Performance Appraisal Vs Performance Coaching

What is wrong with the performance review and how can we fix it?
Let’s take a look at the current system of reviewing employee performance, as well as what’s wrong with that system.
Typically an annual event, the review is founded on good motives. It stems from a desire to equitably rate employees based on their performance and potential. Managers often use this information to implement consistency. This intent is just fine, but the results often leave much to be desired. An annual performance review fails to produce the same results as performance coaching.
Painful comparisons. Some performance appraisals are comparative, ranking employees against each other based on performance. This encouragement of competition works for some groups some of the time—sales employees, perhaps—but it’s time to rethink this approach due to shifting work values, talent shortages and the need for innovation.
Lack of consistency. More and more managers consider performance appraisals a painful process that lacks consistency. They don’t like it, so they rush through the appraisal, squeezing what should be a 45‐ minute session into 5 or 10 minutes, and they often do not say what they mean. At their best, performance appraisals are supposed to give the employee a chance to offer feedback. This does not work if the manager is hurrying to get it over with, or if the employee is too stunned to offer any response.

Surprise, surprise. The person on the receiving end, hungry for feedback that he or she has not received often—if at all—might discover that the tasks he or she performed weren’t the ones the manager wanted done. Or she may discover that she left out an essential step that no one ever told her about. Or that something she had said in a joking manner months ago misled or offended another employee.

Performance coaching will help the manager address problems when they occur.

Bersin & Associates, experts in educating organizations about talent management, found that  these seven processes ensure the best performance management:

Goal setting
Alignment of performance goals with organizational goals
• Employee self assessments
• 360 degree assessments
Manager appraisals
Competency assessments
Development planning

Do you see the common threads of coaching and development?

Studies show that coaching  delivers major results, offering 150 percent greater return on investment than performance appraisals. You read that correctly——150 percent!

With that number in mind, coupled with the dread almost everyone feels regarding performance appraisals, why isn’t everyone coaching? Perhaps because they are not clear about how or when to do it.

In the performance appraisal process, the manager coaches in order to fix an issue after it has  been identified in the appraisal. But what if the system provided for such feedback from the  beginning

If we use feedback and development as tools to drive success instead of fixing  problems, we have success from the start. It’s an easier way to teach and a more positive way to  learn. And if such coaching takes place regularly, as it should, and is tailored to the employee and the specific job, it becomes part of the weave of our culture.

It is important for coaches to remember that one size does not fit all. Each employee is different,  and employees work differently. The better the manager/coach understands the employee, the  more effective the coaching and the results——more engaged and productive employees, and less turnover——will be.

Making the transition from performance evaluations to performance coaching can be an uphill battle. Using tool——such as assessments——to help identify behavioral tendencies of employees can help  managers learn how to coach well. Coaching not only changes the culture of an organization, but it  increases performance and leads to a significant return on investment.

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