Thursday, October 13, 2011

Three Ways to Evaluate Employee Performance

The best way to monitor performance is by solid, objective measurement. Measurement is the one performance monitoring technique that works.


There are three primary ways to evaluate the performance of your employees. The first two methods listed below usually are less effective than the third. Yet these two methods are the more prevalently used by most managers.


Many managers believe the best way to assess the effectiveness of their employees is through Observation. They feel by observing an employee’s performance and behavior they can assess whether or not the employee is effectively and efficiently fulfilling one’s assigned duties and responsibilities. However, there are some problems associated with using observation as a performance monitoring tool.

First, observations can often be inaccurate. Most observations only provide a brief snap-shot of an employee’s performance at a specific point in time. That brief look may not provide a clear picture of the employee’s true performance. Unless you spend a great deal of time observing the employee in a variety of situations over a lengthy period of time, you may draw some false conclusions about the employee’s performance.

For example, I once witnessed four kitchen workers flipping towels at each other. I became irritated because I thought they were dangerously messing around when they should have been working.

The “snapshot” I saw was of the employees flipping towels. I did not observe what immediately preceded the towel flipping incident. Had I been there to observe what happened right before what I considered to be inappropriate, off-purpose behavior, I would have realized the kitchen staff had just successfully put out the highest volume of meals they had ever cooked in one shift at that restaurant. The towel flipping was them celebrating their accomplishment. Had I responded as my observations led me to believe, I would have chastised the employees for their celebratory behavior, instead of praising them; which possibly could have destroyed their desire to work so hard.

Another time I observed a security officer at a casino hiding behind a bush in the convention area of the property reading the newspaper. I was sure he was slacking off at work. When I saw him in the exact same location at the exact same time the following day I knew I needed to rectify the situation. I called his manager to report the infraction.

When the manager saw who the employee was he turned to me and patiently told me that the employee’s shift didn’t start for another hour. He said the employee always came into work an hour early so he could relax and read the paper before starting his work day. Once again my observations had been wrong.

The second pitfall of observations is that observations may not be relevant to the situation. As previously noted, your observations usually represent just a few frames of the overall picture. Just like a movie preview can often lead to disappointment when the actual movie is not as good as it appeared in the theater trailer, so also your observations of an employee’s performance can give you a false read regarding one’s proficiency. Observations are like judging a book by its cover. What you see may not be exactly what you get.

Managers sometimes wrongly believe that certain observable behaviors lead to specific performance results. One might feel, for example, that a salesperson must get out in the field and physically visit potential customers in order to make sales. But this extroverted behavior may not be necessary. An introvert may be just as successful, or even more so, by contacting customers through less gregarious means.

Third, observation is a difficult way to measure and monitor performance because you often don’t know what to observe. Since there is so much about your employees’ behavior and performance that you could observe; it is often hard to know what you should observe.

Observation entails taking in superfluous information that has no bearing on whether or not an employee is performing well. When an employee sits with his feet up on his desk it is impossible to tell whether he is neglecting his duties or formulating a creative idea in a moment of silent reflection. When a Card Dealer in a casino is not smiling, it may be because she was asked to stop doing so by an unlucky customer who was not in the mood for such cheerfulness.

Conversely, an employee who is feverishly working may be spinning his wheels and not be productive at all. Just because an employee looks like he is working doesn’t mean he is.

Finally, observations are generally negative. Typically, it is much harder for you to “catch people doing things right” than to see what people are doing wrong. It is much easier to see the dirty spot on the carpet than notice where the carpet is clean. It is easier to see the exceptions to the rule and the discrepancies than it is to see exemplary performance. Most managers expect their employees to perform well. Therefore they usually look for examples of where an employee is deficient, not where she is proficient. Errors are easy to spot; competency is not.


The second way to evaluate performance is by using one’s Judgment to determine whether or not an employee is performing satisfactorily. Unfortunately, there also are flaws in using your judgment as a monitoring and measuring tool.

Judgments are typically based upon one’s personal values. Some managers believe employees who come to work early and stay late are dedicated workers. This, of course, may not be the case. A worker who has to work long hours may just be inefficient. Or he could be a “brown-noser.”

You need to be very careful when you identify your expectations of your employees. Sometimes your personal biases can cloud your judgment about what is good or bad, helpful or not helpful, or effective or ineffective at work. Some insecure managers feel their employees are being insubordinate when they question the manager’s orders. Some managers question the loyalty of their workers when they put family obligations ahead of work responsibilities. Some managers feel employees must keep their nose to the grind stone, while others believe they need to provide a fun atmosphere to maintain employee morale. Neither philosophy is necessarily true or right.

Since judgments are values-based, judgments usually remain static and unchangeable.

When one believes as they believe, it is often hard to change those beliefs. A manager who believes an employee is untrustworthy, for example, may find it very difficult to ever trust the employee even when evidence suggests the employee is trustworthy. An employee who commits a serious infraction may find it hard to change the judgment of a manager who refuses to forgive or forget the indiscretion. Black-balled employees seldom return from their banishment. Once judged as incompetent, it is often hard to prove one’s competence.

Finally, judgments can lead to prejudice and blindness.

Many judgments are actually a result of a pre-judgment. Some managers come to quick conclusions about what they see, hear or feel. Their judgments are based upon long-held beliefs.

To pre-judge before gaining solid evidence or proof is prejudicial. Prejudices, by their very nature, entail some elements of blindness. Having judged quickly, it is often difficult to change a person’s preconceived notions without significant evidence or personal involvement to override the prejudice.

I once consulted with a telemarketing firm in the Midwest. As I was walking among the work stations I noticed an employee with a huge butterfly tattoo on his forehead. The wings of the butterfly wrapped around his bald head. I was absolutely amazed. I have an opinion about people who have butterfly tattoos on their foreheads. They are not at the top of my list of ideal employees. Yet, when I suspended my judgment, I realized the customers of the telemarketing firm had no way of knowing what this phone solicitor looked like. Nor did they care. For all I knew the butterfly guy could have been the top performer at the company. Judgment is a poor indicator of whether or not an employee is performing well.


The best way to monitor performance is by solid, objective Measurement. Measurement is the one performance monitoring technique that works.

Actual performance measurement is a more effective way to evaluate performance because measurement is relevant to the situation or process. When you measure performance you look at a specific situation or step in a process and assess your employee’s progress accordingly.

Measurement assesses an employee’s performance now, in this situation, under these conditions. It does not matter how well a basketball team performed last week when they are facing a new rival this week. How employees perform at another company may or may not be relevant to how your employees perform at your company. Your performance measurements must be uniquely tied to the distinct conditions of your work areas and they must be designed around the specific conditions of your business.

Measurements are conducted in exact terms and real numbers. Stating that you want to increase production by 200 units per day is much more effective than saying you want to increase production by 20% per day. People have difficulty grasping abstract information. The more specific and succinct your measurement criteria, the more likely your employees will succeed at achieving the results you desire. Measurements that are easily counted count more than obscure indicators.

Performance measurements focus on results, not behaviors. Sometimes managers get caught up in how their employees perform rather that what they produce. Too much focus on how work gets done, rather than what gets done, can often lead to an emphasis on work processes rather than work results. In most cases how an employee performs doesn’t matter. The issue is whether or not they achieved the desired outcome.

In many cases you actually should ignore the behavior of employees because it has very little bearing on actual performance. Behavior is difficult to measure because much of it is covert. How “hard” employees work, for example, may have no relevance on the results they achieve. Some students get straight A’s with very little effort while others studiously pour over their textbooks and still get a C-grade on the exam. A soldier may hold his rifle “wrong” and still hit the target accurately. Likewise, as mentioned earlier, some employees can appear to be working hard when they really are not. Behavior is only relevant when results are not being achieved; and even then behavior may not matter.

Measurement provides a way to win. The measurement indicator tells the employee exactly how to score. It tells her what really counts. Specific measurements show specific accomplishments. When you measure performance it is very clear what is achieved and who achieved it.

Measurement criteria should be set around the goals, objectives and expectations you’ve established for the employee. In another article I wrote, entitled “How to Establish Clear, Specific, Measurable Performance Goals”, I outline nine measurement categories you can use to measure every element of an employee’s performance. You should constantly monitor the employee to ensure she is performing as expected and achieving the results you want. And, of course, you monitor the employee’s performance by evaluating her results against the measurement criteria you’ve established, not by observing or judging her behavior. §

Innovative Management Group offers a variety of executive, manager and supervisor training programs on performance management issues. Please contact us for a list of the customized training courses we offer.

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