Performance Appraisal Rater Errors

Posted on November 14, 2011 by Katherine Razzi

As human beings, we are subject to unintentional errors that we are often unaware of. Performance appraisals are a common area where our human tendencies can appear full force. Because we know that rating errors can occur, what do we do about it? Obviously we cannot change people’s unconscious thoughts and ways of thinking, but what we can do is train raters to be aware of his or her own biases. Once raters are aware of biases to avoid, performance appraisals can be much more accurate.

One of the most common rating errors is known as the halo effect. Halo effect occurs when one particular trait about someone causes us to either rate that person very high or very low on performance appraisals. For example, physical appearance often impacts the perception a manager may have of a subordinate. Therefore, because an employee is physically attractive, this individual may receive all high scores throughout the performance appraisal system. Why is this a problem? When a rater gives ratings to an employee because of a trait or characteristic, the rating is not accurate. Just because someone is physically attractive does not mean they deserve high scores across the board. Unfortunately, the halo effect is typically an unconscious judgment. As a manager, I may not even know that I am rating employees differently based on personality or physical appearance. However, if I receive the right training, I am more likely to think about the scores I am giving employees.

A second common error is known as the leniency error. This error is often made in an attempt to avoid conflict. Performance appraisals are an uncomfortable situation for both managers and employees. Managers do not always enjoy giving negative feedback and employees do not like receiving negative feedback. To avoid the awkward situation, some managers will not rate employees accurately. Instead, managers give high ratings to all employees to avoid looking like the bad guy. Although performance appraisal meetings induce anxiety on both the manager and the employee, giving an employee high ratings when they are not deserved does not help employees improve his or her performance. A poor performer that receives high ratings will not change his or her behavior because areas of improvement are not addressed.

Central tendency error occurs when a rater does not give high or low ratings, but tends to stay in the middle of the rating scale. Similar to the leniency error, managers that rate employees in the middle do so to avoid conflict with employees. Rather than rate a poor performer at the lowest spectrum of the scale, many managers feel they are being more fair if they rate the individual in the middle of the scale. Again, employees are not getting a true sense as to how his or her performance is rated.

Lastly, similarity error can have a very negative impact on certain employees. Social psychology tells us that we tend to gravitate toward people that are similar to us or birds of a feather flock together. We like people who are like us. In conducting performance ratings, managers may be giving higher ratings to employees who are similar to them rather than giving an accurate rating. Another way this error can be interpreted is through in-groups and out-groups. In-groups can form based on personality similarities or common interests. Out-groups are those individuals that do not seem to fit into the norm or in-group. A manager may unknowingly rate a member of their in-group higher compared to a member of the out-group.

When thinking about performance appraisals, it is essential to look at the rater. If performance appraisals are to be helpful, they must be accurate. When a manager is subject to one of the rater errors, the rating is not a clear indication of the employee’s performance. Therefore, training raters to consider these rating errors may help to eliminate inaccurate performance appraisals.

Have you seen these errors in practice? How can we combat them?

About Katherine Razzi

Katherine Razzi hails from the Midwest and holds a B.A. in Applied Behavioral Science from National-Louis University, Evanston Campus. Career-wise, Katherine has worked as a commercial artist for many years up until she received her degree from NLU. Coursework includes intense studies in cultural diversity, management, organizational dynamics, morals and ethics, group interaction, and psychology. Working at TNS Employee Insights has given Katherine the best of both worlds where she can be of service with her vast experience as a graphic artist, and her education, topped off with plenty of life experience. Aside from creating paper surveys, Katherine now enjoys writing blogs and other marketing collateral for TNS Employee Insights.

What Others Are Saying

  1. Katherine Razzi November 14, 2011 at 4:45 pm

    Hi Gail,
    Thanks for writing this informative post.
    I can understand the social psychology here in each situation. I can only imagine how hard it must be for a manager to play devil’s advocate during a performance review with one of his or her subordinates. I can see how these obstacles to a productive, effective and valuable performance review can be highly detrimental to the employee. However, a manager’s job is not a popularity contest. A manager’s job is to help his or her subordinates improve the quality of their work with the hopes of higher pay or a possible promotion.

    If one receives a mediocre or even a great review, I think it is up to that individual to ask, “Thank you for the wonderful performance appraisal. How will it help me to move ahead in this company?” If the employee receives a stuttered response with nothing noteworthy to take to the bank, I would think that might be indication that a) the manager didn’t think through the review well enough, b) the manager’s perceptions of the employee was blocked by prejudice, good or bad as you cited in your blog, c) the manager is placating the employee so they will remain employed at the current pay rate.
    If it is the ambition of an employee to move ahead in the company whether by taking on more responsibilities or trying to achieve a higher level with more pay, a manager should take the time to groom the employee so that they can better themselves. That may require a very critical review. I would like to think that most managers do not enjoy giving harsh critiques of their subordinates’ work, mainly because it could be a poor reflection of their own deficiencies in their daily management style, but most certainly because it’s a hard thing to have to do.

    After reading your post, I am now thinking that a mediocre review is pretty stifling to one’s career. I don’t want a bad review, but I’m going to really think twice before I sign off on one of those mediocre reviews and ask the manager, “How can I move ahead here? I want a direct plan as to what I need to do to get there and a time frame. What do I have to do to improve, start or stop doing? Please be honest.” If nothing solidifies after that, and you are hell bent on getting a promotion, it may be time to go through the chain of command. If nothing happens after that, then I’d say it’s time to seek greener pastures elsewhere.

    And always remember – it’s YOUR review, not your manager’s. This is the perfect time for you to take advantage of accepting criticism, asking your manager for tips on how you can improve your performance, and asking questions how you can work up the rungs to a happier existence at work.

    • Gail Cengia November 15, 2011 at 9:28 am

      Kathy,

      You raised some great points in dealing with performance appraisals. The relationship between the manager and employees greatly impacts how the manager rates an employee. As I have looked further into performance appraisals and the impact of rater errors, it is discouraging to find that the ratings we often receive may not truly be accurate. I have certainly thought back to ratings I have received and asked myself the question, “Did I truly deserve these ratings or were they given to me just because the manager felt bad or like me?”

      It seems that the element of complete honesty is often missing in performance appraisals. A question that I continuously ask myself as a graduate student is how can the accuracy of managers ratings be improved to truly reflect employee performance and behavior? And it seems that the answer to this question is murky.

      I agree that performance appraisals are the perfect opportunity to accept criticism and improve one’s performance and skills. I am a true believer that feedback should be given more often rather than once a year as many organizations do. Feedback should be given shortly after either good or bad performance is performed. Then the employee has an opportunity to quickly correct behavior or performance rather than hearing a long list of things he or she did poorly on during the once a year performance appraisal.

  2. Jocelyn November 21, 2011 at 3:15 pm

    Thanks for this informative read, Gail! These are very real and very unfortunate issues in the modern workplace that we all deal with.

    It’s certainly an imperfect system that is in place. Fortunately there a lot of folks out there who think that the current systems in place for reviewing workers is in an antiquated one and that this process will look very differently in the future! I think you might find this article/infographic not only interesting, but heartening! In fact, I’d really love to hear your thoughts!

    http://mashable.com/2011/10/29/job-performance-reviews-social-infographic/#comment-17779495

    Anything to avoid this kind of unfair judgement, yeah? I am so one for a utopian world where we are all really judged fairly and based upon our real merit–and not our looks! Sigh. There has got to be a better way.

    • Gail Cengia November 21, 2011 at 9:07 pm

      Jocelyn,

      Thanks so much for reading our blog! The article you gave me the link to was a great history of how performance appraisals have evolved from bad, to good, to bad. The article does a great job breaking down how different performance appraisals have been either accepted or denied by employees and managers. I think the management by objective performance appraisal is the best type outlined in the article. Using goal-setting has been time and time again proven to increase employee performance and ultimately has very positive outcomes for the organization as well.

      To answer your other question about how unfair judgment can be avoided, the answer is not easy. Speaking purely from an academic view, as my experience with performance appraisal systems in the workplace is rather limited, I think the best way is to train employees. Many organizations currently integrate performance appraisals into training sessions. I am like you, I wish everyone could always be judged fairly, but of course that exists only in a perfect role. As human resource employees or I/O psychologists, the best thing we can do is to train employees about types of biases. The more raters know about fair ratings, the better. It is also up to the organization as to how performance appraisals are presented. If an organization does not have a strong belief in the accuracy of performance appraisals, then employees may not take the system seriously. However, if an organization displays performance appraisals as important, the hope is that employees will follow suit.

      Gail

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