Why Performance Reviews Matter

Employee performance reviews; we love to hate them. Ask any of your friends and co-workers what they think of this annual ritual and you’ll receive a mixed bag of responses; anything from “It doesn’t matter,” to “We all have to fit within the bell curve.” I’m a believer that if practiced correctly, as part of an institutional performance appraisal system, performance reviews can benefit both employer and employee. Of course this depends greatly on what you think “correctly” means as we all have our own definition of both how to conduct, and receive a performance review.

The Upside:

As a leader and manager, I’ve always considered the employee review process an integral and extremely important part of my job. While there are other opportunities to be sure, what better way to consistently develop your staff on a personal level? I like to meet weekly with my direct reports and discuss their goals & objectives on a tactical level. “How are your projects going?” “Do you have any challenges I might be able to assist with?” Each month I’d schedule informal performance reviews and keep notes on our discussions: “If I got hit by a bus and killed tomorrow, your new manager will know of your work efforts to date.” These meetings served many purposes:

• Carved out specific dates/times for uninterrupted employee discussions.
• Allowed my employees and I to get to know one another better.
• Allowed me to consider employee actions from their point of view versus just my own.
• When the annual performance reviews were due, there should be no surprises.

I can honestly say when I’ve followed this formula closely, I’ve experienced some very smooth running departments. When I didn’t, well you know the rest.

The Downside:

There are many downsides to the performance review process if not done correctly. I’m not going to get into the various beefs I’ve heard like “I exceeded my goals, but I still didn’t get a raise,” as these types of complaints, while potentially valid, might be served best through a different type of discussion. I’m more concerned with connecting with my employees to ensure we are both in lock step with our departmental goals and objectives (G&Os). How can this be accomplished if we don’t meet regularly? If an employee is not acting professionally, or in a cooperative manner with other personnel or departments, it is my job to acknowledge, as uncomfortable as this might be, and provide a corrective course of action. And last but not least, a surefire way to kill morale within your department or organization, is not addressing poor employee behavior.

Consider the blog post of Bob Sutton. Mr. Sutton is the author of several books, my favorite being “The No Asshole Rule.” In brief, Mr. Sutton describes the recent scenario of an Ohio University professor, Dr. Bill Reader, an assistant journalism professor who, over the years, consistently received excellent performance reviews. Yet when it came time to approve Mr. Reader for tenure, it appears he was denied by the college’s dean, for bullying and other alleged volatile behavior. Why this supposed behavior was never acknowledged within past performance reviews for Dr. Reader is unknown. Regardless, this is an excellent, if not unfortunate, example of why performance reviews matter.

What do you think? Do employee performance review matter or are they simply a waste of time? If so, why? What is your formula for conducting performance reviews that work for both your employees and organization?