4 Steps for Conducting a Painless Performance Appraisal

By: American Management Association

Nearly everyone dreads them. Performance appraisals are challenging—to both managers and their team members. So, why do companies continue to practice this anxiety-inducing formal exercise and repeat it annually, if not biannually or even quarterly? Despite their notorious reputation, performance appraisals serve an important two-fold purpose: to help the manager determine the value and productivity an employee contributes to the organization, and to help employees overcome their weaknesses, develop their strengths, and progress in their career.

No matter what template or process an organization uses, the difficult work of conducting a performance appraisal falls squarely on the shoulders of the manager. After thoroughly assessing a team member’s overall capabilities and specific results, achievements, and shortfalls over the past year or months, as well as their potential for growth and success moving forward, the manager must then sit down and discuss it all with the employee, one-on-one and face-to-face, whether in person or virtually. It’s no wonder both managers and team members resist or procrastinate when it comes to carrying out this company-mandated process.

A world leader in professional development for nearly a century, American Management Association (AMA) is committed to making those difficult performance appraisal discussions easier for managers and not so dreadful for employees. For starters, here’s a four-step process that every manager can apply to any employee review:

1. Let the employee know what to expect. Open by explaining the purpose and process for the performance appraisal discussion. Place a priority on constructive feedback and strategies to support the employee’s development, rather than harsh criticism and warnings.

2. Start with the problem. First, focus on your concerns about the team member’s weaknesses. It might be something as simple as, “Lately, I’ve noticed you’ve been missing deadlines.” Why begin with a problem? Because it’s uncomfortable—so get it over with and move on. Once the worst is out of the way, the employee’s tensions will be relieved. For example, if the person keeps anticipating criticism, they might not even hear it when you praise them.

3. Come up with a solution together. Ask the employee for their take on the problem. Then help them come up with a workable solution. Talk it through together. Share your insights and highlight the development areas the employee should work on—for example, “Working on your time management skills could help things go more smoothly.” Aim to incorporate goals that are SMART: Specific, Measurable, Achievable, Relevant, and Time-Bound.

4. Recognize their strengths. End the discussion by talking about the team member’s strengths. Give specific examples—for example, “You did an excellent job with the marketing proposal last month.” Acknowledging what the person does well is likely to motivate them to want to do better, instead of leaving them feeling demoralized. Wrap up the performance appraisal on a positive note of praise and encouragement.

This four-step process is meant as a framework. Every manager should develop their own style. Try other approaches and decide what works best for you and your team. Practice makes perfect—and with it, performance appraisals really can be painless. And remember: A performance appraisal discussion provides managers with an opportunity to call attention to a team member’s achievements and affirm their future potential.