is likely to focus on what the manager can remember. It is a process that is essentially a matter of opinions as genuine performance assessment can be time consuming

Appraisals often take place annually and it is not unusual for them to be delayed, as it is a task many managers are not comfortable with.

The appraisal system means managers must provide feedback, both good and bad. The employee may disagree and become defensive which can create tension and significant problems in the working relationship, especially as the appraisal may be linked to a pay rise or bonus.

The move away from old school appraisals has seen the focus more on the advancement of the employee rather than on performance.

General Electric, which has more than 300,000 employees in 170 countries, changed its 40-year-old review system: replacing its performance management system with one focused on performance development (3).

The system of ‘insights’ – feedback from both managers and colleagues - is said to celebrate and encourage an employee when they do something good, while offering constructive criticism when employee performance shows opportunities for improvement or needs guidance.

For employers that stick to the conventional performance appraisal system ACAS provide practical guidance. It describes managing the performance of employees as a continuous process, which is central to the relationship between managers and employees (4)

In managing performance ACAS list key points as:

  • Good performance management helps everyone in the organisation.
  • Where a performance management system is working well employees are more likely to engage with the goals of the business.
  • Managing performance is central to the relationship between managers and employees.
  • The way performance is managed should be fair to all staff.

However it is done, a fair performance management system that is designed to help employees develop and progress can benefit an organisation and be integral in its success.

References

1.Are Annual Appraisals Pointless? | MHR [Internet]. [cited 2018 Nov 12]. Available from: https://www.mhr.co.uk/news/annual-appraisals/

2.Martin J. The end of the performance review? 2015 Sep 9 [cited 2018 Nov 12]; Available from: https://www.bbc.com/news/business-33984961

3.How GE replaced a 40-year-old performance review system - Workopolis Hiring [Internet]. [cited 2018 Nov 12]. Available from: https://hiring.workopolis.com/article/ge-replaced-40-year-old-performance-review-system/

4.How to manage performance | Advisory booklet | Acas [Internet]. [cited 2018 Nov 12]. Available from: http://www.acas.org.uk/index.aspx?articleid=2927

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