Train Managers, Maximize Appraisals

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Jerry Gratton, vice president of people at 1-800-GOT-JUNK?, a junk removal service headquartered in Vancouver, British Columbia, Canada, is preparing to roll out a new manager training program for employee performance appraisals. "We're going to be teaching a new way of doing it. We're going to be getting people excited about performance reviews, if you can believe it," Gratton says.

If all goes well for the 180-employee company in developing the program for the managers, the plan is to create turnkey training that the corporate office can offer to its 200 franchisees.

Gratton is tackling a common business quandary: How can HR professionals get managers excited about the employee performance review process in light of all their other responsibilities? The key, say experts like Gratton, is to focus on the business case for performance feedback and to address managers' primary concerns—such as how to have the difficult conversations—as opposed to focusing on checking off boxes on administrative forms.

"Every part of doing a performance appraisal is hard," acknowledges Dick Grote, founder of Grote Consulting Corp. in Frisco, Texas. "Performance appraisals have a huge impact on human happiness. A performance appraisal is the primary determinant of how much money I'm going to make or how far in the organization I'm going to get. Organizations need to take it seriously. The hard part is having the courage to be honest about exactly how well a person has performed.

"We use the performance appraisal data to make a lot of important business decisions," continues Grote, author of How to Be Good at Performance Appraisals (Harvard Business Review Press, 2011). "If the company doesn't train managers in how to do a good job in assessing performance, then the data coming out of the performance appraisal system is inaccurate and it results in bad decisions in compensation, succession planning and reductions in workforce."

While most companies have an employee performance appraisal process, many do not train managers on how to conduct reviews. "Since the financial crisis, lots of companies are not doing the human capital leadership development investment and training that they used to do, which is unfortunate since 70 percent of their expenses are human capital expenses," says Ben Dattner, Ph.D., president of Dattner Consulting in New York City.

The Dilemma

Stephen Balzac, president of 7 Steps Ahead LLC, an organizational consultancy in Stow, Mass., notes that most reviews "are ritualistic exercises." If any training is imparted to managers at all, "it's in how to be a bookkeeper: 'If the employee accomplishes this much, give this rating.' Fill in little bubble charts."

Balzac says one telltale sign of a broken appraisal process is a large number of reviews filled with vague and unsubstantiated comments. "Recently, a company called me to help with a team that wasn't working. The performance reviews had vague statements [like] 'Bill is too passive.' What does that mean? You have to provide examples."

What to Cover

Nancy Libardoni, director of enterprise learning and development at Gilbane Inc., a real estate development and construction company with 2,000 employees based in Providence, R.I., recommends that HR professionals "Brainstorm where the process and steps are broken and focus on those. Don't try to fix the whole thing. Focus on a couple of things, and get managers to see the improvement."

So, what should HR professionals cover—or not cover—in performance appraisal training?

Avoid administrative details.

"Downplay the administrative or compliance aspect of employee performance appraisals, and play up the business case for doing it. We've used testimonials to showcase our strong managers to help others see the benefit of doing this. It has a powerful impact," Libardoni says.

Gratton adds, "Turn it into more of a conversation about performance" rather than an administrative chore.

Focus on how to have difficult conversations.

Use role-playing and other peer teaching techniques. "Use small group meetings to discuss having the difficult conversations. No one ever has trouble with a star," Gratton says. Once his company rolls out its new program, "We will be working through examples. They'll get help from their peers and one-on-one coaching, if they want it."

At Gensler, a global architecture, design, planning and strategic consulting firm with 3,500 employees, appraisal training includes scenario-based role-playing designed to answer questions such as "How do you have conversations with employees whose goals are not remotely aligned with the firm's and help them to focus on goals that align with the firm's vision?" says Janine Pesci, senior associate and firmwide director of talent development in Washington, D.C.

Explain common appraisal mistakes.

Dattner, author of The Blame Game (Free Press, 2011), recommends explaining how to avoid typical mistakes, such as when a manager evaluates an employee favorably because the person is similar to the manager rather than because of what the employee has accomplished.

Grote says other common errors are the "central tendency" (rating everyone in the middle) and the "recency effect"(basing ratings primarily on things that happened in the last month or so).

Remind managers to keep notes and be specific.

Doing so helpsmanagers "base their opinions on observable data. The magic phrase that renders any performance appraisal to be objective is 'for example,' " Grote says.

Dattner adds, "Feedback should be specific, constructive and based on more than one situation or event. In other words, it should be focused on patterns. It should be forward-looking and solution-oriented."

At Miami Children's Hospital, employees meet with their leaders quarterly and have "mini-reviews" to document accomplishments and pave the way for the annual review, says Janet Lara-Vital, the hospital's director of total rewards and wellness.

Discuss ways to deliver feedback.

Grote cautions HR professionals to avoid promoting the "sandwich approach," where the reviewer discusses some positive things, brings up some problems and ends on a positive note by talking about the employee's strengths. "The best people hate this approach. Your worst employees love this approach," Grote says.

"Good performers should walk out of their boss's office feeling good," he adds. "Let the good employees bring up the areas where they can improve." In contrast, "the small minority of poor performers should come out of the office not feeling good. The manager needs to say, 'I need to warn you.' Even if the person has done one or two good things, don't focus on the good things. The focus is on the need for immediate improvement. If he walks out feeling good, you haven't done your job."

Use role-playing to teach managers how to have difficult conversations.

Angie Strunk, vice president of Sheakley HR Solutions, an HR consultancy in Cincinnati, agrees that in manager training, the presenters should stress being consistent and honest and not "sugarcoating" the review.

The Logistics

Miami Children's Hospital has taken a three-year approach to appraisal training. The first year, trainers focused strictly on the philosophy of performance management, says Magy Barroso, PHR, director of talent management and engagement. "Last year, we focused on how to best have one-on-one coaching and career development. It was in a smaller group setting. This year, we deployed training that is more focused on aligning goal setting with the organizational strategy."The organization includes goal setting as part of its appraisal process.

A strategic plan such as the one used by the hospital can help HR professionals focus their efforts. HR professionals also need to consider these options on how to structure the training:

Online, classroom or blended.

Many companies offer a combination of online and in-person training. At CustomerContactChannels, a customer management outsourcing company with 4,000 employees in Plantation, Fla., manager training this year included a new online component in addition to in-person learning. Bob Tenzer, PHR, senior vice president of HR, said the online track covers the basics of the review process "such as how to form an individual development plan and understanding common appraisal mistakes." The in-person training "elaborates on each of the online topics and includes role-playing to help participants overcome challenges they may face in the field," Tenzer says.

In January, Gilbane will roll out new manager training to highlight goal setting and employee development. "We're using a few different venues," explains Libardoni, who worked with HR Operations Manager Michelle Patterson to embed smaller sessions into regular staff meetings. "We are having train-the-trainer sessions for HR director partners," Libardoni says, adding that they "are providing some webinars and videos for managers who want [access] 24/7."

In addition, Gilbane has upgraded its learning management system so that performance appraisal development plans trigger a list of course offerings through Gilbane University. "A list of core and elective courses pops up based on what employees want to work on," Libardoni explains.

Course length.

Two hours is a good guideline, experts say. "A refresher should be half a day at most," Balzac says, depending on how well managers are doing with their reviews.

Frequency.

"Training should be conducted with managers at least annually and when a new manager is hired or promoted," Strunk says.

At Rollins Inc., the parent company of pest control subsidiary Orkin, appraisal training is required for management trainees, explains Craig Goodwin, senior director of Rollins University, the company's corporate university, in Atlanta. Two self-directed modules on performance management must be completed prior to classroom training.

Timing.

Performance appraisal training works best when it is delivered immediately prior to the appraisal process. This is easier to do if all employees have the same appraisal date, rather than giving appraisals on employment anniversaries.

"By having a common review date for all employees, we can focus on creating training opportunities at a certain time of the year," saysMichael Kushner, vice president and chief talent officer of Miami Children's Hospital. The hospital's two-hour in-person training starts in January, and performance appraisals are conducted in April, explains Loubna Noureddin, director of staff and community education.

When appraisals are done at the end of a calendar year, Grote recommends scheduling training in "two half-day sessions. In January, I would have a half-day session focused on goal setting and motivating good performance. Then in October, I'd have the second half, which would concentrate on how to do a good job of assessing performance and how to have a good performance appraisal discussion."

In-house or consultant.

Because of the frequency required, it is beneficial for HR professionals to be able to deliver appraisal training in-house. It may be advisable, however, to bring in an outside consultant to kick off a new approach or to breathe life into a stale program. Be aware, though, that consultants can cost between $3,500 and $16,500 per day.

Not an HR Process

To develop and implement effective learning intervention for performance reviews, HR professionals need to have a deep understanding of the business, know the performance requirements placed on managers with regard to performance reviews and track how the learning strategy links to business results, Goodwin says. "Training for performance reviews should be evergreen, ensuring the program is current and the right skills and knowledge are being provided for each step in a manager's career," he explains.

Libardoni makes the distinction that a performance appraisal is a management tool, not an HR process: "If managers use it correctly, then it is a motivational, leadership tool."

The author, a former HR generalist and trainer, is a freelance writer in Wixom, Mich.