A whopping 94 percent of chief financial officers surveyed by Accountemps said they believed that “formal evaluations are either somewhat or very effective in helping employees improve their performance.”
Workers, however, have a little different perspective in this survey, with 31 percent calling performance reviews “either somewhat or very ineffective.”
Surprised? I was, primarily about CFOs being in such lockstep agreement over the value of appraisals, and, because it’s hard to get 94 percent of people in the workplace to agree on just about anything, much less something that gets batted around as much as the value of performance reviews.
How employees and CFOs were split
Here’s the full breakdown between the two groups, and perhaps this will give you a little more sense of the split opinion between employees and their CFOs
CFOs were asked, “In your opinion, how effective are annual or semiannual performance reviews in helping employees improve their performance?” Their responses:
- Very effective — 26 percent;
- Somewhat effective — 68 percent;
- Somewhat ineffective — 4 percent;
- Very ineffective — 1 percent;
- Don’t know — 1 percent.
Workers were asked, “In your opinion, how effective are annual or semiannual performance reviews in helping you improve your performance?” Their responses:
- Very effective — 25 percent;
- Somewhat effective — 37 percent;
- Somewhat ineffective — 16 percent;
- Very ineffective — 15 percent;
- Don’t receive performance reviews — 6 percent;
- Don’t know — 1 percent.
Is the CFO response wildly out of sync?
It’s unclear just why CFOs put such value into performance reviews, but I suspect it has something to do with their want to quantify everything to the greatest extent possible. Appraisals are, after all, one way to quantify the quality and performance of what is, for most organizations, their single biggest cost — their people.
For workers, it seems that they are much more negative about the process because, in all-too-many companies, performance reviews are poorly handled and seem like an afterthought.
The process improves dramatically when an organization invests in an automated talent management system, but only about 25 percent of businesses have done so. Some 75 percent of organizations still are stuck with manual methods to handle and process evaluations — or, they don’t do them at all.
What struck me about this Accountemps survey was that the response from CFOs about the effectiveness of performance reviews seems wildly out of sync with what everyone else in the workplace seems to be saying about them.
‘Everyone hates getting performance appraisals”
A few weeks ago, I asked a large room of recruiting professionals at a conference to raise their hands if they felt that traditional performance appraisals were a reliable and consistent way of measuring performance. Not one hand went up. Not one. Houston, we have a problem.
If you want to get to the bottom of issues with the traditional performance appraisal, you have to do some research into both its effectiveness and its application. When you ask people about this practice, you will find out three things. In general:
- Employees hate getting performance appraisals.
- Managers hate preparing and giving performance appraisals.
- HR hates administering the performance appraisal process.
The use of the word “hate” is deliberate. The feelings about performances appraisals aren’t passive in a “take it or leave it” sort of way.
It’s an emotionally-fueled hatred. The hatred flows from memories of pain, fear, and perceived injustice. And yes, even HR pros, who are generally blamed for the existence of this process, seem to despise it and resent that they are saddled with its implementation each year.”
More fuel for the ongoing debate
That’s a pretty tough assessment of the performance review process, yet the greater majority of the comments that people left on the article agreed with what Jason Lauritsen had to say. No one responded with a comment that said anything like, “yeah, you may hate them, but more than 90 percent of CFOs think they’re great.”
This is an alarming disconnect between CFOs and everyone else in the organization, and it would be great for any CFO out there reading this to leave a comment (or, perhaps offer up a rebuttal blog post) that gets into why that is.
The surveys of CFOs and workers were developed by Accountemps, which bills itself as “the world’s first and largest specialized staffing service for temporary accounting, finance and bookkeeping professionals.” It was conducted by an independent research firm, and the survey of chief financial officers is based on telephone interviews with more than 1,400 CFOs from a “stratified random sample of U.S. companies with 20 or more employees.” The employee survey includes responses from 422 working adults 18 years of age or older and employed in office environments.
My guess is that this Accountemps survey will just fuel the ongoing debate over the usefulness of performance reviews, as well as the trend that has HR reporting more and more to the CFO rather than the CEO. Yes, it will probably just add more fuel to the fire of those debates.