Assessing the Assessments: Which Performance Review Style Suits Your Company

Every company needs an assessment style that suits its needs. However, choosing one can be difficult. Every approach has its strengths and weaknesses. Deciding which is right for your company should be a matter of careful analysis, rather than simply selecting what’s trendy.

Identify Which Factors You’ll Assess

Although every system is different, figuring out which dimensions to assess is always the first part of choosing a review process. One dimension is almost certainly some form of quality check. Besides ensuring the employee’s quality of work, other dimensions will likely be related to the most important characteristics for success in your business. The usual recommendation is that you measure between four and six dimensions. Fewer and you might be missing important qualities; more and you’ve probably included irrelevant metrics. For example:

  • A sales firm will likely use dimensions such as personal interaction skills, percentage of closes, and average sale size. All these dimensions are key for a good salesperson, but will likely vary among staff members. In some cases, they can also be measured, though it may take a bit of imagination. For instance, the metrics for personal interaction skills could be measured by the number of appointments a salesperson sets or a low number of customer complaints.
  • A technical firm specializing in solutions for unique problems will require a very different skill set. While they’re as interested in quality work as anyone else, they’re likely to assess dimensions such as innovative application, technical knowledge, and technical communication. The company will value quality but prize technical knowledge, the ability to use that knowledge creatively, and an employee who can communicate his or her solutions effectively without losing precision or the audience.

Develop a Measurement Process and a Reference Point

Once your company has decided on the qualities to measure, they need to be defined. A measurement system is no good unless you know what you’re evaluating in the first place. These definitions should be as specific and concise as possible.

After determining which criteria to use, you must decide on a rating method – which is where the process becomes interesting. You need a rating scale that has enough nuance to differentiate between employees, but not one so complex that managers (or other raters) have a hard time understanding it.

Perhaps the easiest way to divide rating method types is by who is chosen to perform the rating. One type is self-assessment. While this approach is probably not sufficient in and of itself, it can provide useful data. Like any other review, self-assessment requires firm standards and precise definitions. The employee should weigh his or her performance against these standards as objectively as possible.

Combine Multiple Rating Systems to Eliminate Biases

Discrepancies between employee self-evaluation and actual performance can give insight into the employee’s mental processes. If a worker genuinely believes his or her work is at a particular level, whether the rating is believed to be too high or low, be ready with an explanation. This involves giving examples of when the work met the graded level or fell short, highlighting inadequacies or excellence. You should also ask him or her to explain why another rating may be more accurate.

To minimize this kind of disagreement, self-rating systems should never stand alone. There needs to be some additional method to ensure accurate assessment. The most common form of rating, whether as a check or by itself, is a managerial rating system. These can be as rigidly defined as a list or as fluid as an essay rating system. Consider the following factors when planning this kind of approach:

  • Rigidly defined systems have the benefit of simplicity. There’s little room for bias when the dimensions are phrased correctly, which is also one of the problems; every dimension has to be defined clearly to accurately measure what’s intended. These systems may also be overly precise. Different divisions of the same company may require entirely different measuring tools, which complicates the process.
  • The essay rating system is one of the oldest performance assessments currently used. Essays allow for the contextualization of behaviors, but they’re also extremely prone to bias. In the modern business world, the main place for essay systems is as an adjunct measure to justify a less subjective rating method. When essays are required, they should be required of all ratings to avoid central-tendency bias.
  • Perhaps the most common system currently used is the quality rating scale. This method allows you to differentiate performance and give meaningful feedback on improvement. The usual method is to center the scale at “average” performance and have multiple points above and below this central measure.

Issues With Rating Scales

The main problem with rating scales is that they incline towards extremes or the center. Tending towards extremes occurs when the scale is incorrectly weighted, so a majority of employees will either perform particularly well or poorly. Central tendency occurs when the scales are weighed so loosely that it’s almost impossible for an employee could get a score so high or so low. This error can also happen when giving an extreme score requires a great deal of justification from the assessor.

Employee ranking systems also fall within the rubric of manager assessment. While these types of assessment allow you to identify the top performers in your division, they can also generate confusion when applied inappropriately. Sometimes employees have similar levels of skills, so differentiating between performance levels is meaningless. Other times, the bottom performer in one division can outperform the top employee in another.

Implementing 360 Degree Reviews for a Bigger Picture

360 degree reviews add the perspectives of an employee’s coworkers, subordinates, and customers to the feedback of his or her manager. When you use this method, these individuals typically use the same form as the manager does. With that in mind, the form needs to be clear and easily explained to avoid confusion.

Above all, take care when choosing an assessment method. This can be one of your most important tools for recognizing employee excellence or identifying individuals who need a little more help. Recognize the importance of the right method, and don’t be afraid to change it if it stops working for your company. You can also point workers in the right direction with these self evaluation paragraphs.

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