The annual appraisal has been a firm fixture on enterprises’ calendars for decades and has become a staple in any manager or HR professional’s toolkit. But this isn’t to say there aren’t plenty of people who feel that there are significant flaws in the appraisal system. Speaking at an event this April, Lucy Adams, former HR director of the BBC and director of Lucy Adams Associates, the leadership resilience consultancy, decried the bog-standard annual appraisal, saying: “I want to explode the myths that appraisals work: they don’t.”
Certainly a bold statement but if our current method of reviewing staff isn’t up to scratch, what are our options? We caught up with Adams herself to get the lowdown on how we can improve our approach to appraisals.
Right off the bat, Adams is keen to clarify that it isn’t the fundamental principle of appraising staff performance that she feels is failing. “I don’t have an issue with many of the elements that can be part of an appraisal if it’s done well,” she says. But, unfortunately, the way appraisals are implemented often prevents this, she argues.
Inevitably, as an enterprise scales from start-up to SME, observing and encouraging staff becomes more structured. “Organisations tend to look at a process solution because it is easy to apply, it is important that they are consistent and they want to make sure that they can monitor and measure what’s happening,” Adams says. However, because of this structured approach, appraisals are often implemented on an annual basis and, for her, this is where things start to become ineffective.
“Changing behaviour is really hard,” Adams comments. “Research shows that one of the ways you can increase the chances of success is deal with the behaviour that you want changing at the point where the behaviour is being exhibited.” Explaining by way of an analogy, she says that if someone saw their child was having problems on their bike, they would help them straight away. “Waiting for six months to have an annual review with them to actually help is just absurd.”
But it’s more than just a question of immediacy. Often appraisals will be held at the same time of year, with the idea that this will create greater efficiencies, but of course the opposite is often true. “Everybody’s trying to do it at the same time,” Adams says. “You’ve got issues of privacy, room booking, taking people out of the business.” It becomes such a significant organisational challenge that many managers will simply be focused on getting through it, rather than concentrating on how to provide the best feedback.
There’s also a danger that the irregular appraisal structure can become something of a crutch that discourages people from tackling things head on. When one knows an appraisal is looming in a few months’ time, it can be easier to file a problem away rather than dealing with the situation when a response can have the most impact. “Managers think they can put it on a back burner and think ‘I’ll deal with it then’,” Adams explains. “But by that stage it’s actually too late.”
Another problem with stalling until there’s an appraisal is that often many things can get left by the wayside. Whilst the expectation is that managers will be making comprehensive notes on employee performance, this is rarely something that happens when individuals are wrestling with day-to-day business concerns. Adams says: “What will often happen is that the manager will give feedback on something that just happened as opposed to giving a more balanced reflection.”
From an employee’s perspective, this can be hugely dispiriting and call into question the value of even participating in appraisals. Inevitably, an employee’s own performance and future career development is going to matter more to them than to someone who is simultaneously handling dozens of similar reviews. “It’s going to be more important to the employee to have that detailed conversation than it is going to be for the manager,” Adams explains. “There’s always the syndrome where the employee feels they’ve been short-changed.”
However, there is a deeper factor at work that can prevent an appraisal session being useful for an employee. Often the sheer pressure of having an entire year’s worth of professional work assessed can derail any attempt to make positive headway.
Adams makes reference to research led by the NeuroLeadership Institute that explains our psychological reaction to threats to our status, certainty, autonomy or our sense of fairness – all things that potentially can be challenged in an appraisal environment. When these things come under threat – as when we are placed under physical threat – our bodies kick into a fight, flight or freeze response. “All of our brain’s resources are rushing to avoid or resist the threat,” she explains. “Conversely, the parts of our brain that actively encourage engagement, openness, curiosity and problem-solving shut down.”
So, in light of all of the problems with annual appraisals, what’s the alternative?
Inevitably having more regular feedback is going to be vital. To this end, many businesses are trying to provide managers with the skills they need to much more effectively offer support and feedback to employees in the day-to-day working environment. “What they’re typically moving towards is looking at the coaching capabilities of their managers, developing skills for their managers where they’re more able to coach people whilst they’re working alongside them,” says Adams.
Another vital area is learning more about employees. Whilst there is a massive trend towards understanding and tailoring responses to customers through data and algorithms, an enterprise’s knowledge of its own staff often pales in comparison. “It’s important to know your individual team members,” Adams explains. “How they like to learn, how they like to grow, how they respond to threats and awards and then apply that in a more individualistic, tailored way.”
But Adam’s last piece of advice is perhaps the most radical step of all. “Remove all paperwork from the equation,” she says. Whilst there will be a strong knee-jerk reaction from those whose management style is very process-driven, very few employees actually need a paper trail to keep track of their own professional objectives. And over-focusing on which box an employee should go in or what grade they’ve received often misses a more nuanced picture of their performance. As Adams explains: “Take away the paperwork and focus on the conversation.”
Essentially, making appraisals more effective comes down to making them a more natural reflection of the way an enterprise works and embedding employee feedback within the natural rhythms of the business. “The conversation that you have over the coffee machine, standing over somebody working on a joint presentation,” Adams concludes. “Go with existing behaviours in the workplace and make the most of them.”