Performance appraisals are a big area for change in 2014. The modern performance appraisal should look quite different from the way it was done in 1980 (Jack Welch era) or 1920. So what are some of the key characteristics of a modern performance appraisal in thriving businesses today?
Performance appraisals used to be conducted once a year, at the end of the year. You would spend days preparing your summary of key achievements, feedback and results for discussion. Your manager would present his/her side of the argument and the proceedings would be ended. All would be forgotten until the same time next year when the arduous process would repeat itself.
In the modern era, performance appraisals should happen all the time on a much more informal basis. Go for a coffee with your manager; discuss your strong points and your areas for growth - and often you will have the opportunity to return the favour and provide feedback for your manager. These frequent check-ins are a great way to take the pressure off the traditional year-end performance review and if they are done frequently enough there should be no nasty surprises waiting for employees at the end of the year.
Communication should be two-way by default; but all to often this is not the case. Your performance review in the past was a one way conversation. Your manager told you what the opinion, rating and results of the annual review were and you took the news without discussion. The modern performance appraisal is about having an honest discussion (two-way!) with your manager about your performance. Employees should be able to voice their opinion on the feedback received and be open to learning about their development needs. Managers should practice the art of listening! Performance appraisals are an ideal time to understand the aspirations and goals of your team members and a well crafted performance conversation will leave plenty of time for you to listen to your employees.
The Best Places to Work Survey of 2014 found that addressing employee development needs was one of the top drivers for your business being a great place to work. A performance appraisal which does not address your development points is a failed opportunity. Everyone has development points - if you don't, you're in the wrong job (and probably very bored). An open conversation should start with what you did well, and move on to what you can do better. Your development points should be documented and ideally tied to your goals (i.e. one of your goals can be to address specific development points). Mastering a development point at the next performance period end is a sure sign of someone who is managing their career well.