The Top 20 Challenges with Performance Appraisals

The following list details 20 of the greatest challenges with performance reviews and categorizes them into 5 distinct buckets. 

Performance

These challenges shed light on common problems with performance expectations. 

1. Lack of defined objectives- An array of issues present themselves regarding performance objectives and a lack of clear definitions. Oftentimes, they are too general or have vague definitions. Employees show up to the review discussion to find they have not met performance requirements that they were unaware of in the first place. 
2. No clear goals- Similar to objectives, ambiguous goals cause confusion as to what the employee is expected to accomplish. Without specific goals the manager is also ill-equipped to provide appropriate coaching and guidance. 
3. Not measuring core values/workplace behaviors- Workplace performance and workplace behaviors are mutually exclusive. It is certainly probable to have an employee who meets or exceeds performance goals while also not displaying behaviors that align with the company’s core values. The reverse is true as well. Not measuring core values and performance equally may result in rewarding the wrong behaviors and elevating employees who do not behave in a way that is reflective of the organizational values. 

Communication

Inconsistent or non-inclusive communication throughout the performance cycle often results in unproductive performance review discussions. This list of challenges labels common communication failures. 

4. No continuous feedback- Employees undoubtedly prefer ongoing, frequent communication about performance with their managers as opposed to a formal discussion once or twice a year. In fact, when continuous feedback is embraced through monthly one-on-one check-ins, for example, employees view the review as a detailed summary of all recent conversations. An absence of continuous feedback practices leaves employees ill-informed and is detrimental to their relationship with their leader. 
5. No self-assessment- The employee’s voice matters. Performance review discussions that function like a monologue and do not invite the employee to participate are at risk of myopic viewpoints. This approach may cause employees to believe they are not valued and that the review is something that happens to them, not for them. 
6. Misalignment of expectations- Alignment meetings are when the manager discusses performance expectations at the beginning of the review cycle so there is no room for confusion for the employee or the manager. Failing to hold these discussions leaves ample room for misalignment and missing the intended targets.

The Assessment

A cumbersome performance review wastes time and likely does not produce the intended results. The most common pitfalls of performance assessments are listed below. 

7. Ill-defined rating scale- Incorporating a rating scale that does not define terms, such as what a 1-star vs. a 5-star represents, results in employees not being evaluated fairly. If Manager A decides 5 stars is equivalent to meeting expectations but Manager B believes it means exceeding expectations, their respective employees will receive incongruent assessments, leading to confusion and misleading performance data. 
8. Limited viewpoints- Review software solutions that do not include peer, upward, or external feedback in the final assessment neglect to invite additional perspectives. Incorporating 360-degree feedback ensures a comprehensive evaluation. 
9. No historical data- Manual review processes hold a high margin for human error in that papers can easily be lost or discarded. Using a reliable review platform helps to mitigate this issue while also providing a way to document and track historical review information.
10. Disconnected from rewards- Organizations that separate performance reviews from extrinsic rewards often experience employees who struggle to stay motivated and connected to the mission, vision, and goals. Rewards for performance can go beyond purely financial, such as public recognition or promotional/title changes. 
11. Not documented properly- A lack of proper documentation can cause several issues for the employee and the organization at large. Without reliable notes, managers tend to rely on feelings or recency bias to make performance assessments, and HR leaders miss the ability to track historical trends.
12. Not viewed comprehensively-  Though performance should be assessed individually, there is value in calibrating results to ensure managers are evaluating fairly. Additionally, measuring team results helps to fill any potential gaps in the story and can provide HR leaders with helpful information for making business decisions. 
13. Gap in satisfaction- High-performing organizations survey employee satisfaction alongside performance tracking. When reviews are absent of the employee’s general satisfaction rating, a key piece of information is missing. Checking the pulse on employees’ overall sentiment about their role and company leads to healthy discussions about performance, such as what practices encourage or inhibit strong performance. 

The Manager

Managers are most often promoted based on tenure and expertise and not according to people management skills. Despite a desire to lead their direct reports well, many managers never receive a crash course in how to execute beneficial performance reviews. The following list details problems resulting from management. 

14. Lack of management training- Only a sliver of a manager’s job description includes the performance review. Managers who do not receive even basic training in how to lead review discussions can feel unprepared and stressed, resulting in a less-than-ideal performance discussion for them and their employees. 
15. Inconsistent evaluation standards- Without objective standards by which to assess employee performance, managers default to evaluating based on their personal beliefs and experiences. Some leaders are highly critical of performance behaviors while others avoid conflict at all costs and therefore rate all performance as generally good. This creates an environment of unfairness and subconscious bias. 
16. Recency bias- It is instinctual to draw upon our most recent memories when evaluating a given situation. Similarly, managers who neglect to document ongoing feedback often rely solely on their most recent interactions with an employee when assessing their performance. However, it is widely recognized that this approach is fundamentally unjust, as it fails to take a comprehensive and holistic view of an employee’s overall performance.. 
17. No accountability for completion- HR leaders in all industries breathe out a collective sigh when it comes to performance review completion. Organizations with low accountability often struggle with managers submitting completed reviews on time. The consequences are skewed results and employees getting frustrated that they put in the effort to complete their portion of the review, only for it to be lost or forgotten. 

The Process

How performance reviews are issued and completed is so important as it helps to define the overall employee experience. The list below speaks to the challenges with review processes and formats. 

18. Manual/inefficient systems- Obsolete and cumbersome solutions consume valuable time that could be directed towards more crucial aspects of the business. A platform or process that is challenging to navigate leads to frustration among employees and managers, ultimately dampening their motivation to fully invest themselves in the review process.
19. No single source of truth- Manual papers or disparate performance systems force HR leaders and managers to spend precious time searching for pertinent information. The absence of a single source of truth increases the likelihood of employee data going missing and causing unnecessary strain on the performance management process.
20. Data goes nowhere- An often unintended consequence of a poor performance review process is that the information gathered does not lead to marked changes. A common frustration among employees is going through the process with their manager only to find that none of the topics discussed resulted in adjustments to the daily workflow. Performance discussions should produce action for the employee and manager.