“Best practices” in CEO performance evaluation is a never-ending discussion. But with all things, there are no real best practices – only those that are effective and those that are not.
We have found that a well-conceived formative appraisal process (as opposed to summative) creates a useful information base that draws attention to things that colleagues ought to be having frequent conversations about. It helps focus attention on the things that are considered important in the organization. Conversely, poor processes cause confusion, duplicate effort, and diminish confidence in the value of the time invested.
Culture will define how the performance assessment process is viewed. For example, in the few larger companies abandoning balanced evaluations, employment decisions are made primarily on the basis of the achievement of monetary targets. This is not surprising since making money is the thread that holds the fabric of a for-profit business together.
In associations, performance appraisal is often a reflection of how members are evaluated in their own workplaces. At the chief staff executive level, the performance evaluation approach usually reflects whether the exec is perceived or treated as a CEO (leader) or a general manager (administrator). This topic is re-emerging as an important issue among ASAE’s Symposium for Chief Executive and Chief Elected Officers as the demography of association Boards shifts.
We find that in successful cultures, the interests of the organization and the interests of the individual are treated with the same respect – even when they are not compatible. Promoting individual satisfaction and contribution to organizational purpose are NOT mutually exclusive. To pretend that they are not interrelated ignores both research and experience.
A balanced performance evaluation process considers three dimensions:
- achievement of objectives,
- fulfillment of job responsibilities, and
- demonstration of professional competencies.
The holistic view of performance resulting from both formal and informal attention by the “evaluatee” and the “evaluator(s)” provides a rational base for both employment decisions and performance improvement at the individual, group and organizational levels.
Like most things in complex organizations, performance evaluation will never be perfect. But, it can be better. For a free list of design specifications to guide development or assessment of performance appraisal processes just email me at email@example.com.