Tuesday, October 21, 2008

Performance Appraisals

A recent Wall Street Journal story by Professor Sam Culbert of UCLA lambastes the annual corporate employee performance review. He is absolutely right on point, but his is neither the first, nor the most detailed critique. Tom Coens and Mary Jenkins provided this in the 2000 book, "Abolishing Performance Appraisals."

Best Buy decided some time back to stop focusing on an employee's shortcomings, which are unfortunately the focus of a performance review. The traditional, hidebound review may focus on shortcomings related to outputs, timeliness, ability to work with a team, or even personal habits. Instead, Best Buy decided to focus on the employee's assets and on ways to strengthen and enhance them. This is much more enlightened, and can create an atmosphere where everybody wins.

Here is some text from Professor Culbert's article:
"You can call me "dense," you can call me "iconoclastic," but I see nothing constructive about an annual pay and performance review. It's a mainstream practice that has baffled me for years.

To my way of thinking, a one-side-accountable, boss-administered review is little more than a dysfunctional pretense. It's a negative to corporate performance, an obstacle to straight-talk relationships, and a prime cause of low morale at work. Even the mere knowledge that such an event will take place damages daily communications and teamwork."

It is sad to see that the idea that the archaic performance review tool may not be working could be considered "iconoclastic."

One of the first principles for an effective team manager is to have the right players on the team, and second to have those players assigned to the roles in which they can perform the best and deliver the most value. The manager's task is then to make sure that the employee is empowered to deliver by having the appropriate tools, processes, directions and management support. Very often, a employee's not delivering on performance goals is related to management's failure to provide some of the requirements that empower the employee to deliver.

Hence, it is much better to focus on the positive--namely, how were the employee's assets used over the time period, and what can be done by everyone (the employee, supervisor, team members and management) to improve the asset utilization and performance?

No comments: