"Managers don't like it"... "Employees don't like it"... "It takes a lot of time to do it"... "Too much administration"... "Performance cannot be assessed objectively"... the complaints about the process are endless. Probably it is the most debated managerial responsibility nowadays. - Still, I am convinced that there is a better way of doing it but first, we have to understand its role and purpose.

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In a perfect world, all of our employees would arrive at their workplaces on time, they would do their tasks properly and enthusiastically, they would be engaging with each other perfectly, share information smoothly and be able to develop constantly in all of their relevant skills and knowledge fields - without any leadership intervention. BUT! We are not living in a perfect world, the truth is not as perfect as we would like it. So we need good leaders to keep things going. And in doing so, they could rely on a properly executed performance appraisal. This is a very useful tool in the hands of a good leader, but let me return to this a little bit later.

Why do we need it at all?

50 000 years ago in the Palaeolithic Era the world was full of dangers, many forces could have destroyed us. And in this Era, people started to cooperate and rely on each other because this could bring them a sense of safety. Trust and companionship were formed amongst them as a natural reaction to the dangers of the outside world. Belonging to a group, trusting others and safety are very important values in this modern world, too. It is encoded in our genes, we need it. (Our genetical structure hasn't changed during the past few ten thousand years, we have to cope with the challenges of our modern world with a Paleolithic gene set. Therefore our inherent instincts and needs are also the same.)

If people don't feel that they are safe at their workplace, then they will spend most of their time defending themselves. This consequently weakens the organization. So it is an important leadership quality to establish a climate that nurtures the sense of safety in the workplace.

A good leader is very similar to a good parent: he wants his employees to achieve more than he could. Therefore he provides opportunities to develop, increases​ self-confidence and enables autonomy (allows making mistakes and learning from them). And on top of all these ** a good leader is able to initiate and lead good conversations and provide valuable feedback.**

Feedback is also something that we instinctively need. Our first twenty years are spent in a constant comparison: we get grades in the school, we have to collect a certain amount of scores to get access to a university, etc. This is what we are familiar with, this is what we got used to. I have seen an interview with Ophrah Winfrey and in that she ha mentioned that the very same question is asked at the end of every interview, no matter if she was interviewing the President​ of the United States, a college teacher or a pop star. They all ask at the end "was it good?", "did I say something useful?" - we need feedback​, we need to know where we are compared to others.

Google carried out ​research a few years ago trying to find out what is the difference between good leaders and bad leaders. It was called "Project Oxygen". They came up with a prioritised list of 8 characteristics of a good leader (later they added 2 more):

1. Is a good coach
2. Empowers team and does not micromanage
3. Creates an inclusive team environment, showing concern for success and well-being
4. Is productive and results-oriented
5. Is a good communicator — listens and shares information
6. Supports career development and discusses performance
7. Has a clear vision/strategy for the team
8. Has key technical skills to help advise the team
9. Collaborates across Google
10. Is a strong decision maker

If you look at this list, you will see that almost all items have something to do with performance appraisal: coaching employees, empowerment, showing concern towards success and well-being, productivity and result​-orientedness, communication, supporting career development, having a vision for the team are all part of it.

So dealing with development and assessing performance are​ the most important leadership responsibilities. It can motivate people, increases trust, clarifies leadership​ expectations, sets priorities, etc. And in the core of it are good quality conversations and the leader's ability to create a positive climate and to give appropriate feedback. It is good for the employee and also for the company. So it is no question that we need it. The only question is, how can we do it effectively?

In the next part. I am going to summarize some of the common characteristics of performance appraisal systems. Stay tuned!