5 mistakes to avoid when conducting performance evaluations
Every well-rounded manager knows how important it is to conduct a performance evaluation periodically. Well-conducted evaluations help managers track perform and commend well performing employees and help those underperforming to improve. Research shows that companies who implement employee feedback on a regular basis have 14.9% lower turnover rates than those companies who don’t give feedback.
Knowing the benefits of performance management, it is important to note that not all performance evaluations are positively effective. A report by Clear Company showed that 45% of managers don’t trust that performance reviews are an accurate representation of employees’ work. Further, only 23% of human resource executives perceive the performance evaluation process as a correct reflection of employees’ contributions.
This being said, it’s important that a performance evaluation is performed the right way in order to reap its intended benefits. Here are five mistakes that managers can avoid when performing performance evaluation:
The ‘halo’ effect and the ‘devil’ effect
This is when the manager’s opinion is influenced by one good rating or one bad rating and lets this influence the whole performance evaluation. For example, an employee could be the best there is in sales, yet they underperform in all the other areas. However, the manager is influenced by the sales ratings and rates the employee’s overall rating as high. This can be avoided by keeping a log of evaluation in different performance areas throughout the period.
The recency effect
This is when managers base evaluation on the employee’s most recent behaviour instead of representing the whole performance period. Some employees, knowing that evaluation time is due, will try to improve their performance while in other cases; an employee’s performance may have dropped in such a way that the manager is unimpressed and bases the evaluation on these recent events. To avoid this, managers ought to maintain an ongoing file on employee’s job performance throughout the period.
The central tendency effect
This happens when the managers have not given performance evaluation much thought in the period of evaluation. Therefore, when required, managers give an average rating for every employee in every category. Sometimes managers do this in an attempt to satisfy everyone when they don’t want to be perceived as too severe or too lenient. Often times, this happens as a result of unpreparedness and it does not serve the purpose of performance evaluation. Managers can avoid this by keeping a record on every employee’s performance such that every grade given is justified by facts and this information informs the final evaluation report.
Knowingly or unknowingly, managers may allow irrelevant factors to influence evaluation. For example, a manager may allow physical appearance, political or cultural affiliations, social standing or other non-job-related factors influence the evaluation negatively or positively. This can be avoided by ensuring that evaluation is not conducted by one person, or monitoring evaluation by managers by another person so that it is conducted objectively.
Giving vague feedback
The whole purpose of employee evaluation is to recognise improved performance and correct underperformance through feedback. Managers therefore should give very clear information on areas that need improvement and areas improved. When vague reviews are given, employees are not certain of what they did right or wrong. A performance evaluation report should therefore not be vague, but clearly point out on areas that need improvement and even pointers on how they can do better.