Employers can increase employee engagement by tying individual contributions to the company’s overall performance. Aligning people with purpose requires clarified expectations and a trusting relationship between the employee and supervisor. Traditional performance appraisals undermine this trust.
Honest constructive feedback violates social norms according
to the NeuroLeadership Institute. Feedback sounds like judging. Neither the
giver nor the receiver is comfortable with judging. That is why people judge
high, and judge nice.
More than 400 large companies have removed ratings from their performance appraisal processes and have abandoned the traditional review of previous performance. There is a lot of convincing evidence that demonstrates how bad the traditional performance review process is. Not only is it time consuming and inaccurate; it is also threatening. The threat of judging and being judged dismantles trust. It’s threatening and stressful for both parties even when the feedback is positive according to neurological studies.
These 400 companies are far from perfecting the process, but they agree on several factors. They have abandoned the rating system and they do not look backward. Time is spent with the employee rather than with the document or room of managers discussing employees. The focus is on the employee’s development and future. It’s a real time conversation with the employee.
Many of these companies have spent more than six years on
this journey. We can benefit from their experiences. Removing ratings has
resulted in increased frequency and quality of conversations, and increased
engagement and pay differentiation. During their journey, companies have
determined the conversations require structure.
The NeuroLeadership Institute studied 27 companies that shed
their ratings and recommends a framework to encourage regular conversations
with specific expectations. They suggest establishing a set number of
conversations about goals, wrap up conversations at the end of certain
projects, career path conversations, compensation conversations and check-ins,
as well as feedback sessions.
Having a known structure and frequency provides a little control for the receiver. Unsolicited feedback whether it’s positive or negative is perceived as a threat. The receiver will be defensive and/or rationalize which detracts from the message. Even solicited feedback is threatening.
Solicited feedback can be safer if the question is very specific, such as asking if “more or less is better.” Another way to make it safer is to ask a number of people to get a broader view. Many of these companies who have moved to this contemporary performance evaluation process are changing to an “ask culture.” Of course, it must start at the top, with managers asking their staff for feedback often.
Providing feedback at the end of a project is easier. It’s about the project, not the person. The focus is on next time and what development will improve results in the meantime. This is a healthy and respectful way to tie individual contributions to the company’s performance and opens the conversation to individual development.
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