Appraisal of employees often gets a bad press, but recent research suggests if it involves frequent feedback between formal appraisal meetings and good prior planning and communication of standards then it can be successful and appreciated by employees.

The research, conducted by myself with two US colleagues, Shaun Pichler and Gerard Beenen at the California State University, Fullerton, shows that acceptability of appraisals is enhanced when feedback is frequent and standards are set and clear to employees. These two features also have a synergistic relationship, so feedback has a greater effect when standard setting is good. The research is based on a meta-analysis of existing research, that is a statistical analysis of the studies of appraisal that include feedback.

This evidence is consistent with the due process theory of performance appraisal associated with Robert Folger, a Business Ethics Professor at the University of Central Florida. The principles of the due process of law, which are prescribed by the Fifth and Fourteenth Amendments to the US Constitution, include adequate notice (notification of charges and proceedings), a fair hearing (one can present evidence on one’s behalf and prepare a legal defence) and judgement based on evidence (judgements that are impartial, free from bias). In the context of performance appraisal, setting standards or expectations in the planning stage and giving feedback between this stage and the formal appraisal provide the adequate notice dimension of due process. The remaining due process criteria – fair hearing and judgement on evidence – are fulfilled through the appraisal itself, appeals procedures, and ensuring judgements at all stages are based on relevant evidence.

Frequent feedback provides information that allows individuals to determine how well or poorly tasks have been done and facilitates discussions between a manager and the appraisee in order to enable change between the planning stage and the formal performance appraisal review. This can be change in employees’ behaviours, attitudes or orientations, their job characteristics, or the wider organizational context.

As it fulfils the adequate notice dimension of due process, the provision of frequent feedback should increase the likelihood that the appraisal process is seen as procedurally and interpersonally fair. The theory is that feedback generates favourable reactions to appraisal because it facilitates employees’ learning and error correction, gives them a greater sense of control over the appraisal process, and should increase the extent to which the appraisal is based on valid and accurate information.

Equally good standard setting fulfils the adequate notice dimension of due process. Knowledge of performance standards should increase the acceptability of appraisals since it ensures that employees can effectively prioritise and accomplish their work, which is especially important when employees have multiple tasks and goals. Without the provision of this knowledge, due process theory suggests that employees should not be held accountable to performance standards. Increased knowledge about the appraisal process creates shared understandings between the parties and improves employees’ justice perceptions. Knowledge of performance standards enables employees to match their work performance to a level required for optimal rewards; and the evidence is that goal achievement and progress towards goals, not goal-setting itself, positively affects well-being.

The use of appraisal has grown substantially in the last two decades in Britain to the point that it is almost ubiquitous, and certainly the days when it was limited primarily to managers or only a handful of organisations like Nissan which appraised all their employees are gone.  Yet, all too often appraisal is treated as a once-a-year ritual or conceived as monitoring people’s performance, which does not entail feedback or good standard setting processes. The research suggests that appraisal is unlikely to offer much for employees without these features.

The implications for practice are that rather than abandoning appraisals or continuing to treat that as annual ritual, organisations and employees will benefit from implementing both aspects of the adequate notice dimensions of due process. Moreover, performance feedback should concentrate on employee development, as well as error correction, if it is to facilitate gains in the job satisfaction and performance of employees. It is important that in the feedback and standard setting potential trade-offs between goals is acknowledged. And the existence of multiple or conflicting goals is not used to justify a fatalistic approach to appraisal, that it can never really be much use. Standards make appraisal and feedback easier so the appraisal does not need to focus on the person; they can be defined as ideals and not obligations so the appraisal can focus on development and not ensuring obligations have been fulfilled.

With well communicated expectations and good quality feedback, appraisal can be transformed from a tool of performance management to a potentially vital high-involvement or participative management practice. Just as feedback transforms the traditional attitude survey to a high-involvement management practice – the survey feedback method – so feedback transforms appraisal. Name changes may help, for example from appraisal to personal development reviews or the personal development cycle. More generally, appraisal illustrates that a management valuing employee involvement will design personnel practices according to that principle and not simply pick from a set of best practices as for example prescribed in the high performance work system vogue or a performance management manual.

Professor Stephen Wood is Professor of Management at the University of Leicester. [email protected].

This research is presented in: S. Pichler, G. Beenan, S. Wood, Feedback Frequency and Appraisal Reactions: A Meta-analytic Test of Moderators, The International Journal of Human Resource Management. DOI: 10.1080/09585192.2018.1443961