The performance review has been a staple of working life for an incredibly long time now, and despite recent advances that enable such events to occur on an ongoing basis, they are still generally conducted on an annual or semi-annual basis.

A recent paper from researchers at Rice University highlights how futile feedback is if it’s not delivered in a more timely manner.  It goes on to discuss how the culture and environment within an organization can hinder more frequent and ongoing forms of feedback.

“The key really is accuracy in the ratings managers give their employees,” the authors say.

The paper highlights that managers are often very reluctant to demotivate employees by providing appraisal ratings towards the lower end of the rating scale, even if that is an accurate reflection of their performance, hence ratings tend to cluster towards the top end in most organizations.

“Organizations by nature are large social environments, and we cannot forget that context when making use of performance-rating data,” the authors say. “We think that the critical factors of interpersonal relationships and interpersonal politics in an organizational environment may have a profound influence on a company’s review process. But these factors are typically under-researched.”

The challenge of giving negative reviews

Given the social context of both the modern workplace and the peer appraisal systems, it is often extremely challenging, not to mention discomforting, to provide a negative rating to a colleague.  In many ways, it’s extremely sensible NOT to give negative feedback, no matter how much its warranted, because of the compromise it would place on your day to day working relationship.

“Likewise, supervisors and co-workers may have a difficult time transitioning from being inspirers, motivators or even friends to being judicial evaluators of employees,” the authors note. “Regardless of the nature of the organization, it is no surprise that raters will often tread carefully in ways that avoid negatively affecting their long-term relationships with those people whose performance they have to rate. Anecdotal evidence has shown that interpersonal political considerations are nearly always a part of the employee review process.”

The whole process is also challenged by the infrequent interactions many managers have with their team.  This often prompts employees to know full well that when they do interact with their boss, they have to be on best behaviour, thus creating a false impression and making it very hard to identify real areas for improvement or growth.

“The nature and amount of interaction between managers and employees affects the performance dimensions on which raters have useful and accurate information,” the paper reveals. “These interactions – like any interpersonal interaction – likely affect how naturally employees performs in front of the rater, whether performance is alone or on a team.”

The potential of informal performance management

Whilst there isn’t a huge amount of research in support of informal performance management, the authors are nonetheless believers in its potential.  They note that whilst few organizations are completely without any politics, such informal, peer based performance review systems can thrive in environments that are open and non-threatening.

They go on to reveal that they believe the kind of constant feedback that occurs in such an environment on a daily basis is much more likely to elicit the behavioral changes that the feedback is designed for in the first place than the annual performance sessions that continue to dominate.  Informal feedback is regarded as a much more natural process, and because it isn’t expected is much more valuable.  It’s important, therefore, to create a culture and environment where employees feel comfortable delivering that kind of feedback.