THE BUSINESS BOOMER – #6a – Those Pesky Performance Reviews Are Necessary

What supervisor or manager loves giving performance reviews Not only do they require thought and a measure of diplomacy (and thusly tend to get delayed due to other more “important” functions.. like making money) but if you are doing them correctly you are likely groping for goals and achievement milestones by which the employee can gauge future performance.  On the other side of the coin a performance review could bring up performance shortcomings and possible disciplinary action and given we are all human we tend to want to avoid conflict and delivering bad news.  Employees don’t much enjoy performance reviews either because it brings out the “bad” and shortcomings they may or may not be recognized for; feeling like they are being picked on, and feeling like a review is just management’s way of justifying a small or non-existant raise in pay, or setting someone up to be fired.  They are also seldom given on time anyway so an employee can feel less than important at the get go.

So why do them at all if everyone hates them?  Well, everyone hates them because they are not done properly.  It doesn’t mean that if done “properly” that everyone will enjoy them, but in the least there should be enough confidence and value in reviews being real tools for gauging employee performance and engaging employee participation toward future performance goals.

Let’s start at square one here.  Performance reviews are not required.  For the vast majority of small businesses performance reviews are skirted because many states have an “at will” employment rule on the books which removes the idea that a company needs to show cause for termination.   Hence the performance review itself need not be a required mechanism for documenting continued employment.  But… if any company publishes an employee manual that contains rules regarding performance reviews and progressive disciplinary policies that could include termination, then that company is usually bound by the elements contained in that manual regarding an employee’s employment, regardless of any “at will” laws.   Each state has different laws that may apply in such cases and to what degree a contract of employment may be implied.  But many companies recognize it’s in everyone’s best interest to have a formal performance review policy in place given the time and investment the company makes in training new employees.  After all, it’s not good management technique to hire someone with the idea, “Well, given this state has ‘at will’ employment, if this person doesn’t work out we can fire him and find someone else.”  Morally speaking, if you fire someone it generally means that management is as much to blame as the employee.

But performance reviews, if given at all, are almost always given by an employee’s immediate supervisor/manager… which means any management person who has a subordinate gives at least one review.  But the vast majority of management people have absolutely no training in preparing and giving performance reviews.  Heck, in my college days there were no classes teaching the elements of giving reviews and as far as I know, the major MBA universities in this country don’t even offer such courses in this day and age.

But my point here is that the importance of performance reviews must be established at the top; importance and value must be conveyed from the top of the organization, down to every level.  When I worked for Quill Corporation (a private mail order office supply company now owned by Staples) the HR department would send the manager or supervisor in advance of an employee’s review date (typically tied to an anniversary of  the employee’s date of hire) the appropriate employee review form for that employee’s area of responsibility.  To assure progress was being made in giving that review in a timely manner the HR department would give the manager a couple reminders.. then ultimately if necessary, would report the manager to his/her own manager/director if the delay got too out of hand.  In other words, there was a measure of checks and balances to assure a more timely and responsive delivery of performance reviews.  In other words, performance reviews were given a corporate priority.  In fact, at Quill there was a specific question on the supervisor’s review requiring feedback as to that supervisor/manager giving performance reviews in a timely manner.  The company was serious about giving timely reviews to the point that it was a measured performance element for management as well.

But reviews, if a company is truly serious about them, need to be a legitimate work priority, not just some yearly or bi-yearly pain-in-the-ass gauntlet for everyone.  If a supervisor/manager has subordinates then giving timely reviews should be a priority responsibility, like any other performance responsibility, for that management person.  In other words, if you are hiring a manager to lead a group that designs widgets then that manager must also have performance review skills as an equal priority skill set.  You don’t hire a widget design manager and tell him later, oh, by the way.. you have to give performance reviews to your entire staff a couple times a year.

It’s generally accepted by the average rank-and-file that performance reviews have three primary functions.  One is allowing the company to document any employee shortcoming as part of a progressive disciplinary process that could lead to termination (if this is documented in a published employee manual).  The second is that it gives the employee a chance to aire their grievances.  The third is documenting and recognizing accomplishments that may lead to a salary increase.  While these elements are in fact reasons for having reviews these should never be the priority reasons.  The primary goal should always be to convey the performance expectations of the employee in order to make them a better employee and thusly a greater asset to the company in general.


My next post in this category (THE BUSINESS BOOMER #6b) will present a list of reasons for establishing the importance of giving performance reviews at all levels.


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