I am sharing my thoughts with fervour on this topic because employee performance appraisal practices have become a bone of contention between many managements and staff of corporations in the current era. Or to put it plainly, performance appraisals, more often than not, sprout out controversial debates between superiors and subordinates.

But first, let me narrate a bit of history about my past experiences pertaining to how I was "assessed" (there was no appraisal format in place yet at that time, so I refrain from using the word "appraised") by my superiors during my attachment with an international large financial service business institution.

In 1980, I was appointed to head a branch after joining the corporation less than two years. Being an upbeat young manager, I strove all out to support the sales force there in their business endeavours. My branch won the accolade for the highest new business growth ratio in that year, with a score of above double over the previous year. The top sales manager by new business was from my branch.

I thought a fat incentive would come my way when a key officer (not my original direct superior who had just resigned) from Kuala Lumpur head office drove 80 km to personally deliver the envelope enclosing my reward letter. An utter dismay when I read it - only a nominal increment and no incentive bonus. And a hard whammy blew my face by the verbal reply to my question why I was given a negligible increment despite the vibrant business growth. He said I was supposed to control the sales people according to the requirements of the management, not be pally with them; and my main role was in administration of the branch, not sales promotion. Had I been informed earlier about this presumed role? No! Had I been advised what type of control I was supposed to enforce? No!

True or not, I did not really know, but suspected that I was deemed being aligned to my previous direct superior who fell out of favour from the top management. That was the example of the old days when recognition to subordinates laid very much on the whims and fancies of superiors without resting on a structured procedure based on specific facts and figures. I would have left the corporation after this disenchantment if not for a speedy change in my line of reporting to new bosses who manifested better organised management skills.

Employee performance management systems or formats crept into the scene in the same corporation around the late 80s. The documentation then was simplistic. Interviewing subordinates occurred only at year-end in order to grade them. Both superiors and subordinates had to sign as acknowledgement that dialogues were held at that point in time. A subordinate could tick in the form whether he agreed or disagreed regarding the appraisal grade and write his comments (if he disagreed) but his superior would normally stick to the stand without wavering once already decided upon.

Let us come back to the current era (the time of my piecing up this article). Appraisal processes have become more detailed. Some corporations have initiated counseling sessions for under-performers. Yet, I still hear of grouses from individuals that their respective company's appraisal system lacks objectivity and specificity.

Some corporations adopt appraisal methods which have been subjects of debate of whether such were formulated on intent of fair play, or otherwise, to employees. The formulae were founded on certain assumptions that are also debatable.

Many corporations now adopt the premise that top performers constitute 20 per cent of their manpower force, those just meeting expectations (the average performers) make up 70 per cent, while the remaining 10 per cent are considered the wash-outs (or slight variations in the ratios). The premise somewhat entails subjective grading of overall employees, not according to pure objective means. In essence, such actually caters for a "forced ranking system of appraisal".

Simple illustration: Presume a department consisting 10 subordinates under one head (appraiser). For illustration purpose, let me refer to the scale of 1 to 5, used by a few corporations I know, for rankings (1 for outstanding, 2 for good, 3 for average, 4 for below average, 5 for poor). Also presume the actual initial rankings of the 10 subordinates based on their achievement levels against their assigned goals are as below:

                                                    RANKING           1        2        3        4        5

NO. OF INDIVIDUALS IN ACTUAL APPRAISALS       1        2        4        3        0

(Note: Rankings1 & 2 are the top 20%, 3 & 4 are the middle 70%, 5 is the bottom 10%.)

If the formula must be strictly complied with, the actual initial rankings will be subjected to the "forced through" adjustments as follows:

NO. OF INDIVIDUALS IN ACTUAL APPRAISALS        1        1        5         2        1

Obviously, two subordinates are "compromised" by the forced downgrading - one person from ranking 2 down to 3, another from ranking 4 down to 5. Question: Who among the two individuals in the preliminary ranking under category 2 should be relegated to one step down to category 3? Likewise, who among the three individuals in the preliminary ranking under category 4 should be pushed out to the lowest category? And on what criteria to determine who should be "compromised" for the sake of maintaining the formula? A very subjective exercise, is it not? Would such an arbitrary downgrade move be fair to the two affected subordinates?

I have heard of cases whereby some employees were informed by their immediate supervisors their initial appraisal ranking but later downgraded after amendment by the higher echelon superiors or human resource side. No wonder debates and grouses occurred. Imagine the indignation immersed in these employees. Once done and scripted in record by an immediate supervisor with the knowledge of the subordinate, the appraisal is rightly deemed sealed. Any downgrade amendment thereafter is "unconstitutional".

I can guess one likely rationale why more corporations want to adopt this kind of appraisal practice - for manpower expense containment. When the bulk of appraisals are within the average scores (70% ratio), overall increments and incentives will also fall in the average quantum. But if more than 20 per cent of the employees get high scores, the corporations would have to fork larger manpower pay-outs. Perhaps, that is why they prefer a forced balance adjustment system? I am entitled to my personal views, so is everybody else. Readers, please feel free to share your thoughts if you disagree in this respect.

At this juncture, I like to pose a few questions for your thought:

Presume a corporation is quite successful in putting the right people in the right jobs with regard to its overall manpower, would not there be higher ratio of performers in the above average categories? If yes, why is the need to force some to lower rankings? Would it not be fair to accord recognition in line with actual objective appraisal rankings? Would not objectivity be more practical than relativity?

Managements may contend that the forced ranking appraisal method encourages healthy competition within the flock. But if a flock at large is of average and below quality, how much can internal competition lend weight in enhancing productivity?

So be it corporations with more outstanding and above average performing employees have to foot higher remuneration expenses. Bear in mind manpower represents the most vital resource of any business organisation. The people in it can either make or break the wholesomeness of the organisation. Put it this way: When some employees in a corporation feel they are appraised unfairly, they will be demoralised; they will become passive in attitude; they will transpire negative vibes to peers around them. Negative vibes will lead to an ultimate decline in general productivity and efficiency.

I also heard of practices whereby subordinates were asked to fill up appraisal forms, i.e. preliminary self-appraisal, which then were reviewed and revised by superiors before arriving at the final conclusion. Although not outright wrong, yet it may not be the right approach. My reasons are;

* Such may construe their superiors either take a lax attitude regarding the appraisal exercise, or do not exactly know the tasks of their down-liners, or do not properly observe the performance of staff under them.

* Subordinates do not know the perspectives that their direct supervisors actually view at in terms of job performance. An aspect deemed unimportant by a subordinate, e.g. interaction activity, could be considered a key element for appraisal by his supervisor.

* The preliminary list of self-appraisal points may be rejected by superiors, thus resulting in time drag because to-and-fro contentions from both sides. Chances of confrontational debates, grouses and an atmosphere of negative vibes are likely to surface.

* The responsibility of executing a fair assessment relying on specific recorded facts fully lies on superiors as the appraisers. Appraisers are not right to "delegate" part of the responsibility to the appraised parties.

* Subordinates cannot read the mind of superiors what are viewed as strengths and weaknesses of the former. Self-appraisals, albeit preliminary and may be amended by superiors, are subjective interpretations likely leading to controversies.

* For the lowest rung (usually menial) employees like despatch boys, janitors, drivers etc., would they have the propensity to know how to appraise themselves properly? The preliminary self-appraisal would be a fallacy if applied to them.

I now share with you my personal views on the essential constituents of an efficacious appraisal system.

# Superiors must be the party responsible and accountable for gauging direct subordinates' performance regularly. The sole onus is on the superiors to assess their subordinates. Hence, continual appraisal notations applicable to subordinates should rightly be done by superiors.

# Superiors who supervise their direct down-liners should be tasked to do appraisals on the subordinates. The line of responsibility for this task descends from top to bottom, e.g. the head of a department appraises his second line managers; the second line managers appraise the third line subordinates, and so forth. In other words, the sequence of responsibility follows the line of reporting. However, the department head may oversee the entire process under his jurisdiction.

# Parameters for determining performance in relation to each job must be well defined, objective, specific and fair to the appraised individual.

# Grant actual ranking based on actual performance measured against the pre-specified parameters and assigned goals.

# Recognition and reward to commensurate with the actual ranking of each employee.

# Corporations with overall good manpower should have a substantial number above average scores, thus justifying higher overall incentive expenses.

# Set realistic, attainable targets for employees, There can be two sets of goals - level 1 for minimum target, level 2 as achievement of excellence.

# Performance points to be measured against targets identified for each employee should be specified upfront. For example, in the scale of 1 to 10 (ascending order), a sales officer who achieves his level 1 sales target will score 10 points under the sales parameter segment. If he hits his level 2 (excellent) target, he right qualifies for bonus points in addition to 10 points. Along the same principle, another sales officer who could only reach half of his assigned level 1 target will secure 5 points. Recognition should commensurate with the scored point.

# For tasks that may be more subjective in nature to appraise, a system for recording facts should be designed first. For example, a structured customer service action questionnaire could be designed to solicit inputs from customers served by a service officer. The questionnaire must be specifically relevant to the job scopes and targets of the employee.

# Facts substantiating the ranking accorded to an employee should be cited in the appraisal document.

# A structured procedure for direct up-line supervisors to gauge and record observations of subordinates' performance is needed. The recorded observations support the basis for denoting the performance proficiency of each subordinate.

# Ideally, one-on-one dialogues be held between supervisor and subordinate three times a year regarding performance progress of the latter, i.e. whether on track or falling short. The gist of the dialogue should be noted in writing. The final dialogue is part of the format for appraisal documentation on performance level measured against assigned targets. Supervisor's notations in the final appraisal document to include areas which the subordinate concerned needs to improve. In addition, the supervisor should recommend an action plan to assist the subordinate in this respect.

# In order to be proficient in the appraisal programme, all superiors/supervisors must undergo structured familiarisation training. This is to ensure consistency of procedural application in the exercise and fair treatment to subordinates.

# With regard to the final appraisal document, appraised employees deserve the right to indicate whether they "agree" or "disagree" to the comments and conclusions drawn by appraisers. Those who disagree can state their counter comments in the document. Appraisers and the relevant higher officers or human resource department head will then review before concurring either to stay firm or grant an improved ranking. This is done in all counts of fairness to both the appraisers and contending individuals on the other side.

# A comprehensive appraisal format also facilitates managements to identify where else under-performing employees may better fit in and then assign them to the relevant other roles if available. Socially responsible managements allow "redeemable" employees a second chance to prove their worth in alternative suitable roles.

I do readily agree if you opine my proposals cover too much tediousness. Yes, an immaculate appraisal procedure is unavoidably meticulous. The whole process holds a bearing on the future of employees. To me, corporations are obligated for implementing an infallible appraisal system as their respective management is also entrusted to demonstrate fair treatment to employees.

The bane of tediousness comes first before acquiring the boon of sound manpower management, leading to firmer overall productivity and efficiency. There are no two ways about it. And there is no compromise if the real determination is to be a stellar reputed brand name as the company of choice to work for.

A corporation desiring to carve an iconic image of excellence needs to realise this fundamental fact: Manpower is its prime resource that either propels it to further heights of success or plummets it deeply. Without a prolific programme to properly monitor, assess and manage the efficacy of overall manpower performance, the impact of all other resources will be negated. The boon of reaping positive results comes about after the willingness to go through the bane of instituting a meticulous employee management tool.

A parting statement for reflection by top managements: Never, ever try to implement employee appraisals and rewards not in accordance with actual deserving performance merits just because of the intent to control manpower expenses. Doing so will stifle the wholesome growth of your company to eternity.




ENDS....