For many managers, end-of-the-year activities include completing employee reviews as part of a performance management system. Giving year-end feedback is something that some managers view as “checking one more thing off the list.” Some employees view the activity as a “necessary evil.” Often, this is a missed opportunity to start the new year with a bang—especially with high performers. In 2011, the high performers did most things very well; yet, managers often feel compelled to give “developmental” feedback. Managers feel they aren’t doing their job if they can’t find something that is less than awesome. As a result, high performers leave the review slightly miffed that the manager documented an obscure area of improvement just to ensure the review wasn’t too glowing.

I am going to suggest a very radical approach to performance reviews for high performers. Focus on all they did well and … end the review. Resist adding the developmental feedback—unless it is actually a critical success factor.

High performers are high performers because they self-analyze and independently seek to improve. Ask them what they would like to improve in 2012, identify how you can help them, and conclude the review without saying anything negative. Discuss personal growth and development in 2012, but frame it from a perspective of what they want to accomplish and not from the often misused perspective of “no one is perfect,” “we don’t want them too big for their britches,” “everyone has the ability to improve,” etc.

While some of those axioms are true for some people, I believe that high performers will appreciate managers identifying how they can help them move in the direction they want to go. Try ending the review with a Merry Christmas, Happy New Year, and keep up the great work in 2012.

Jennifer Rufatto is a consultant at FlashPoint. She focuses her consulting in the areas of workplace learning and leadership development.

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I recently came across a couple of articles published by the Society for Human Resource Management, both with the same theme—how performance reviews are ineffective and put organizations at risk (rather than offering legal protection, as most people think). The articles, both written by employment attorneys, highlight the following flaws: 

• Supervisors are not prepared to conduct the reviews
• Supervisors are not honest in their feedback
• The feedback isn’t objective or timely

The authors point out that in their long legal careers, they’ve found that performance reviews most often work against employers and often serve as the plaintiff’s key piece of evidence. One author was forthright—throw the review form in the recycle bin!

Advice such as this seems counterintuitive to most HR professionals and refutes what most of us have learned and advocate. When I read the articles, I had to pause and consider how to reconcile the two positions.

The key reasons the authors list for why performance reviews fail boil down to a common element—supervisors don’t have the skills they need to conduct them. I’m still convinced that a well-developed and well-executed performance review serves a useful role if the organization invests in the process and in preparing supervisors to carry it out. Some areas to focus on include: 

• Creating a well-thought-out form that not only promotes open and meaningful dialogue around the employee’s performance but also provides sections to spell out yearly goals and development plans.
• Outlining a process that includes quarterly update meetings, encourages regular feedback, and involves both employees and supervisors.
• Training supervisors so they understand the review process and tools and how to use them effectively.
• Regularly evaluating completed forms, asking questions, and coaching supervisors on how they can better carry out their reviews.

Sources:
Janove, Jathan. “Reviews—Good for Anything?” HR Magazine, June 2011.
Keyes, Judith Droz. “The Legal Case for Eliminating Performance Reviews.” SHRM Legal Report, April 2011.

George Hanlin is a consultant at FlashPoint.

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Here it is again—that wonderful time of the year! No, I’m not talking about the holidays (though they are indeed pretty terrific), but instead the time when many of us conduct annual performance reviews for our employees and provide merit increases for the next year.

If you’re a manager and are budgeting for merit increases, FlashPoint has helpful data for you. Julie Bingham, our senior consultant, regularly keeps up-to-date with the latest compensation-related research and trends. Julie’s a member of WorldatWork, the national compensation and benefits professional association, and she recently received results from WorldatWork’s 2010-11 salary budget survey:

• The national average merit increase in 2010 was 2.5 percent, and the national average projected 2011 increase is 2.9 percent.
• For the central U.S., the average increase in 2010 was 2.5 percent, and the projected 2011 increase is 3.0 percent.
• For Indiana, the average increase in 2010 was 2.5 percent and the projected 2011 increase is 2.9 percent.

According to Julie, this data includes those organizations that offered or plan to offer no increase (that is, it includes zeros), and if you exclude the zeros, the data comes in slightly higher.

Julie also notes that other sources, including the 2010-2011 Mercer U.S. Compensation Planning Report, indicate similar trends.

Earlier this year, Julie wrote an article on regaining control of your compensation programs, with six steps you can take to assess and adjust them. As you consider your merit increases and other compensation-related issues in the new year, it’s a great resource. You can find it here.

Meanwhile, best wishes as you wrap up your year-end HR projects (including those performance reviews—mine is December 15) and as you prepare for 2011. And amid all the hoopla, don’t forget to take time to enjoy the other activities the season has to offer! Happy holidays!

George Hanlin is a consultant at FlashPoint.

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