Communicating with Numbers:  
Measuring Employee Performance
by Linda Gravett, Ph.D., SPHR

I think it’s safe to say that performance evaluation meetings are often dreaded by both managers and their direct reports.  Part of the reason is that it’s difficult for managers to be objective during the performance evaluation process, and direct reports perceive the process to be uneven and inconsistent.  Yet, in order to recruit and retain today’s workforce, our organizations must effectively evaluate employee performance.

To make the process even more difficult, there are definite challenges that we’re faced with in the new millennium in order to ensure our organizations remain productive and viable.  Customers seem to always want “better, faster, cheaper”.  This means that our workforce must have the ability to consistently deliver a quality product or service.  Technology is advancing at warp speed.  Our challenge is to foster a workforce environment of continuous learning to keep up with this technology.  Workforce demographics are shifting.  A growing Hispanic workforce, for example, results in HR professionals being required to be bi-lingual or hire effective interpreters to make sure our message is clearly understood.  Lastly, we need to link performance measures with business needs.  An accountant coming out of college today and into your organization has an important question:  “what does my role have to do with the company’s mission and vision?”

In this article, I’d like to focus on ways to effectively measure employee performance by assessing not just efficiency or traits but the skills, knowledge and competencies that support your organization’s viability in a systemic, meaningful way.

The first step is convincing line managers of the importance of performance reviews in relationship to the organization’s success.  We don’t simply conduct performance evaluations as a “feel good” activity for employees.  (That’s a good thing, because if that were the case, we’d be failing miserably!)  Research shows that there’s a direct and positive correlation between effective performance feedback and productivity.  If we provide clear, concrete feedback to employees about how their role supports the mission, vision and objectives of the organization, we’re more likely to have employees who act in a way that adds value; that is, by enhancing customer satisfaction.

The purpose of the appraisal process is multi-dimensional.  Certainly, this process can be used to determine salary increases and promotions.  In addition, this process can appraise performance relative to one’s job duties.  One of the biggest complaints I hear from employees is that their job description and performance evaluation are two completely different entities.  The duties they were hired to do bear no resemblance to the duties for which they’re evaluated.  If you’d like to see a sample of a parallel job description and performance appraisal instrument, email me at Linda@gravett.com.  The appraisal process is also a means to open the lines of communication about the organizational needs, the individual’s areas of growth required to support those needs, and metrics that describe success.

To successfully conduct performance evaluation meetings that meet the needs described above, there are some specific competencies that line managers and HR need to acquire.  Communication skills, the balance between active listening and talking, are the most critical.  Next, goal setting using “SMART” goals is a must  (Specific – Measurable – Achievable – Realistic – Time Sensitive).  A third competency is the ability to provide constructive feedback; i.e., feedback that is objective, clear, and specific.  The last competency that is critical is the ability to select appropriate metrics and apply them consistently across employees.

In terms of measures, I want to caution against setting simply efficiency measures without also setting effectiveness measures.  When I was new to the field of HR, my job required me to do quite a bit of recruiting.  My boss really pushed getting applicants in the door, conducting the interviews and testing, and then making quick decisions.  I learned to do this in a way that was definitely efficient; however, over the long term, my decisions, and the decisions of others doing the recruiting, were not always the right decisions.  Some of the new hires weren’t the best fit for the department or the organization.  Over time I learned that a better test for recruitment became the quality of new hires and their retention.

During the reporting period, I believe we need to ensure that employees not only have the willingness to do the job but we need to ensure that they have the ability and means to do the work as well.  I can decide I’d like to move one of my office walls out five feet and be very motivated (willingness) to do so.  If I try to walk up and shove the wall five feet, I’ll fail because I don’t have the ability (architectural knowledge) or the means (equipment to actually move the wall).  I encourage you to think about whether you’ve provided employees with a workplace environment that’s conducive to employees doing their best work as well as the resources they need to do their work.  Otherwise, performance evaluations will be meaningless.

Let’s get down to a real issue with performance evaluations – the numbers dilemma.  There is a widespread perception that numbers are subjective.  For instance, people ask me often, “just who is Likert, and why is that scale used so often?”  Some supervisors are “tough graders” who don’t believe anyone is deserving of an outstanding rating.  Lastly, there’s simply not enough clarity around examples of competencies or skills.  What does “communications skills” look like exactly?!

For the above reasons, I’ve found that competency-based job descriptions and parallel evaluations are especially useful because they describe behaviors that successfully encompass, for instance, communications skills.  If an employee always demonstrates the behaviors established for success with this competency, he or she can be rated “outstanding” or 5 on a scale of 1 to 5, for example.  If an employee almost always demonstrates the described behaviors, their rating can be “very good” or 4 on a scale of 1 to 5.  Obviously, there needs to be a “meeting of the minds” across managers around descriptions of the competencies that lead to success in your organization, and you can help guide them through this important discussion.  Start with the strategic objectives of your company.  In order to achieve them, what competencies will be required across your organization?  These are the competencies that should make up your performance evaluation instrument!

If you have questions or comments on this article, I’d love to hear from you!  You can contact me at Linda@gravett.com.