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The annual performance review

Does it really make sense to put employees and team members through a performance appraisal?

You’re busy, of course, so finding an excuse for not doing annual performance evaluations with employees and team members looks so very tempting. Would it really be so bad if you pushed the reviews onto the back burner?

The answer is an unequivocal “yes,” according to Dr. Sara Mann, an associate professor specializing in human resources and leadership in agriculture at the University of Guelph.

Even if your farm has only one employee, from both a legal and employee development perspective, you should be completing an annual review process, says Mann.

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Performance management pays off, she says. “Research shows it can improve employee performance, productivity and safety.”

However, Mann notes it’s important to carry out the process accurately and fairly or else the annual performance review can actually backfire and result in diminished employee morale and productivity.

In reality, just doing a once-a-year performance appraisal isn’t enough on its own. Instead, Mann says reviews actually need to be part of a bigger performance management process that provides continuous feedback throughout the year.

Feedback needs to be part of your culture, and it needs to be provided daily or at least weekly.

“That way,” Mann says, “there aren’t any surprises at the time of the actual review. To use a sports analogy, if a hockey coach only gave feedback to a player once a year it would not be very helpful.”

The value of the annual performance appraisal is two-fold. The first is for administrative/legal purposes that increase the defensibility of your HR practices, says Mann.

Performance reviews create an evidence trail if you need to provide justification for who was dismissed, promoted, chosen for training opportunities, received pay increases, etc.

The second purpose of the annual performance appraisal is to provide developmental feedback to your employees and to motivate them. Mann points out that in order for employees to feel motivated by the review process, they need to feel the process is fair, and a big part of how they make that assessment comes with ensuring they receive continuous feedback throughout the year.

Pitfalls to avoid in your performance appraisals

University of Guelph professor Sara Mann says research shows that performance appraisals fail for many reasons. Some of these include:

  • The manager lacks information regarding an employee’s actual performance (for example, they are unaware of all of the employee’s behaviours).
  • Performance standards are unclear.
  • The manager does not take the performance appraisal seriously, is not prepared for the review, and lacks the skills to conduct it.
  • The manager is not sincere and uses unclear, ambiguous language during the review.
  • The employee does not receive ongoing feedback.
  • Insufficient resources are available to reward performance.
  • There is a lack of attention to employee training and development.

Several other factors also come into play to create a review process that feels fair to the employee. “Research tells us that the performance appraisals need to be valid, reliable, free from bias and practical,” says Mann.

Elaborating on these research findings, Mann says “valid” means that the questions and measures used are related to what the person actually does on the job. “Reliable” means the questions and measures are applied consistently to all employees. “Free from bias” means the person conducting the review has to show they are not biased for or against an employee. And “practical” means that although we spend a sufficient amount of time and resources to develop the performance appraisal, it is realistic from a time perspective for those involved.

Ask the right questions

Mann provides several tips for creating an effective performance appraisal.

Basing the questions on a written job analysis will help ensure the questions relate to the actual responsibilities of the employee. This will also increase the review’s validity, both for the employer and employee.

Behavioural criteria, based on the job analysis, make it clear what behaviours the employee should start and stop doing. Care must be taken to ensure these behaviours are observable and they are under the employee’s control. Employees must also be informed of expectations ahead of time.

Employee involvement in the development of the review process further increases perceptions of fairness.

Unfortunately, appraisals are more often a reflection of the appraiser’s overall biases than they are the performance of the employee, says Mann. For instance, the perception of an employee’s performance varies between peers, subordinates and supervisors. “How an employee interacts with the boss is not necessarily how the employee interacts with their peers or subordinates,” she says.

Studies have also shown that people have gender biases with women being judged more harshly than men, and appraisers rating people more favourably if they perceive them to be like themselves (unless the appraisers are female), says Mann.

People are often unaware of these biases and as a result, appraisers should receive training to minimize errors due to these biases, says Mann.

Training appraisers will also help them to provide feedback to employees with sensitivity and tact. This is critical for an effective review process, says Mann. To bring about a positive change in behaviour, coaching should focus on the behaviour rather than the person, be selective so as to not overwhelm the individual, focus on the desired rather than the undesired behaviour, and clearly demonstrate the desired behaviour with examples, says Mann.

Also, specific goals for future behaviour must be set and the individual must be committed to meeting these goals for change to take place.

Having multiple people from different levels within the farm business perform appraisals is another method for countering the bias inherent in having only supervisors perform reviews.

“Multisource feedback gives a more integrated and holistic view of an employee,” says Mann.

While the job of creating and implementing a performance management strategy can seem daunting, the time and energy invested will pay dividends with improved productivity, better employee morale, reduced employee turnover and a safer workplace.

What is performance management?

The annual performance appraisal is part of a performance management process that ensures workers know what is expected of them and how they can meet or surpass these expectations. It helps ensure employees develop the appropriate skills and abilities, promotes worker engagement, it cuts employee turnover and it reduces the number of accidents and injuries.

Source: Canadian Agricultural Human Resources Council (CAHRC) Agri HR Toolkit.

Resources

For more information on conducting effective performance appraisals, see the Canadian Agricultural Human Resources Council (CAHRC) Agri Toolkit.

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