Following the advent of the HRD era about three decades back, performance management came to occupy a central place in the management of people. And for obvious reasons, this has also remained the most sensitive and contentious aspect of people management at work. Managers and the managed alike are often disillusioned with the process, despite enormous amount of training and coaching that goes in to this area. Unfortunately, in many organizations the HR function and managers have remained mute spectators most of the time, and occasionally have come forward to referee between the contending parties.

An Uneasy Look at Performance Appraisals

MIT Prof Douglas McGregor of Theory X and Theory Y fame wrote a Harvard Classic article titled An Uneasy look at Performance Appraisal in the Sep-Oct 1972 issue of HBR. He provides some deep insights into why the appraisal process, long recognized as a very effective and powerful employee development tool, is resisted by the boss and the employee alike. He attributes the manager resistance to

a) A normal dislike for criticizing a subordinate and having to argue about it,

b) Lack of skill needed to handle the (appraisal) interviews, and

c) Mistrust of the validity of the appraisal instrument

Scott Adams of the comical strip Dilberts fame has this to say about performance appraisal and its objectives. While the professed objectives are a) performance planning, b) employee development, and c) culture building, the objectives in reality become the following: a) make people work like a Roman orchard slave, b) obtain a signed confession of all employee crimes against productivity, and c) justify a pathetic salary increase! While Scott Adams’ observations may sound like an extreme case and should be viewed with the usual sense of sarcasm that Scott’s writings are known for, we cannot rubbish the same since many employees often tend to carry such perceptions.

Simple Rules for Performance Management

John Humble of ‘Management by Objectives’ fame has reduced the spirit of the Performance Management in five simple bullets. If understood clearly and well, these can prove to be powerful guidelines for managers and employees alike in deriving the best value out of the appraisal process. These are expressed as ‘Five Needs of Every Employee’ and apply as much to the corner office CEO as it does to the front office receptionist!

Five Needs of Every Employee

1. Agree with me about what is expected of me
2. Give me the opportunity to perform
3. Tell me how I am getting along
4. Give me the guidance where I need it
5. Reward me according to my contribution

If managers understand these simple mantras and fulfill these needs, there can be significant performance growth and productivity at work, besides removing the undesirable unpleasantness the appraisal system is often perceived to be associated with. Let us understand each of these five needs in a bit more detailed manner.

Agree with me about what is expected of me: There can be no argument against why every employee should know with reasonable clarity what is expected of him or her. This is fundamental to planning how employees can contribute to the overall goal of the team. In simple terms, the goal-setting phase of the performance management should satisfy this need. It needs no over-emphasis that the business environment of today is a lot more dynamic and change has become the only constant. Under this circumstance, goals and tasks need continuous adjustments. But then adjusting the goals on a real time basis is very different than not setting any goals at all under the guise of continuous change. It is unfair to evaluate an employee performance without ever sharing with him or her what is expected of them from time to time.

Give me the opportunity to perform: Again, a very reasonable expectation from any employee that he or she should have the right tools, resources, and a hassle-free environment to perform. While the employees can handle a lot of this themselves, a discerning manager will always be looking out for what comes in the way of an employee delivering his or her best and do everything the manager can to unblock the obstacle. This is contrary to the ‘swim or sink’ philosophy many managers tend to sport and display at work. Creating a supportive environment is the first and foremost responsibility of managers who seek the best performance from their teams.

Tell me how I am getting along: Traditional performance management process will call this ‘continuous feedback’. And this is the most shirked responsibility among most managers. Surely enough, providing feedback is not a child’s play. It requires knowledge of what the employees are doing, how well they are doing it, where they lack competence or confidence, and how managers can help employees gain both these so their performance in the next round would be much better. Most managers approach the feedback so very casually and the result is that it backfires, often weakening these managers’ will to do a good job next time around! Feedback is more often misunderstood and delivered the wrong way. Following some simple guidelines and practice will make it most rewarding both for the employees and their managers. More recently, the world-renowned executive coach, Dr. Marshall Goldsmith advocated an even more exciting approach that should take the anxiety out of most managers. He recommends trying ‘feed forward’ instead of ‘feedback’. The same data that managers use for feedback can be used for delivering feed forward, but the difference in feed forward is that the manager is not obsessed (or at least perceived by the employees as obsessed) with what the employee did not do, but is focused on helping the employee avoid those flaws in the future.

Give me the guidance where I need it: This has two dimensions. Firstly, employee confidence, competence, and comfort in delivering the goals will fluctuate from high to low from time to time. And the employee need is that the supervisor provides the requisite handholding and guidance where required. Secondly, and more importantly, this also implies that managers should lay off their interference where it is not needed. Some managers have enormous capacity to micromanage in the garb of offering help. This increases the employee anxiety and affects the performance rather than offering any help to the employee. Smart managers should not only know where to intervene, but even more importantly where not to intervene.

Reward me according to my contribution: This completes the performance management cycle. Recognition and rewards (both monetary and non-monetary) become important reinforcement mechanisms and employees need this routinely. As research in this area has indicated, since well over a few decades now, most employees need a word of appreciation and not necessarily a load of money! And as common sense dictates, there is no upper limit as to how much appreciation a manager can offer to his or her employees. Sadly enough, managers do not leverage this motivation tool enough as they suffer from 'too much appreciation will spoil the kid' mentality.

Increasing Importance of Performance Management
When you read about organizations downsizing their workforce and attributing it to their performance management practices, what comes under scrutiny is how sound is the appraisal process and how well trained are the managers in doing a good job of this. If you are a conscientious manager and want to ensure that your employees’ interests are taken care of and that they are not subjected to humiliation and unjust termination under the guise of performance management, you owe it to your employees to fulfill their five needs. It is fairly simple and straightforward. And you can avoid the guilty conscience of having perpetuated any unintended damage to your people by following the foregoing principles.

The author is Executive Vice President & Chief People Officer, Symphony Services