So what other factors discredited performance review systems ?

There are many excellent reasons why performance review was and still is a good concept. Why then have performance reviews by and large failed to deliver? Particularly as most people welcome performance review as an opportunity to find out how they are doing compared with the organisations expectations.

To start with delivering a performance review can be quite a time consuming process and if the manager is functioning under the stress of delivering results to fuel his/her career aspirations or even to justify retention of their position then there is the very distinct possibility that they will not give performance review preparation or the performance review meeting sufficient time to make the process effective.

Of course organisations understand that performance review is not without its problems so why do they persist? Is it because current management theory still subscribes to performance review, or is it because employees often express the desire for one, or is it because on balance they believe performance review does more good than harm, or is it because of lethargy or lack of creativity in not making the performance review process effective?

Whatever the reason for continued use of performance review systems, performance review is one of the areas of management most commonly complained about by employees and managers alike.

A major mistake made by companies is their failure to recognise what constitutes an effective performance review system. Often companies see performance review as the mechanical, administration of personnel forms "for the record", i.e. for them it is the interactive performance review process and not the outcomes that justify the performance review system. This notation is reinforced by the false premise that the performance review process shows the boss as being human and caring in giving employees the opportunity to get matters off their chest. Such organisations of cause fail to realise that it is action that employee want not sympathy.

Another mistake is that many companies do not invest in performance review training or keep their performance review system up to date, by that I mean dealing with identified inadequacies thereby ensuring that the system continues to meet changing organisational needs and changing operating environment and marketing conditions.

In the worst cases organisations do not even have a structured performance review system at all, instead leaving it to individual managers as to how they should conduct an employee performance review, if one is done at all. As a result, without an effective performance review system and proper performance review training those managers who lack interpersonal skills and who are uncomfortable with dealing with conflict (and surprisingly there are many) often fail to accurately address an employee's shortcomings and developmental needs.

Very few know how to inform an employee that their performance is less than required and less than they are capable of giving, or that they have an attitude or behaviour problem that is limiting their contribution or adversely affecting their colleagues. The consequence is that even if the performance review system design was effective so often the performance review outcomes are disappointing simply because the performance review process is mis-managed.

Not only do managers failure to give honest performance review feedback, which is clearly unfair to the employee, but they deny themselves the chance to obtain information necessary to improve organisational performance, and their own. The consequence is that if the performance review system is discredited then it is usually because the manager conducting the performance review is not skilled, or trusted, or respected.

Of course all this may not be universal for there are also good managers who will work actively with their people to ensure that benefit will flow from the process. But even they have difficulty should the performance review system itself be flawed.

The two most common performance review system design flaws are:

organisations limit performance review to making employees accountable for past endeavours. Why would they want to do this? - because autocratic cultures take the view that making people accountable for "poor performance" will automatically generate improvement (maybe, but limited and short lasting and then only in a fear culture). Also if performance review focussed upon creating a better future they would argue that improvement could only be achieved by resource deployment and they simply do not want their line managers entering into organisational resource commitments outside of the traditional decision making procedures which senior management control.

tying performance review to employee salary review. Why would they want this? because they wish to reinforce the sanctity of management and no better way to show who is boss than using stick and carrot!!