Best Practices: Evaluating Performance

Barry Silverstein

• Publisher: HarperCollins e-books
• Year: 2009
• ISBN:
  9780061738920
• Topic: Negocios y empresa
• Subtopic: Gestión de recursos humanos

Successful management relies on identifying and promoting high-performing employees—and targeting underperformers for serious improvement. Evaluating Performance, a comprehensive and essential resource for any manager on the run, shows you how.

Learn to:

• Monitor day-to-day performance
• Conduct productive formal reviews
• Reward consistent, excellent performance through promotions
• Terminate underperforming employees
• Create a company-wide performance management system

The Collins Best Practices guides offer new and seasoned managers the essential information they need to achieve more, both personally and professionally. Designed to provide tried-and-true advice from the world's most influential business minds, they feature practical strategies and tips to help you get ahead.

ONE-ON-ONE PERFORMANCE MANAGEMENT

“The best way to inspire people to superior performance is to convince them by everything you do and by your everyday attitude that you are wholeheartedly supporting them.”

—Harold S. Geneen, CEO of ITT (1910–1997)

With today’s shifting workforce, a manager’s responsibility for evaluating employees is all the more challenging and complex. In the coming years, as more and more baby boomers retire, experienced workers will be at a premium as they become increasingly hard to find.

Self-Assessment Quiz

HOW WELL DO YOU MANAGE YOUR EMPLOYEES’ PERFORMANCE?

Read each of the following statements and indicate whether you agree or disagree. Then check your score at the end.

1. I get to know each of my employee’s likes and dislikes.
   • Agree • Disagree
2. I generally can tell when an employee is distracted or having trouble focusing on the job.
   • Agree • Disagree
3. Employees generally trust me.
   • Agree • Disagree
4. I evaluate an employee’s performance at least quarterly.
   • Agree • Disagree
5. I often informally let my employees know how they are doing, in addition to giving scheduled evaluations.
   • Agree • Disagree
6. I tell employees when they are doing something wrong, but I try to present my comments as constructive criticism.
   • Agree • Disagree
8. Employees know that they can tell me something personal and it will remain confidential.
   • Agree • Disagree
9. I believe in promoting from within when it is possible to do so.
   • Agree • Disagree
10. I encourage employees to speak their minds, and I really listen to what they have to say.
    • Agree • Disagree
11. I would not terminate an employee for poor performance without giving ample opportunity to correct the problem.
    • Agree • Disagree

Scoring

Give yourself 1 point for every question you answered “Agree” and 0 points for every question you answered “Disagree.”

Analysis

8–10	You manage your employees’ performance very well.
5–7	You need to work on your performance management skills.
0–4	You have a lot more to learn if you want to be a good manager of employee performance.

Most companies will hire younger employees with fewer years on the job—individuals who need well-defined goals, on-the-job training, and continual supervision.

What should managers look for when they evaluate the performance of these employees? How should they evaluate an individual employee’s initiative, work quality, and potential for advancement? How should managers document employee evaluations? How often should they review employee performance? How do managers promote an employee—or fire one?

There are no shortcuts to employee evaluation, but there are processes, strategies, and techniques that help managers evaluate employees more effectively. This book addresses the fundamentals of employee evaluation: hiring, day-to-day performance management, reviews, and what to do about performance problems.

WHY PERFORMANCE MANAGEMENT MATTERS

Traditionally, evaluating performance has meant employee appraisal, or “the performance review.” Today, however, many organizations are moving beyond simply reviewing employee performance toward a more comprehensive performance-management process.

Performance management is a process-oriented approach to evaluating and supporting employees. Ideally, performance management takes place from the moment the employee is hired to fill a position at a company to the moment the individual leaves the organization. If a company and its management adopt this broad view, managers are in a much better position to help develop each employee’s potential, and employees feel better about their positions and the company they work for.

Performance management helps managers develop the staff they have and keep them motivated; raise the standards of quality and promote productivity; and keep employees in tune with corporate goals.

At the heart of performance management is the process of employee evaluation. Ideally, managers periodically evaluate employees informally throughout the year; formal evaluations typically are done on a quarterly or annual basis.

In fact, the annual performance appraisal has stirred up controversy in management circles. Although the performance appraisal is intended to help employees improve their performance, succeed at their jobs, and then potentially be promoted, it often ends up being used merely as an annual review—a method of handing out rewards and punishments. This is why current opinion favors using the performance appraisal as just one element of the broader performance-management process, which encompasses the employee’s entire tenure at the company from hire onward.

The BIG Picture

EVALUATIONS VERSUS APPRAISALS

Performance “appraisal” is often mistaken for performance “evaluation.” An appraisal is typically conducted once a year and is usually connected to compensation (that is, salary increases and bonuses). Managers and employees alike often find the appraisal process burdensome and dissatisfying.

Constructive performance evaluations can yield significant benefits. In fact, they may be the employee’s only opportunity to spend individual time with a supervisor. The more often they occur, the better the communication will be between manager and employee, which improves morale. When supervisors make time for frequent evaluations, several key benefits can result:

Outside the Box

A PERFORMANCE AND VALUES MATRIX

Former General Electric CEO Jack Welch described four types of employees in a letter to shareholders in the company’s 1991 annual report. He wrote that the two types that are easiest to spot are employees who delivered on commitments and shared the company’s values and employees who did not meet commitments or share values. The third type were employees who shared values but failed to meet commitments. Welch felt these individuals could be redirected. The fourth type, however, was the most problematic: those who delivered on commitments but did not share corporate values. Ultimately, Welch sent them packing.

You can create a performance and values matrix to help you evaluate your employees in a similar way. Think about the people on your staff and whether they perform well and share company values. Then place them into the appropriate boxes on this matrix:

PERFORMANCE	VALUES
High	High
Mixed	Mixed
Low	Low

As you evaluate employees, consider the specific events and behaviors that guided your decision of where to place them in the matrix. Then, for each person, identify weak areas, decide if coaching is needed, and devise a plan to help the person improve.

SOURCE: The Leadership Engine by Noel M. Tichy (HarperCollins, 1997).

Job satisfaction. Job satisfaction tends to increase after a review, because the employee is getting personal attention from the manager and is involved in the evaluation process.

Improved performance. If the manager delivers feedback in a positive way and both employee and manager agree to specific goals, a significant improvement in performance can result.

Development. Performance evaluations offer excellent opportunities for managers and staff to agree on how workers’ abilities can be developed—whether through formal or on-the-job training or skills-development programs.

Rewards and recognition. When performance evaluations are linked with rewards and recognition, and are used as the basis for salary increases and bonuses, they become even more powerful motivators.

Organizational improvement. Performance evaluations can provide a valuable assessment of how certain types of people perform in specific jobs. Managers can use this information to improve job descriptions and to recruit the person best suited for a position.

START BY HIRING THE RIGHT PEOPLE

The first step in performance management is hiring the right person for the right job. All too often, a manager is forced to hire under pressure. When an employee leaves a position, or when a new job opens up, the manager scrambles to fill the opening as soon as possible. In the heat of the moment, the manager might settle for a conveniently available job candidate instead of waiting for the best-qualified one.

While it may be time consuming, you should thoroughly screen all viable candidates during the hiring process. Match the candidate’s skill set to the position. Consider relevant experience and strong references, but also be sure the individual will fit well within your organization. You are actually evaluating the potential of the candidate to be successful at the job. This is just as important as employee evaluation.

CASE FILE

HALLMARK DETERMINES IF NEW HIRES MEET EXPECTATIONS

When Hallmark Cards couldn’t find a tool to help it measure its recruiting success, the company built its own “staffing index.” New employees were scored on “initial candidate quality” from average to outstanding. After six months on the job, the employee was evaluated on the same five-point scale to determine if the manager’s expectations had been realized. The process continued through the employee’s first and second annual reviews, so the company’s recruiters could get a long-term picture and “judge the enduring quality of a recent hire.”

SOURCE: “Hallmark’s Quality-of-Hire Initiative” by Aaron Dalton, Workforce Management Online (May 10, 2005).

What is the best way to get the right person for the job? Write the best job description possible.

The Job Description as a Performance Management Tool

A good job description is both a hiring blueprint and a performance management tool.

A job description should be written in concise, easy-to-understand language. It should include enough detail to convey specific job responsibilities, but be flexible enough to allow for employee growth.

Include the title of the job, a summary of the position, the employee’s manager or supervisor, a list of specific responsibilities, including supervisory duties if any, and specific qualifications for the position, such as education, experience, and character traits.

Include a statement covering your company’s expectation of how employees should relate to coworkers and customers and how employee performance will be evaluated.

It is also a good idea to add inform...