How Useful is an Employee Review? Part 1

For years, businesses have used semi-annual reviews to evaluate employees. A supervisor or several supervisors sit in a room and discuss what the employee did or didn't do. Often they even ask the employee to fill out a self-evaluation, which is a curious thing to ask an employee to do in its own right, and they sit awkwardly and discuss what the employee has done over the past year. It's an unusual way to evaluate talent, and one that has come under a great deal of scrutiny – it's also one that you may want to question using in the future.

Recency Bias Performance reviews are generally conducted over a one week period, where one supervisor (or a few supervisors) give their subjective opinions of the employee that they spend maybe one hour deciding on. That experience is going to nearly always be based on the most recent projects the employee has worked on, and the remaining six months to a year are largely ignored. It's not a semi-annual review if only a few weeks are taken into account.

No Recency Bias Interestingly, the opposite problem may also be true. If something particularly stands out about the employee from months back, their current production may be ignored. So an employee that struggled several months prior for a short while, but has excelled since, may be graded based on the previous struggles and not on their current success, or vice versa.

Central Tendency Employees are rarely given full grades for outstanding work. Many managers take the "it could always be better" approach and never give full scores even to those workers that are doing well in their role.

But that score misrepresents the skill of the employee, making it harder for others to look to the evaluation as a true sign of talent and not providing the employee with feedback that indicates they're doing well. Subjective Performance Evaluation Arguably one of the greatest problems with this type of evaluation is that measuring performance based on the opinions of one or two supervisors based on how they see the employee.

But numerous studies have shown this is not an effective way to measure productivity. These performance evaluations may be giving low scores to great employees and vice versa, in ways that badly affect employee morale and your ability to spot the productive staff members. This is a serious problem, one that we'll explore further in the next article.