On Being Good at Performance Appraisal

I hold these truths to be self-evident (well hey, it is my blog):

Truth #1:  Performance management is with us for the long term.  And the reason for this is that people need clear information about what is expected from their work and how they are doing at meeting those expectations.  They need it regularly, no matter how busy and overwhelmed their bosses may be.  Could we improve how we do performance management?  No question.  And hopefully we will.

Truth #2:  Performance management will never be easy, comfortable or routine.  Important things - raising children and governing nations are examples that come to mind - never are.  Anyone who says differently has something to sell you'd ultimately be better off without.

Performance management demands the most from those with direct responsibility for pulling it off - not HR, but the prototypical line manager who must do her/his best with a process/form/timeline not of her/his own design.  However, help may be on its way.

Dick Grote, to my mind, is the preeminent guru on performance management - and one of the subjects of my recent Thought Leader interview series.  His new book How to be Good at Performance Appraisals is aimed at the audience of supervisors and managers, helping them to most effectively use whatever performance management system their organization has in place.  While it is not written with HR professionals and program designers in mind, I found it to be full of pragmatic and straightforward "real world" advice - something we can benefit from ... and perhaps a great resource for that next manager training session.

One of my favorite chapters was the one on goal setting: arguably the place where many performance management processes stumble and fail.  In particular, Dick calls out a number of popular goal setting techniques that are generally unproductive in actual practice.  A few examples and excerpts below-

Bad Idea #1 - SMART Goals.  As Dick points out, the overused and hackneyed SMART test is merely a mechanism for making sure that a goal statement has been phrased correctly.  But it is often fed to managers as the be-all and end-all of goal setting advice - in lieu of providing important guidance on the places they should look for goals, how to determine whether they reflect genuinely important accomplishments or how to make sure they are congruous with overall business strategy.

For example, consider the goal statement announced by President John F. Kennedy on May 25, 1961:

I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to earth.

How does Kennedy's goal statement stack up against the SMART test? Remarkably well...

Kennedy's goal was clearly SMART.  But was it wise?

The man-on-the-moon program provided great benefits: a huge psychological boost in the race for space with the Russians, the creation of lots of jobs, an increased focus on science and technology, a couple of moon rocks, and the development of Velcro fasteners and Tang powdered orange juice substitute.  But it also cost a huge amount - the best estimate is about $170 billion.  For that amount of money we could have built several universities the size of the University of Illinois, or provided a 1,200-square-foot house for every American living under the poverty line.  Would these have been better investments than shoveling $170 billion into a rocket ship and blasting it into outer space?

Bad Idea #3 - Requiring Percentage Weights for Goals.  Letting people know that some goals are more important than others, as Dick notes, is a good idea - but assigning percentage weights to goals tends to be less so, for a number of reasons.

First, it's impossible to accurately identify the relative importance of goals at a 5 percent level of granularity.  Should one particular goal be assessed as reflecting 20 percent of the total weight for all goals, or should it be 25 percent?  And from which other goal should the additional 5 percent be taken?  This argument isn't productive...

The use of percentage weights causes even bigger problems later, as it inclines the appraiser to turn the assessment of human performance in what is likely a dynamic and complex environment into an arithmetic problem rather than a matter of managerial judgment.

Thanks, Dick, for a book that looks beyond the HR crowd and provides expert guidance to the real owners and drivers of the performance management process.

(In the interest of full disclosure, I should reveal that I did receive a complimentary copy of Dick's book because he was kind enough to mention me in the Acknowledgments section.  But I would have purchased it anyway...)

Comments

[James]

Thanks for the post.

I am not sure I agree with his calling SMART goals a bad idea. The Kennedy example is a good example in why goals need to be SMART.

"Kennedy's goal was clearly SMART. But was it wise?" Isn't that the same as saying "was it relevant"? Therefore, did it truly pass the SMART test?

[Ann Bares]

James:

Thanks for reading and sharing your comment. While not claiming to speak for Mr. Grote, a few thoughts back-

First of all, one of the issues with the SMART acronyn is that there are many different versions out there. Far be it from me to say which is the right version and which is not. But the version Dick is referencing takes the "R" in SMART to mean "realistic", not "relevant". So take his remarks from that point of view.

But further, I don't think I agree that relevant is the same as wise. Dictionary.com defines relevant as "bearing upon or connected with the matter in hand; pertinent" and wise as "having the power of discerning and judging properly as to what is true or right; possessing discernment, judgment, or discretion." So a relevant goal is one pertinent or connected to the work at hand - not a tremendously high bar to cross. A wise goal is one which reflects discernment and judgment as to what is true or right - to my mind, a wholly different and much more challenging criteria.

At the end, I guess I'm still inclined to agree with Dick, that the SMART acronym is helpful in phrasing the goal well, but it does nothing to help you pick a goal that is smart in the first place.

Other opinions?

[Merle]

Disagree a tad. Approximate weighting percentages of performance objectives gives ees a rough idea of what is important to the company and how their accomplishments will be evaluated. They force supervisors to get specific as to how important various goals are and preclude surprises to ees when the evaluation is made and rendered. I agree that they should not be so specific that weighting them becomes unrealistic. The more objective the performance criteris are, the more valid and meaningful appraisals become.

Wonderful info from Ann and Dick.

[Wally Bock]

Provocative post, Ann, thanks. I agree with your key points. The SMART goals discussion is interesting because it may depend on which of the more than 900 combinations of words used in various smart goal combinations you're talking about.

I disagree, though, with your second "self-evident truth," "Performance management will never be easy, comfortable or routine." I've observed too many good supervisors for who it is exactly that. In too many organizations, we don't select supervisors for their willingness to do it nor do we train them in the techniques that work.

[Ann Bares]

Merle:

Thanks for the comment - I think we're more in agreement than not. Signalling which objectives are most important = good. Breaking that down by assigning unrealistically specific percentages = bad. We should absolutely strive to bring rigor and objectivity to the process, but at the end of the day a meaningful appraisal requires the application of human judgment.

Wally:

Only 900?

I find encouragement in your disagreement with the second truth - that there are supervisors out there who perform this key task well and are able to do so easily and comfortably. I am jaded by too many encounters with those who'll go to any lengths to avoid important but difficult conversations - glad your experience has shown you hope for the process!

[Van Hire London]

I appreciate your blog. It is clear & concise giving very nice meaning. Performance Appraisal is very important for employees development. There must be appraisals round in every 6 months in every organization. This is to be prioritized very soon. Thanks for sharing this article.