Appraisals – Why They Are Important & How To Conduct Them Effectively

Introduction

Within this article, we will be speaking about appraisals and why they are important & how to conduct them effectively. Appraisals are an important and widely used tool designed to help organisations achieve their short, medium, and long-term goals. When used effectively, they provide managers with a framework to manage the performance of all their team members.

What is an appraisal?

An appraisal is a meeting between a manager and employee, solely focused on discussing the employee’s past performance (over a defined period of time, usually one year) and focusing on priorities and targets going forward.

Appraisals are different from disciplinary actions, for more information visit Gov.uk.

Why are appraisals important?

The most obvious purpose of employee appraisals is to measure employees’ performance. This is important for a number of reasons:

  1. To ensure employees are working to the required standard
  2. To formally measure which employees are performing to the highest standard, and to reward them accordingly
  3. To address any performance issues

The appraisal process is important in ensuring employees feel valued, and that their good performance and successes at work are formally recognised. It is also important as it gives the employee the opportunity to discuss their future career ambitions with you and to agree on appropriate mechanisms for the Company to support their ambitions.

A formal appraisal is a perfect opportunity to give employees good quality feedback and to refocus their efforts for the coming year.

For more help with hosting appraisals please contact Opt HR for HR Support or Retained HR Services.

How often are appraisals conducted?

Appraisals are usually conducted annually, with either quarterly or mid-year interim reviews, and more regular (monthly or weekly one-to-ones) informal meetings between the manager and employee.

What is the purpose of an appraisal?

Appraisals provide a structured and consistent framework to manage the performance of all employees, they:

  1. Allow for the formal acknowledgement and recognition of employee achievements
  2. Provide a formal forum for discussions around development needs and career progression
  3. Facilitate a link between salary increases and good performance
  4. Allow for the identification of any performance issues and lead to planning to resolve these
  5. Identify areas of improvement
  6. Set objectives and priorities going forward
  7. Identify training needs related to career progression, areas of improvement of new priorities

For more information about Performance Management, click here.

What does an appraisal involve?

The exact format of the appraisal will vary by company depending on their specific needs, however, all good appraisals include:

  1. A structure for both the manager and employee to prepare for the appraisal meeting
  2. A structure for the appraisal meeting – achievements, overall performance, targets and priorities, and development needs
  3. A formal record of the appraisal process that both the manager and employee have a record of
  4. Regular review of performance, progress against targets, and achievements

Setting goals

The most productive employees are those that are driven to achieving achievable and relevant goals. Setting such goals during the appraisal process ensures employees are focused and motivated on the key priorities. Setting new goals also ensures that employees are always working to meet the changing needs of the Company.

Resolving issues

Appraisals are a unique opportunity to resolve any issues before they become more serious. Often, we can get engrossed in the day-to-day and miss small issues employees may have. Appraisals are a perfect opportunity to resolve any issues employees may have, or to express any concerns you may have, and to agree on a plan to resolve them.

When managers listen to employees and address their concerns, it can lead to a happier and more motivated team.

Refocus team members

Appraisals are a good opportunity for managers to share their vision of the department or the wider business for the coming year. This ensures that all employees are working towards the same overall goal and understand the direction of the business.

It is also a good opportunity to refocus on the key priorities of the team and ensure everyone has a shared understanding of these.

Training and development needs

Employees have different strengths. Appraisals are a great time to recognise individual strengths and plan how to capitalise on them, and also to agree on any development needs and how these can be addressed. Investing in employees’ development can lead to higher performance and a more motivated team.

Where an employee is not meeting the standards required of their role, open discussions early on can provide the opportunity to explore positive solutions, giving employees support to improve their performance.

Using appraisals to spot potential in employees

Appraisals are the perfect time to map out career paths with your high performing employees, and agreeing a plan to support them in achieving their goals (in line with business needs). Without an effective appraisal system, organisations may never spot talented employees who maybe their leaders of the future.

Learning and Development can be a huge boost to current employee’s skills and potential.

Using appraisals to manage changing roles

Almost all jobs evolve over time. Appraisals are an ideal time to manage any changes to roles by:

  1. Explaining new or changing responsibilities clearly
  2. Setting clear goals in relation to new or changed responsibilities
  3. Arranging training to support the employee in being successful

Using appraisals to improve performance

The targets set in appraisals can challenge employees to improve their performance and improve the team’s performance.

Rewarding employees fairly

Using a clear and consistent appraisal process and linking this to how employees are rewarded ensures employees feel fairly valued for the work they do and their contribution to the organisation. By monitoring performance, overall job performance, and achievement of targets managers can assess whether to reward employees with salary increases, bonuses, or even promotion opportunities.

Appraisals are also an opportunity to reward staff informally by saying thank you.

Building a culture of trust and openness

A culture of trust and openness is important to the success of any organisation. An effective appraisal system is a central element of this, as it fuels discussions and can empower staff to have control over their own success.

Preparing for an appraisal

Manager’s appraising employees should ensure that they prepare thoroughly for the appraisal meeting.

Manager preparation

In order to ensure that the appraisal process is purposeful and useful, managers should prepare thoroughly for appraisal meetings. Consider the following:

  1. The employee’s overall performance in their role
  2. The employee’s achievement of previous targets
  3. What have been the employee’s biggest achievements in the last year?
  4. What challenges has the employee faced? How successfully did they overcome them?
  5. Have training needs identified at previous appraisal meetings been met? Has the development need been addressed or is further development required?
  6. What other training or development needs have arisen?
  7. What are the key priorities for the next year and how do these translate into targets for the employee?

When preparing it is important to:

  1. Make notes in advance of the meeting
  2. Ensure you take responsibility for any changes in targets or requirements of the role or the changing circumstances of the organisation
  3. Celebrate the employee’s successes
  4. Review the past and look forward
  5. Make any negative comments constructive, and think about a potential solution to solve any issues you have identified
  6. Focus on the purpose of the meeting
  7. Compare the employee to the standards required of their role, not to their colleagues
  8. Be objective

Employee preparation

In order to get the most out of the appraisal process, employees should prepare thoroughly for their appraisal meeting. This meeting is a formal opportunity to review your successes, where improvements can be made, and is an opportunity for you to discuss any concerns or achievements that may otherwise be overlooked.

When asking employees to prepare for an appraisal, they should consider the following:

  1. What have been your biggest achievements in the past year?
  2. What have been the biggest challenges you have faced in the last year? How did you overcome them?
  3. How would you rate your overall performance over the last year?
  4. Have you achieved your targets over the last year? If no, what has been the context around this?
  5. What do you think your objectives for the next 12 months should be?
  6. What are your career objectives in the next 1 to 3 years (if any)?
  7. What development needs do you think you have?

When preparing it is important to:

  1. Make notes in advance of the meeting
  2. Ensure you take accountability for your performance
  3. Celebrate your successes
  4. Think about the future
  5. Make any negative comments constructive, and think about a potential solution to solve any issues you have identified
  6. Focus on the purpose of the meeting
  7. Compare yourself to the standards required of your role, do not compare yourself to colleagues
  8. Be objective

The appraisal meeting

The appraisal meeting is a formal, documented conversation. It is important that both the manager and employee:

  1. Have had sufficient time to prepare for the meeting
  2. Are objective
  3. Present any negative comments constructively, with a plan for how to resolve any issues
  4. Agree on any follow-up actions that need to be taken
  5. Summarise the meeting

For more help with Appraisals, HR Policies, and Procedures, see more here

Summary

We strongly recommend that managers:

  1. Conduct appraisals with their employees
  2. Have regular one-to-ones and interim reviews with their employees
  3. Apply any appraisal process fairly and consistently
  4. Remember appraisals are a two-way process and provide a good opportunity to get feedback from employees
  5. Prepare well for appraisal meetings
  6. Ensure employees have sufficient time to prepare for their appraisal
  7. Ensure appraisal meetings are held in a confidential environment
  8. Remember that there should be no surprises in appraisal meetings

Contact Us

For further information, advice, or support in changing contracts of employment, please contact us at rachel.wade@opthr.co.uk.

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