Feature

Why appraisals leave both sides unhappy

Sudipta Dev analyses why it is necessary for an effective performance appraisal system to involve continuous feedback throughout the year.

Employee performance appraisal is a critical issue for any organisation. While appraisals are a necessary part of the system, the truth remains that it is a process that often leaves both sides unhappy. The mismatch between expectations and delivery, combined with the formality of the process leads to dissatisfaction for the appraiser and the appraisee. There are even a few who question the effectiveness of a formal appraisal system, considering the many complications that arise. Constant feedback to the employee about his performance and expectations is more effective in meeting organisational and individual goals, instead of a day or two in a year to apprise him of the expectations.

Few organisations are able to understand the flaws in the appraisal system and do something to rectify the problems. It is a known fact that few line managers are good appraisers, they need training in how to do the job well and handle the situation with sensitivity. It is this lack of understanding which sometimes leads to bad blood during the appraisal process. There should be no nasty surprises for the employee.

"Objective assessment needs to happen with real examples to avoid emotionalising of this discussion. Ongoing feedback is essential to help monitor progress on goals and to reinforce them as realities change" - Chetan Shah Managing Director Synygy India

The problem stems from mis-match of expectations, from both sides. Chetan Shah, Managing Director, Synygy India, agrees, “It is all about expectation setting and continuous communication. If the manager and the employee are continuously monitoring the progress, a performance appraisal discussion should not be a surprise to either party.” He believes that it only becomes a more formal way to document these conversations and if these interactions are not happening, then there is a surprise element which many times lead to unhappiness on both sides. Furthermore, many times it ends up becoming a defensive conversation—a manager defending their appraisal, and the employee defending their contributions and so the positive elements are never discussed and over-looked.

This constant communication is to a large extent depended on individual personalities in how openly and honestly they are providing feedback and how an individual is accepting and listening to the feedback. Consequently, if both parties are not coming to an appraisal with a positive attitude and willing to listen to each other, there will be unhappiness. “Focussing on the achievements and concentrating on the positive elements is very important. Objective assessment needs to happen with real examples to avoid emotionalising of this discussion. Ongoing feedback is essential to help monitor progress on goals and to reinforce or adjust them as realities change,” adds Shah.

It is also true that the success of the appraisal system depends to a large extend on the culture of the organisation. “The appraisal activity has a lot to do with the organisation’s framework of performance review and is a reflection of the prevailing organisational values as well as the sensitivity with which it is conducted,” says Rajeev Gupta, HR Director, Rapidigm (India), a Fujitsu Consulting Company. Gupta points out that the goals of annual appraisals are not only to know the individual’s performance that has impacted the organisation’s, but also how the entire performance management system supports the desire to create a customer-serving, motivated, accountable, reliable, creative, dedicated, and happy workforce. And if done in the right spirit, annual performance reviews are looked forward to by both the appraiser and the appraisee.

Complex process

There are many reasons why managing people performance and measuring productivity is a complex process. Gupta believes that if the targets set at the start of the performance cycle are not clear, they result in ambiguity; if too well defined they can act as blinkers and result in the ‘outside in’ approach, rather than ‘inside out’—both resulting in scope for disagreement. “This can be avoided if the organisation puts in place the right performance targets, good measurement tools and demonstrates consistency and fairness in its approach while providing systemic support whenever required,” adds Gupta. At Rapidigm the associates are fully aware of the parameters used to evaluate their productivity. Apart from a robust system in place and periodic tracking, the company invests a great deal in the continuous sensitisation of line managers who are the key drivers of this process.

Constant interaction vs formal appraisal

The question is: if an ongoing dialogue with an employee is more effective in improving his performance than a six-monthly or yearly appraisal? “Definitely,” asserts Shah. According to him one of the weaknesses of any appraisal system is the lack of frequency with which progress and success are measured and tracked. “You are most likely to accomplish the goals you set if you review them at regular and frequent intervals as a part of your normal planning process. The discipline of the daily review is a powerful goal accomplishment tool and if you do it daily, it will take just a few minutes and will have much more positive results.”

It is debatable if a formal appraisal process is really needed, or is it better to do away with the system. Speaking in favour of such a system, Saket Agarwal, COO, Cellebrum, states, “The prime objective of having a formal appraisal system is to make the appraisal process more transparent. While an employee may end up filling appraisal forms before he/she actually sits across the table with the management for an appraisal, it definitely embeds a sense of responsibility and accountability in the employee. Moreover, to a great extent, it sends out a clear signal that you cannot take your responsibilities lightly and you will be recognised if you deserve to be.” This apart, a formal appraisal system allows an organisation to clearly define expectations that it has from an employee and helps analyse an individual against those expectations. In fact, it still is one of the most-used methods to appraise an employee on the basis of the objectives laid down by the employer.

Agarwal agrees that ongoing dialogue ensures that any issue, concern or problem is dealt with at the right time with the right approach instead of waiting for the dissatisfaction and distress levels reaching greater heights. However, he justifies that a six-monthly or annual appraisal is a formal process of recognising employee efforts and contribution to the organisation. He believes that it is a combination of a regular dialogue and formal appraisals which we feel work the best and help in maximising an employee’s potential to his best.

At Cellebrum, it is ensured that the employees are never left unheard which can be a cause of unhappiness. “We are of the firm belief that only contented employees can work ardently towards achieving organisational goals,” says Agarwal. Hence, the company charts the organisational and individual assessment in an effective manner, thus, leaving no room for dissatisfaction to either side.

Every organisation needs to device its own methodology to find the best process for appraising its employees. This of course depends on the culture of the organisation and its goals. “Broadly defined, the best practices would involve an ongoing process of planning, goal-setting, feedback and performance review. Manager and employee should mutually agree on the goals and the measurement criteria,” states Shah. Training need analysis and efforts made by the organisation to bridge the skills gap is necessary. The performance appraisal, insists Shah, should be used as a tool to build trust and open communication between managers and employees, rather than as a punitive exercise aimed to highlight employee inadequacies.