How to handle an appraisal interview

Carol Pritchard, principal consultant at the Penna Meridian consultancy, says some employees are simply shown a pre-written form, and asked to sign it. "And companies wonder why communication is not more open," she says.

But the process can be far more rewarding than this. As the manual for performance management at one of Britain's leading insurers puts it: "The objective is to improve individual performance and behaviour, realise potential and achieve better results."

The starting point, according to Pritchard, is for the company to persuade managers that an appraisal system is a good idea - and that means starting at the top. "If senior managers hate it, that will filter down," she says.

An appraisal interview may be implemented as part of an overall performance management system which is valued by everyone in the company. But even on its own it can become an important tool for motivation.

Penna Change Consulting, which devises such systems for the financial services industry, believes that appraisals should encompass three areas: a review of the past, future goals and targets, and the personal development of the employee.

Principal consultant Chris Parsons says, "There's no point in sticking too much to the past. You should take lessons and apply those to new objectives."

Before the interview the appraisee should complete a short self-appraisal of how he or she has performed against last year's objectives.

The style of the interview itself should be relaxed. "I like to call it a discussion, not an interview," says Pritchard.

The manager's praise and criticism should be as precise as possible. As one manager at a large UK bank says: "You mustn't be too airy-fairy and just say, 'You did a good job'."

The appraisee might of course disagree with the manager's assessment. If a grading system is in use then it makes sense to agree a grade mutually during the interview.

At a leading UK insurer one manager recalls how an appraisee completely disagreed with his grade, which had already been assigned to him. A row ensued, the dispute went to a senior manager who also failed to bring about a compromise and the grade remained in dispute.

The line manager later agreed it would have been better not to assign a grade to the employee ahead of the appraisal interview.

Pritchard and Parsons both endorse 360 degree appraisals where assessments are made by peers of the appraisee, people junior to him, various bosses, and even customers.

Pritchard says: "It's less confrontational, and the appraisee gets a better idea of how he is perceived throughout the company." One rule of such appraisals is that you can only say what you'd be prepared to say to someone's face.

An important part of any appraisal involves setting new objectives. The line manager should have thought out specific new goals and targets and should use the appraisal as an opportunity agree them with the employee.

On no account, insists Pritchard, should either salary rises or promotions be discussed. While an appraisal might have a direct impact on both, they should be dealt with at a separate meeting.

Personal development can also be discussed separately. This involves the employee's aspirations, new skills, training needs, possibly a secondment.

The employee should be encouraged to talk freely, giving the manager an excellent opportunity to see how the employee fits into the future of the company.

Pritchard adds a further element: "right now". Here the employee provides a snapshot of what they are currenly doing, revealing whether they are busy or not, who they are interacting with and whether they are enjoying the task.

"You home in on something really specific which might get forgotten later on. It gives the manager a really good idea of how things work," she says.

After the interview, the manager writes up the discussion and meets for about 10 minutes with the employee to sign off the appraisal.

Some organisations offer a "grandfathering session", when the appraisal is taken to the boss's boss, for a final okay.

Afterwards the appraisee should feel valued. If there are problems, they need to be addressed. "If handled properly, appraisals should be worthwhile and rewarding," says Pritchard.