Measuring Employee Performance

By Cheryl Stein
Monster Business Coach

In the last few years, the Report Cards at my kids’ school have changed. Years ago, Report Cards actually meant something. If your kid got an 85% in math, you could reasonably assume that they knew 85% of the math that they were learning. Nowadays, we don’t want to just judge the kids on how many right answers they have given. We want a formula for their participation, their ability to problem solve, their relationships with the concepts. In wanting to know more about their global understanding of the subjects that they are learning, we have been burdened with an evaluation system that tries to capture too much information.

This same sort of complexity is something that we see very often in companies as they try to measure the performance of their employees. They do this convoluted analysis to try and get to the bottom of what is really important to them; are people really doing what they are supposed to be doing, are they getting the job done that they are being paid for, and should they be replaced? Companies don’t want to get rid of someone if they have potential to grow and it is really hard to find good people, so they come up with these very elaborate ways of trying to measure whether or not their people are performing and usually make it so complicated that in the end, the purpose of the measurement is defeated.

According to the writers of ‘The Balanced Scorecard” Robert S. Kaplan and David P. Norton, “What you measure is what you get” (Harvard Business Review, July-August 2005). They explain that proper measurement of performance in any company has to have a balance, much like the different instruments used to fly a plane and suggest evaluating a variety of metrics to determine the business’ overall performance. This is where things get tricky. You do want to evaluate your employees on different dimensions of their performance but you must deliver the findings in language that can be easily translated into personal growth.

Clarity isn’t the only problem in performance evaluation. Another big issue to watch out for is the competition that can arise from emphasizing individual performance. In fact Wohlfarth and Stevens (2003) wrote in “Creating and Measuring Ways to Win Together” that, “One of the assumptions is thinking that the only way to measure success is on a win-lose basis. Teams need a scoreboard that measures collaboration.” While individual success and achievement is important to measure, people need to understand the importance of teamwork. Providing measurements of how teams are working together can increase levels of organizational collaboration and help raise productivity.

Here are some tips to make sure that your measurement is meaningful and promotes organizational success:

Reduce Complexity

Measuring performance shouldn’t be something that requires an interpreter. Keep it simple and make what you measure and how you measure it clear and consistent throughout the company. When you deliver performance evaluations, make sure your language makes sense and there are clear actionable items for people to work on.

Avoid the Numbers Game

Don’t tell people that they scored a 1.618 on their performance scorecard. Aside from being particularly meaningless, numbers like this aren’t actionable. Use words to let a person know how they are doing.

Get in Touch with the Untouchables

Sometimes a person is valuable because of the way that they are and not necessarily for the things that they do. So many companies place value on getting things done quickly but a fast work pace isn’t the only thing that contributes to the overall success of a company. Identify who the relationship builders are in your organization. Those are the people that smooth out the conflicts, the ones that make people feel good working in the office. It is hard to put a price tag on how much this kind of work is worth but it is an essential function in work place productivity.

Get the Whole Story

You can use assessments and matrices to figure out if your employees are performing but getting the real story from the people that are directly affected by this person is really the way to get to the bottom of things. Make sure your measurements include some questions about how co-workers feel about the person being evaluated. Asking the right questions can give you some deep insight into the performance of the people who work for you.

Be an Olympic Judge

If you are trying to track performance and you are asking people to tell you how a person is doing, make sure to throw out the low score and the high score. Be aware that people tend to over rate their friends, or people that they like and underrate those that they don’t have an affinity to. Take the overly good and overly bad reviews that you might get and take them a little more lightly than the average opinion.

Trend Spot

Whatever method you decide to use to measure performance, make sure to keep your eyes and ears open for patterns. If people’s performances have slipped, that could be a sign that something big is going on in your organization. Avoid the tendency to blame and get to the bottom of things quickly. Declines in performance could signal shifts in the market, or lack of buy in to your company’s product line, marketing strategy, mission, vision or values.

Think Win/Win

Make sure the tone of your evaluation emphasizes cooperation and teamwork. When people feel that they are rewarded for the work that they do instead of the teamwork that they have contributed to, they will have the tendency to want to prove that they are better than others.

Measuring employee performance is a tough thing to do right. On the one hand you want to let people know how they are doing, but on the other, there are lots of things to measure to come up with a proper evaluation. Don’t let yourselves get caught up in the complexity trap. Be clear about what you want to measure and be clear about how you deliver the news. That way everyone will know where they stand.

Cheryl Stein is an Associate Certified Coach, a credential that is designated by the International Coach Federation. For more information, visit Stein Consulting and Coaching.

The Balanced Scorecard by Robert S. Kaplan and David P. Norton, 1996, Harvard Business School Press, Boston MA.
The Collaborative Work Systems Fieldbook. Bayerlin, McGee et. al, 2003, Jossey Bass, San Francisco, CA.