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You might not even realize you’re making mistakes when you're doing these appraisals. But you most likely are. Having tough conversations may be hard, but biases are real and one to avoid at all costs.
Here are five performance evaluation methods you might be using but need to avoid when doing reviews.
1. Feedback sandwich
A common mistake, this method involves starting off feedback with praise, dishing out the negative news, then sugarcoating it with more praise.
Something similar to: “We value your work, but you’re not meeting the production level. However, you’re a valuable employee to us.”
Dishing out the news this way only makes you sound insincere. For better results, just give employees the bad news without the fluff. At the end of the day, feedback during the appraisal process is meant to help your employee improve their performance.
2. Recency effect
“What has this person done lately?”
This is a question that managers ask themselves, and the answer is the result of a recency effect — a psychological theory that involves using recent events to analyze past performance.
When review cycles have a 12-month lag, it’s easy for managers to focus on what’s fresh. But this brushes aside any positive or negative behavior that has gone unaddressed.
That’s why it’s important to keep a track in an objective way of what all work has transpired over the past, to avoid this bias.
3. Horns and halo effect
A Princeton study had participants rate a man in a suit with a Cornell degree versus a man in casual clothing with a nondescript college degree.
The participants rated the suited man as more competent than his casual counterpart.
The experiment demonstrated the Horns and Halo Effect. Managers assume that an employee is naturally good or bad at their job based on some subjective measure.
This can be prevented by basing performance reviews on data instead of opinion. How many sales has this person closed in one month? How many clients have they lost in two months?
This deters any subjective impression from obstructing the actual review.
4. "Like me" bias
Studies have found that people prefer to associate with others that are like themselves.
This mentality can stem from something as serious as racial prejudices to disliking how an employee styles their hair.
In the end, it has the same outcome: Managers believe that people who aren't similar to them can't perform their jobs well.
5. Central tendency error
The last performance appraisal method to avoid when managing employee performance is one that involves team evaluation. If a manager rates a group of people as average performers, then they're more likely to evaluate individual employees as average as well. The flaw in this method is that under-performers are overvalued and overachievers are undervalued.
A great boss needs to customize each individual review. Individual reviews are critical if you're looking to evaluate an employee's performance. It's easy to accidentally use one of these methods. You might not even know you're doing it. But when you’re conducting reviews, keep in mind that employees can handle negative feedback as long as it's honest and data-driven.