When completing performance reviews, psychologists and researchers alike agree that managers naturally exhibit bias in the ratings. To be fair and objective, a performance evaluation must be based on the employee’s job-related behavior, not on the employee’s personal traits, work situation, or other factors unrelated to employee performance. While subjectivity and partiality will never be completely removed from the process, it is important to keep some of our most common prejudices in mind when completing performance reviews.
Below is a “Top 10” list of the more frequent rating errors/biases in the performance evaluation process:
- Excessive Leniency - Excessive leniency occurs when the manager rates all employees higher than their performance warrants in an effort to be kind, supportive or well-liked. Sometimes the manager’s underlying motivation is the belief that an underperforming employee will be motivated by a positive performance review, and perhaps will begin to exhibit the work behaviors described in the evaluation. Other managers simply prefer to take the path of least resistance, as a highly positive review makes for a very pleasant performance review meeting with the employee. However, it is important to accurately rate each employee according to their performance during the rating period. When one or more managers exhibit this bias, it may render the entire performance evaluation system ineffective.
- Excessive Severity - Managers tend to demonstrate severity bias when hoping to motivate average-performing employees. A manager with this bias tends to rate all employees lower than their performance warrants in an effort to inspire average employees to improve their performance. However, an unfairly low review often results in the reverse effect and compromises the performance evaluation system.
- Similar-to-Me Bias - This bias occurs when the manager gives higher ratings to employees who are similar to the rater. We tend to like and relate well to people who remind us of ourselves; however, this resemblance should not spill over into performance review ratings. For example, if a young employee who just graduated from your alma mater reminds you of yourself at that age, you may unintentionally provide the employee with higher ratings than he has earned.
- Opportunity Bias - Opportunity bias transpires when the manager either credits or faults the employee for factors beyond the employee’s control. Managers stricken with the opportunity bias praise or blame the employee when the true cause of the performance was opportunity or a lack thereof. An example of this bias is a manager rating a sales employee favorably overall due to one big sale obtained by a stroke of luck, rather than through normal sales channels such as meeting cold-calling and prospecting goals.
- Halo Effect - The Halo Effect occurs when an employee possesses one, exceptional strength, and the manager allows this to carry over into other rating categories or to dominate the overall evaluation score. For example, if an employee excels in the category of “job knowledge,” it does not necessarily follow that the employee excels in the categories of “attendance” or “work production."
- Horns Effect -The Horns Effect occurs when an employee has one hindering weakness, and the manager allows this to seep into other rating categories or the overall outcome of the employee’s performance appraisal. For example, if an employee is especially weak in the category of “customer satisfaction,” it is not necessarily true that the employee may also need to make improvement in the categories of “job knowledge” or “problem solving.”
- Contrast Bias - A manager afflicted with this bias tends to compare performance to other employees rather than comparing performance to an established company standard. It is important that the manager does not consider the performance of other employees in an attempt to “rank” employees in the performance review process. Every employee deserves his or her performance review to be based solely on individual performance, not performance as compared with other employees.
- Recency Bias - Recency bias occurs when the manager bases the evaluation on the last few weeks or months rather than the entire evaluation period. It is important to consider the employee’s performance during the entire review period when completing the performance review form.
- Job vs. Individual Bias - Some jobs seem to be more vital to the organization than are others. A particular job may be crucial to the company’s success. However, it does not necessarily follow that the employee is performing well in that job.
- Length of Service Bias - It is important to remember that length of service is not a factor in evaluating performance. Therefore, long-term employees should be evaluated according to the same established standards as other employees.
It’s a great idea to take a look at these and assess your own biases prior to completing performance evaluations. It is also important to review these common biases with your management team prior to the commencement of performance appraisals, so that your performance reviews are more accurate and objective in nature. When you are able to remove some of the bias from the evaluation process, performance appraisals become much more meaningful for organizational decision-making and compensation adjustments. In addition, they become much more useful to the employee in assessing valid areas that need improvement.