7 annual performance appraisal mistakes

Regardless of what type of performance management model your organization is currently using, a year-end, development-focused conversation is absolutely necessary. As a leader, it’s your greatest opportunity to discuss progression towards long-term development goals, celebrate successes, distill the learning from perceived failure, and take a holistic view of performance throughout the year.

Here are seven common mistakes that leaders make in performance-based conversations. Avoiding these will help you turn what can be a disengaging, anxiety-ridden conversation into a transformational experience that actually drives performance results and increases employee fulfillment.

All head and no heart
One of the most common mistakes leaders make in performance management conversations is to not connect the heart as well as the head. You might be asking yourself, “Do I really have to talk about feelings at work? Is that even appropriate?” and the answer is, YES. We know, based on the work of Nobel Prize winner Daniel Kahneman, that humans (regardless of age, sex, gender, race, nationality etc.) make decisions emotionally first, and then logically. Therefore, if your goal is to impact performance results or create behavioral change, you need to be comfortable talking about feelings. The effective leader uses genuine curiosity, empathy and compassion to create a safe space in which the real conversation can be held.

A great way to connect the head and the heart in this conversation is by asking any of the following questions:

“When you consider your results, what do you feel?”
“What does it feel like to have accomplished that?”
“What is your heart telling you?”
“What is your greatest fear around that?”
“What brought you joy this year”
“What does it feel like when you are at your best?”
“What does it feel like to (insert experience here)”

Focusing only on success
Although it’s important to acknowledge and celebrate success, it’s equally important to talk about failure. We tend to gloss over failure in the year-end review in a misdirected attempt to avoid disengagement and end the year on a positive note. And let’s face it, it can be uncomfortable to even broach the topic. Finding the courage to persevere through this sensitive conversation can yield developmental gold, as we usually learn more from our failures than our successes. There is a rich conversation to be had around what was learned by not hitting a performance goal. The key is to name the perceived failure but not focus on it. The heavy-lifting for you in this conversation is distilling the learning and helping the employee identify how this new insight will shape their behavior moving forward.

Great questions to explore this area around perceived failure include:

“What did you learn by not achieving that goal?”
“When you look back at your year, what was your greatest disappointment?”
“If you had to do everything over again, what would you do differently?”
“What got in your way?” “What habit would have supported you in achieving that goal?”

All backwards looking
Although the annual performance appraisal seems to be an inherently backwards-looking exercise, it’s important to note that the only reason you should ever look back is to better understand how to move forward.

Some great questions to help ensure the conversation is future-focused include:

“Knowing what you know now, what advice would you have given yourself when you started this?”|
“How would you approach that situation again in the future?”
“What would double the learning for you in this situation?”
“Given your results last year, what new habit would support you in reaching that goal next year?”|
“Which one of your strengths can you lean on in tackling that?"
“Who could support you in that?”
“What do you need to learn in order to be better prepared next time?”

Tunnel vision
Think of how much time you actually spend observing your team in their daily work. You are coming to this conversation with an entire host of assumptions and opinions, which if not checked, will lead you straight into confirmation bias. Most likely, these opinions are based on limited direct experience, second-hand feedback, and end results. Unfortunately, it’s the behaviors you don’t see that are often the ones that most need to be talked about. For this reason, a great annual review includes multiple perspectives. A leader can do this by soliciting feedback from others. Ask your employee for the names of 3-5 people they interact with at work whose feedback would be helpful to them, and the areas they’d like to have feedback on. Keep it short – it should take the responder no more than 10 minutes to provide their insights. Keep the feedback anonymous by presenting a high level summary with general themes. This can be a game-changer for your employee’s development – and you will most likely learn something valuable yourself.

You should ask for feedback for your team member in the following areas:

What are two of this person’s greatest strengths? What are two areas of opportunity for this person? What advice would you give this person to be more effective in their role? Customized question regarding the topic your team member wanted feedback on.

Making it all about them
It might seem that this conversation is all about your employee but at the end of the day, you are their leader and your relationship (good or bad) has been a huge influence on their performance. Therefore, some time should be spent talking about your working relationship. This is a fantastic opportunity to get valuable feedback on your leadership and how it has contributed to or hindered their success. Remember that the way in which you receive the feedback will determine whether you ever get it again. In this conversation, you will be modeling how to receive feedback and whether or not it is truly safe to give constructive feedback. I recommend sending a few of the questions below before the meeting in order to give your team member enough time to form their thoughts.

Great questions to solicit year-end feedback include:

“What feedback do you have that would make me a more effective leader for you?”
“What is working about my leadership?”
“Where do you think I still have room to grow?”
“If I could implement one thing, what do you think would have the biggest impact on our team’s results?”
“What feedback do you have that would help make our one-on-ones more effective?”\
“Where do I get in the way?”
“What support would you like next year that you’re currently not getting?”

Focus on numbers and not impact
In general, leaders tend to be obsessed with end results (aka. numbers) – especially in a sales or KPI-driven business. It’s easy to fall into the trap of thinking about success as being binary; if you meet your budget you are successful, if not, you failed. Focusing only on end-results sends a strong message that the only thing that is valued in the organization is the ability to “make the numbers”. We’ve all witnessed top producers who contribute a tremendous amount of revenue to an organization but who leave an incredibly negative emotional wake, with a trail of bullied and de-motivated co-workers behind them. You can place your company values on the wall and proclaim them at company meetings but people watch what gets rewarded and promoted for those are the values that are truly being honored. Expanding the conversation away from end-results and towards impact, allows you to

take a holistic view of the employee’s entire performance. In short, the focus should not only be on what they did, but how they did it.

Some great questions to support this include:

“How would you describe the “brand” you’ve created for yourself this year?”
“What difference do you want to make here?”
"How would you describe your influence on your colleagues and peers?”
"How do you think you’ve contributed to the success of our team?”
"How would you describe the feeling that people have after an interaction with you?”
“What values did you honor this year?”
“How did you embody our company’s values and vision last year?”

The classic blindside
Many of us have been there…that moment you find yourself being totally blindsided in a performance review. Your leader has finally worked up the courage to give you the difficult feedback and they’ve unleashed a dump truck of issues on you. They have been withholding this feedback for so long, that they now have examples from the beginning of the year to prove their point. This is by far the most detrimental of all of the errors as you disempower the relationship, bankrupt any emotional capital you’ve built, and appear to be a crazy person! The entire time your team member is thinking, “Why didn’t you come to me with this sooner?” You lose all credibility and trust as a leader. This constructive feedback should have come during your one-on-ones, when the focus of the conversation was performance coaching. Therefore, the most important rule of any annual performance appraisal is: There should be absolutely no surprises. This is a time for insights – not blindsides.