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STOP Wasting Money on Appraisals

STOP Wasting Money on Appraisals.

Appraisals: you’ve seen it, you’ve experienced it, you’ve lamented it: the yearly farce that is mockingly called “the annual appraisal.”

If it wasn’t so sad, and so wasteful, it would be funny.

The idea of assessing someone’s performance once a year is simply farcical.

Would you assess the progress on a house construction or building project once a year? The requirements of a garden once a year? The state of your bank account once a year? Of course not!

Yet, for various bizarre “reasons” vast numbers of “leaders” in the corporate world think that a once a year morale crushing farce is enough to tick the “people development done” box.

As a leadership coach I appraise progress with the people I help on a second to second basis as the development session continues. If I was coaching leaders in your organisation, would you think it reasonable to assess whether or not I was delivering, as commissioned, on an annual appraisal basis? Of course not. You would want to check that I was getting results for you. You would want to check how each person was progressing during the coaching process, and then again at its conclusion.

That is clear, blindingly obvious, yet many organisations still insist on the “annual appraisal,” and it wastes huge amounts of money. Let’s explore what damage and how that harm is done.

What damage does “once a year” do?

It sends multiple loud and clear signals:

“Your progress matters so little to us, that we will only look at it once a year.”

“We have to be seen to have interest in your performance and once a year enables us to tick that box.”

“You will comply with that process so that we can say, ‘job done.'”

Are those signals likely to boost morale? Productivity? Is treating people like that likely to encourage them to bring their brains to work?

What happens when you treat someone like X? They treat you like X.

What happens when you go through the motions in the “annual appraisal”? They go through the motions, too, all year.

Quid pro quo

Many organisations are aware of that, and are happy with the arrangement. Why?

They perceive that it is more cost effective to have large numbers of obedient, clock-work automatons, than to have people who can think for themselves: “Finding managers who know how to develop and get the best from staff is expensive, don’t you know!” Yes, it is, and my reply? “How much does it cost not to?”

“You think knowledge is expensive? Try ignorance!”

Companies that use the “annual appraisal” system can tell you how much it costs to develop people, but can never tell you how much more it costs not to!

Once such “reasoning” is in place, the next stages logically follow. What is the next stage?

Creating an environment that turns people in to and is attractive to, obedient, clock-work automatons.

How is that achieved? By sending powerful signals, such as “you will only be appraised annually.” There are many other signals, such as the recruitment process, and that will be the subject of another blog posting. For now let’s stick to encouraging you to stop wasting money on appraisals.

If the idea of annual appraisal is farcical, then its execution is unintended drollery. What makes the appraisal process itself so tragicomic?

Common appraisal errors

The common errors in appraisal apply whether the once a year tick box version is used, or better-intentioned approaches are adopted.

“Yes, I understand. What was your name?”

You’ve seen this. You are being appraised and you know the appraiser is not listening.

This too: the appraiser reaches hasty conclusions, which are not thought through, which have no evidence to support them, which seem more based on personal likes and dislikes than anything to do with your performance.

How do you react when you’ve been treated like that? Does your productivity go up? Or the opposite? More money, unknowingly, wasted.

This you have also seen, directly or indirectly. The appraiser expects you to make too rapid a change. “No, yesterday is not soon enough!” We all know that people change slowly. Good leaders know what happens when they try to make people change too quickly. Bad leaders live with the consequences of such doomed efforts. When someone has pushed you too hard, do you put forth more discretionary effort? Or do you withhold discretionary effort? More money wasted.

The appraiser makes unfulfillable commitments.

This too, you have observed in appraisals.  “Yes, you can have jam tomorrow.” And when the much promised jam does not appear, what effect does that have on you? Do you bring ideas for improvement to the person who misled you? Or do you have the ideas and keep them to yourself? Money wasted.

The appraiser judges people who are similar to her/him more favourably, and people who are dissimilar to her/him less favourably.

If you haven’t seen this, I will be amazed.  When I go into help large companies sometimes this one is actually visible: entire departments can be filled with people who could be clones of each other. What happened to the people who didn’t fit the similarity mould? They either were never recruited, or after experiencing how they were less favourably treated, they moved on.

When you have been treated less favourably on unfair grounds, how do you respond? Do you alert the person who mistreated you when you can see a big problem careering towards them? Or do you let justice be done? More waste. Costs incurred that could have been avoided.

That was just a small sample of the many psychologically based, unintended, appraisal sabotage errors, which, if addressed would enable companies to stop wasting money on appraisals. There are many, many more.

Here is another category of money wasting errors in appraisal: political problems

Using appraisals as the justification for whatever pay award has been decreed.

You’ve seen this, maybe even been on the receiving end of it: the appraisal process is a charade used to justify the limited and demoralising annual pay increase. Clearly if pay cannot go up, no-one has performed well. The appraisal must match the available resources. Ho, hum! If you are looking for a quicker way to kill your credibility, and any trust in your judgement, you will waste your time looking for a better one than this. More money wasted.

Using appraisals to defend the T & D budget.

Obviously (!) if there is no budget for training, then you cannot have an appraisal that demonstrates a training need that the company is leaving unaddressed. Better, (tongue in cheek), to give someone an average appraisal, citing no major development needs, “only minor refinements required.” If you haven’t seen this farce unfolding, don’t worry, you will. Waste coming down the line!

Have you ever met Mr and Mrs ‘We’re doing it already’?

A charming couple. They were into empowerment while most of us were still managing by objectives. They were also practicing quality circles before the wheel was invented. “Of course we provide effective appraisals; we do it every year!” Ugh! How will you persuade Mr and Mrs ‘We’re doing it already’ that they may be doing something, but it falls very far short of what is recognisable as effective appraisal?

When proper coaching appraisal is conducted with the appropriate frequency, most of the above problems diminish or disappear. A strong coaching relationship boosts morale and productivity in ways you can’t imagine, if you have not experienced it. If you have, you’ll know how true that is.

Contrast that to what you have almost certainly experienced, massive waste of money and damage to morale in the annual farce known as “appraisals.” Stop wasting money on “appraisals” and start engaging in coaching appraisal.

Sometimes the best solution to a problem is encapsulated in comedy. Watch this short video and then do what the therapist advises to annual appraisals. https://www.youtube.com/watch?v=Ow0lr63y4Mw

How do you stop wasting money on “appraisals”?

By learning how to conduct effective, coaching based appraisals; appraisals that actually lead to improvements in productivity and morale, and then building those improvements in to the culture of your company.

Yes, that means that you need state of the art understanding of advanced coaching, advanced coaching based appraisal, and, culture leadership.

The normal reaction is phrased as a question but expressed as a protest: “How much will that cost!” A lot less than continuing the waste.

If you wish to continue wasting money on “appraisals”, do nothing, take no action.

If you want to stop wasting money on appraisals contact PsyPerform.

You can make your appraisals effective with PsyPerform in many ways: face-to-face, by Skype, by telephone or by email, wherever you are in the world.

Prof Nigel MacLennan

Copyright PsyPerform 2016