Do Performance Evaluations Matter?

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Motorola Solutions, Inc. has ended its practice of labeling employee’s performance. Instead of the typical check box method of identifying employees as “meeting expectations,” “exceeding expectations,” or “failing to meet expectations” (or something akin to those labels), Motorola now requires managers to give ongoing feedback and an annual review focused on achievement of objectives. Bonuses are no longer tied to reviews. Instead, bonuses are tied to company performance, with an extra pool of bonus money to reward top performers. It sounds ideal and eliminates some of the uncertainty tied to reviews. However, even without the old school labels, performance evaluations remain the primary means for an employer to “paper the file.”

Without labels, a negative performance evaluation may not affect an employee’s target bonus. That may create an impression that evaluations don’t matter because they don’t affect pay. An employee may be less likely to respond to a negative evaluation if his/her compensation is unaffected. But, no matter how hard we all work to make evaluation systems objective and unbiased, reality is a matter of perspective. If an employee receives a negative performance evaluation, career opportunities can evaporate.

Most employers say that evaluations are expected to be ongoing conversations intended to improve performance. But, most employees read through their evaluation, attend the obligatory review meeting and then put the review away until the next review rolls around. The fact is that most employees don’t respond to evaluations, especially if the evaluation is neutral or positive. However, being engaged when things are going well opens the door for a conversation if things ever turn the other way.

Regardless of whether a review is tied to pay, evaluations still matter. And, not being engaged in your own performance discussion could one day put your employment at risk. Both employers and employees should take initiative in exchanging feedback about performance.