I was conducting a workshop last week and asked a room of 22 people on what was on top f their mind when they entered their manager's room for the annual performance appraisal discussion - 20 of them said "pay raise and bonus", the other two were freshers and had never been to one.

There are a large number of studies that show that money, and other forms of external motivation work, but only for performing mechanical tasks. For any problem solving, decision making, conceptualizing …anything requiring the right brain, external motivation not only does not work, but it has been shown to adversely affect performance. The "if-then" rewards also narrow focus and impair creativity. i.e. extrinsic motivation like dangling money,

  1. works for a very narrow set of circumstances,
  2. and can do more harm than good
  3. It cannot survive the long term

Motivation that comes from within, on the other hand, has been shown to be longer lasting, because of elements like fun, enjoyment, curiosity, and purpose of the activity.

Now, we have known this for almost half a century, yet businesses choose to ignore science and embrace practices based on principles that are outdated, unfounded, and anecdotal. In short, an area that's ripe for disruption.

The good news is that over the last few years, there have been significant shifts in the way businesses make decisions on talent, performance and compensation. Companies like Adobe, Accenture, Deloitte, GE, Microsoft and Dell, to name a few, have all done away with the forced ranking and traditional performance appraisal because they were:

  1. Time consuming
  2. Do not improve employee performance
  3. Are not good for employee morale
  4. Promotes hierarchy and reduces collaboration

While there is no one magic formula that works for all, a few practices that seem to have worked:

  1. Increased frequency of feedback/ performance discussions - some are following a real-time feedback process
  2. 360deg feedback - from supervisor, co-workers, team members, customers and other partners
  3. Are not good for employee morale
  4. Supervisor focus is on improving employee and company performance not the bonus/ pay raise
  5. Simplify the process - no long forms to be filled out
  6. Keep the talk on performance separate from salary
  7. Transparent calculation of pay raises

Irrespective of where your employers are in embracing this shift, having a meaningful feedback discussion is essential to be able to drive improvement in your performance. I have been through numerous conversations that were one-sided and focused on how to eliminate weaknesses. “Go forth and network” delivered like clockwork annually (bi-annually for those that felt people were their greatest assets), just made me dread the discussion and lose respect for it eventually. Even if sometimes there is the token first and last 90 seconds spent on what I did well - sometimes referred to as the “sandwich approach”

One of the reasons why appraisals are not popular is that they are focused on the past and on what did not go well. In a world that is changing so fast with roles catching up, dwelling too much on the past is unlikely to help the employee succeed in the future.

A bigger issue is the emphasis on negative feedback albeit “well-intentioned”. Given that the basic underlying premise is that all employees are created equal and everyone can be good at everything, the remedial measures are woefully inadequate. To add injury to insult (yes, that’s deliberate), it also takes a toll on the morale of the employee.

So, how does one ensure that these discussions become more fruitful. Here are some pointers that you could use to nudge yourself and your supervisor to keep the discussion achievement focused and developmental.

  1. “What is in your view my single biggest achievement in the last period?” Helps get a specific answer and understand why it was important.
  2. “What behaviours did I exhibit that you think will help me contribute to this team/ organization?”
  3. “How can I get myself into more situations in the coming period, that bring out these behaviours?”
  4. “What does excellence in this role look like? Results and behaviours”.
  5. “What skills do I need to add/ build to excel in this role?” Note these are trainable skills, hence close this out with formulation of a training plan
  6. What are the company objectives for the next period? Discuss how you think you can contribute. I have always loved discussions where employees bring suggestions on where they think they can add value to the organization… be it specific projects, or other roles.
  7. What roles, projects in the organization are truly aspirational for you? Obviously, an overlap with 6. above would make it even more desirable.
  8. Talk about how you see the future – yours and the company’s.
  9. Tell your supervisor what makes you happy and what you need to do your best work.

These are obviously not an exhaustive list, but you can see where I am going with this. Remain focused on the successes and how you achieved them and how can you do more of the same in the future. This does not mean that you ignore poor performance or weaknesses. If it is a question of acquiring a skill, by all means, plan for it. But if it is a deeper trait, recognize that the solution may not be in attempting to change behaviour. Being aware of the weaknesses, accounting for them and using strengths to address them is the way to go. More about strengths and investing in them in other articles. Good luck with your performance reviews.