Introduction
DISPLAY 24.1 Leadership Roles and Management Functions Associated With Performance Appraisal
the organization may have of them. Performance appraisals also generate information for salary adjustments, promotions, transfers, disciplinary actions, and terminations.
In performance appraisals, actual performance, not intent, is evaluated.
None of the manager’s actions is as personal as appraising the work performance of others. Indeed, Kerr (2016) notes that next to disciplining an employee, performance evaluation is likely the most dreaded task a manager faces. Because work is an important part of one’s identity, people are very sensitive to opinions about how they perform. “According to Gregorio Billikopf, an adviser with the University of California, Davis, when a supervisor becomes an ‘expert’ on a worker’s performance, employees will often become resistant or even defensive. However, creating a positive environment, involving the employee in the process and discussing performance goals can help mitigate some of the challenges of performance evaluations”
(Kerr, 2016, para. 1).
Indeed, when used correctly, performance appraisal can be one of the greatest tools an organization has to develop and motivate staff. It can also encourage staff and increase retention and productivity; however, in the hands of an inept or inexperienced manager, the appraisal process may significantly discourage and
demotivate workers.
In addition, because a manager’s opinions and judgments are used for far-reaching decisions regarding the employee’s work life, they must be determined in an objective, systematic, and formalized manner as possible. Using a formal system of performance review reduces, but does not eliminate, the appraisal’s subjectivity. In addition, the more professional a group of employees is, the more complex and sensitive the evaluation process becomes. The skilled leader-manager who uses a formalized system for the appraisal is better able to build a team approach to patient care.
This chapter focuses on the relationship between performance appraisal and motivation and discusses how performance appraisals can be used to determine the developmental needs of the staff. Emphasis is placed on appropriate data gathering and the types of performance appraisal tools available. The performance appraisal interview is explored, and strategies are presented for reducing appraiser bias and increasing the likelihood that the appraisal itself will be growth producing. Finally, performance management is introduced as an alternative to the traditional annual performance appraisal. The leadership roles and management functions inherent in successful performance appraisal are shown in Display 24.1.
DISPLAY 24.1 Leadership Roles and Management Functions Associated With Performance Appraisal
Leadership Roles
1. Uses the performance appraisal process to motivate employees and promote growth
2. Uses appropriate techniques to reduce the anxiety inherent in the performance appraisal process
3. Involves employees in all aspects of performance appraisal
4. Is aware of own biases and prejudices in the performance appraisal process 5. Develops employee trust by being honest and fair when evaluating performance 6. Encourages peer review among professional staff
7. Uses performance appraisal interviews to facilitate two-way communication
8. Provides ongoing support to employees who are attempting to correct performance deficiencies 9. Uses coaching techniques that promote employee growth in work performance
10. Individualizes performance goals and the appraisal interview as needed to meet the unique needs of a culturally diverse staff
11. Role models risk taking in seeking feedback from subordinates and colleagues regarding own work performance to promote self-growth
Management Functions
1. Uses a formalized system of performance appraisal
2. Gathers fair and objective data throughout the evaluation period to use in employee’s performance appraisals
3. Uses the appraisal process to determine staff education and training needs 4. Bases performance appraisal on documented standards
5. Is as objective as possible in performance appraisal
6. Includes suggestions for growth in performance appraisals as well as recognitions of employee accomplishments
7. Maintains appropriate documentation of the appraisal process 8. Follows up on identified performance deficiencies
9. Conducts the appraisal interview in a manner that promotes a positive outcome
10. Provides frequent informal feedback and coaching on work performance throughout the evaluation cycle to promote employee success
Using the Performance Appraisal to Motivate Employees
Although systematic employee appraisals have been used in management since the 1920s, using the appraisal as a tool to promote employee growth did not begin until the 1950s. This evolution of performance appraisals is reflected in its changing terminology. At one time, the appraisal was called a merit rating and was tied fairly closely to salary increases. More recently, it was termed performance evaluation, but because the term evaluation implies that personal values are being placed on the performance review, that term is used infrequently. Some organizations continue to use both of these terms or others, such as competency assessment, effectiveness report, and service rating. Most health-care organizations, however, use the term performance appraisal, because this term implies an appraisal of how well employees perform the duties of their job as delineated by the job description or some other prespecified criteria.
An important point to consider, if the appraisal is to have a positive outcome, is how the employee views the appraisal. Indeed, many employees and even some managers view the appraisal process with mistrust;
perceiving either that it can be unfair or meaningless. Indeed, Akins (2015) notes that performance appraisals have received a lot of criticism over the past few years, particularly in terms of the potential for the process to be top-down, dishonest, and too focused on past performance. Management research, however, has shown that various factors influence whether the appraisal ultimately results in increased motivation and productivity.
Some of these factors include the following:
The employee must believe that the appraisal is based on a standard to which other employees in the same classification are held accountable. This standard must be communicated clearly to employees at the time they are hired and may be a job description or an individual goal set by staff for the purpose of performance appraisal.
If employees believe that the appraisal is based on their job description rather than on whether the manager approves of them personally, they are more likely to view the
appraisal as relevant.
The employee must believe that the appraisal tool adequately and accurately assesses performance criteria directly related to his or her job.
The employee should have some input into developing the standards or goals on which his or her performance is judged. This is imperative for the professional employee.
The employee must know in advance what happens if the expected performance standards are not met.
The employee needs to know how information will be obtained to determine performance. The appraisal tends to be more accurate if various sources and types of information are solicited. Sources could include peers, coworkers, nursing care plans, patients, and personal observation. Employees should be told which sources will be used and how such information will be weighted.
The appraiser should be one of the employee’s direct supervisors. For example, the charge nurse who works directly with the staff nurse should be involved in the appraisal process and interview. It is appropriate and advisable in most instances for the head nurse and supervisor also to be involved.
However, employees must believe that the person doing the major portion of the review has actually observed their work.
The performance appraisal is more likely to have a positive outcome if the appraiser is viewed with trust and professional respect. This increases the chance that the employee will view the appraisal as a fair and accurate assessment of his or her work performance.
Harrington and Lee (2015) suggest employees’ perceptions of the fairness of performance appraisal are strongly influenced by “psychological contract fulfillment.” These are the expectations between an employee and the employer and what each gives and expects in return from the other. In other words, employees’ perception of fairness in the performance appraisal may be contingent on how well they feel they were supported by their supervisors as well as the transparency that existed between the employee and the manager in terms of expectations (see Examining the Evidence 24.1).
EXAMINING THE EVIDENCE 24.1
Source: Harrington, J. R., & Lee, J. H. (2015). What drives perceived fairness of performance appraisal? Exploring the effects of psychological contract fulfillment on employees’ perceived fairness of performance appraisal in U.S. federal agencies. Public Personnel Management, 44(2), 214–238. doi:10.1177/0091026014564071
This study, administered by the U.S. Office of Personnel Management (OPM), surveyed approximately 1.6 million federal employees online to ask about their perspectives and experiences on a broad set of issues including perceived fairness and accuracy of their routine performance appraisals. The response rate of the survey was 46.1%, with 687,687 participants from 82 different agencies.
Fairness of performance appraisal was based on employees’ perceptions of whether their performance was fair procedurally. Accuracy of performance appraisal was based on whether their performance appraisal practices accurately or reasonably reflected employees’ job performance.
This study found that employees viewed the performance appraisal system more positively when they perceived it to be fair and accurate. Study results also suggested that employees’ perceived fairness may be contingent on how well they feel they were supported by their supervisors as well as their concern for the organization in which they work. The researchers also noted that providing vague and incomplete expectations to employees may lead to troublesome consequences and that managers can potentially overcome this problem by explaining verbal and written promises and acceptable behavior in detail as well as clarifying performance expectations. This allows the manager to minimize misunderstandings and provide clear expectations about
performance goals.
The researchers concluded that provision of supervisory support for employees may be “a low-cost way” of managing desired employees’ attitudes and behaviors in organizations.
A summary of the factors influencing the effectiveness of appraisals can be seen in Display 24.2.