Why performance reviews are so reviled

Lots of companies have an annual performance review that goes along with the calendar year, which means right now it's probably on your mind. If you're a manager, you're dreading writing them. And unless you own the company, you're probably dreading receiving yours -- no matter if you're a top notch employee. Even if your performance was fantastic, you know the review won't necessarily reflect that.

Just how much does everybody hate the whole performance review process? A new survey by GuideSpark, an employee communications company, has some eye-opening answers:

  • 89 percent of employees would like it if their performance review feedback wasn't a surprise.
  • 89 percent wish managers would be direct in giving feedback.
  • 75 percent say reviews don't always lead to better performance.
  • 60 percent don't understand how their performance is evaluated relative to their peers.
  • 54 percent say reviews are inaccurate.
  • 45 percent think performance reviews are a total waste of time.
  • 33 percent are confused about how reviews relate to their compensation.

All in all, the results are pretty miserable. Here's what companies are doing wrong.

Managers give feedback only when forced. When 89 percent of employees say they wish their reviews weren't surprising and the same amount want managers to be direct, it tells me that overall, feedback is a huge problem. It could be that managers don't want to give feedback throughout the year, employees aren't listening when they get it, or managers feel they can't say anything unless it's "official."

It doesn't have to be that way. Managers should be giving feedback on a regular basis and making notes on what they've said so that the message is consistent. Employees should know exactly where they stand at any given point.

The relationship between employees is mysterious. Part of this should remain so. After all, the last thing you want is a boss who spends her time going from employee to employee saying, "You're better at this than Jane but worse than Kevin!" That doesn't make for a good environment. Add to that, many companies have forced ratings distributions. That is, a manager is limited in how many employees she can rate as "exceeds expectations" and is forced to rate a certain amount as failing.

There are financial reasons for this, but the end result can be that an employee who sees herself as performing at a level equal to her peers can find herself rated below them. It's frustrating, but your direct manager isn't always at fault.

Managers don't set clear goals. With 54 percent of people saying reviews were inaccurate, that indicates a large number of workers think they're accomplishing X, but the manager thinks their focus should be on Y. What's going on is a lack of communication. Managers should take the time to write up clear goals, and the review should be based on those. Of course, requirements can change midstream, but the manager should write up those changes and make sure the employee understands.

Are reviews a waste of time? As someone who hates giving and receiving performance reviews, I'm tempted to say yes, but the numbers say otherwise. If 89 percent of employees receive "surprises" in their reviews, they would never learn that information without the review, so this may be the only feedback they get all year. That's critical for business success.

Regular documentation of performance levels is also critical if you ever need to discipline, fire or lay off someone. You'll need to be able to show that Karen really was a better employee than John, and that's why John was chosen to be laid off.

For your review: Take the time, right now, to write up how you feel you met your goals. If your company has a formal self-review process, do that -- even if it's voluntary. Regardless, give your write-up to your boss. It will help your boss see what you've done and will emphasize the areas in which you succeeded, even if your boss wasn't directly aware.

For your employees' reviews: Ask them for self evaluations. Look at your old notes and email so that your focus isn't just on the last couple months, but on the entire year. If your own boss is forcing you to give a rating that doesn't seem appropriate, push back as much as possible. It's important to the success of your department that ratings be as accurate as possible.