Gill Taylor: The five mistakes made with annual appraisals

If your system is just a paper exercise, it's time to chuck it out and start again, writes the sector HR consultant

Gill Taylor
Gill Taylor

Just what is the point of an annual appraisal? It's a process managers hate, at worst, and feel ambivalent about, at best. Let's face it, HR people hate it too, especially when we feel it is a paper exercise that wastes everybody's time.

Ideally, an annual appraisal should be about valuing staff and recognising their contribution. This in turn should have a motivational effect and increase engagement and loyalty while stimulating learning and development. If your system is a paper exercise that does none of these things, it's time to chuck it out and start again.

There are five basic mistakes organisations make with annual appraisals. The first is having a system that is unrelated to the rest of performance management. Honest feedback needs to be given to staff throughout the year at supervision sessions or one-to-one meetings, or just as you go along. This takes the weight off the actual appraisal and means staff have a sense of how well they are doing all the time. It also allows them to tell you the organisational or team stuff that's getting in the way of them doing their jobs.

Second is doing annual appraisals out of sync with the strategic planning process. If you have an annual plan with targets and outcomes, do the appraisals just after these are set. It might mean they are all done in one particular month, but you can make really meaningful the part of the appraisal that looks ahead to the new year.

The third mistake is using a complex form to which no one pays attention for the rest of the year. Preparation on both sides is necessary. Ideally, you should be giving upward feedback to your line managers, which is possible in a healthy relationship. But there is no need to make the form long or irrelevant. If it's related to the rest of the performance management system, it should all tie in. Do it online. A record is important, especially if you want to start performance-managing the staff member soon. And don't give an employee a glowing appraisal one week and start capability proceedings the next.

Fourth is tying annual appraisals to pay increases. This makes it scary and gives it too much weight.

If you have performance-related pay, assess performance over the whole year.

Fifth, having appraisals that are not genuine. To get the best out of the process, annual appraisals should mostly be about praise – challenges can be dealt with during the year. If you are having serious doubts about a person's performance, don't wait until their appraisal to bring this up. Do it closer to any action taken over poor performance.

If one reason for appraisal is to value staff and improve performance, managing people must be more of a continuous process. The appraisal should summarise performance and development. And call it something else: a performance development review, perhaps.

Gill Taylor is a sector HR consultant

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