The thing is, you might not even realize you’re making mistakes. Here are five methods you might be using but need to avoid when doing these reviews:
The Sandwich Approach
A very common mistake, this method involves starting off feedback with praise, dishing out the negative news, then sugarcoating it with more praise. Something similar to, “We value your work, but you’re not meeting the production level. However, you’re a valuable employee to us.”
“What has this person done lately?” This is a question that managers ask themselves, and the answer is the result of a recency effect—a psychological theory that involves using recent events to analyze past performance.
When review cycles have a 12-month lag, it’s easy for managers to focus on what’s fresh in their minds. But this brushes aside any positive or negative behavior that has gone unaddressed.
Avoid this by doing weekly one-on-one meetings with your employee. That way, you can provide feedback while it’s still actually, well, relevant.
The Horns And Halo Effect
A Princeton study had participants rate a man in suit with a Cornell degree versus a man in casual clothing with a nondescript college degree. The participants rated the suited man as more competant than his casual counterpart. And that's the Horns and Halo Effect—managers assume that an employee is naturally good or bad at their job.
This can be prevented by basing performance reviews on data instead of opinion. How many sales has this person closed in one month? How many clients have they lost in two months? Doing this deters any opinion from obstructing the actual review.
"Like Me" Bias
The U.S. Equal Employment Opportunity Commission released a study and found that people prefer to associate with others that are like themselves. This mentality can stem from something as serious as racial prejudices to disliking how an employee styles their hair. But in the end, it has the same result: managers believe that people who aren't similar to them can't perform their jobs well.
Just like the Horns and Halo Effect, you can avoid this by having data-driven reviews. Opinions have their time and place, but they definitely shouldn't define an employee's review.
Central Tendency Error
The last method to avoid is one that involves team evaluation. If a manager rates a group of people as average performers, then they're more likely to evaluate individual employees as average as well. The flaw in this method is that underperformers are getting overvalued, and overachievers are getting undervalued.
You need to customize each individual review. Yes, it might take a long time. But individual reviews are critical if you're looking to truly evaluate an employee's performance.
It's easy to accidentally use one of these methods. You might not even know you're doing it. But when doing reviews, keep in mind that employees can handle negative feedback as long as it's honest and data-driven.