Rethinking Performance Appraisals: From a Mandatory Task to a Meaningful Conversation

For most employees and managers, the annual performance appraisal is far from a highlight of the year. When asked why, their responses typically fall into three categories:

1. It Feels Like a Waste of Time

• Neither the employee nor the manager is adequately prepared.
• Follow-up is either insufficient or nonexistent.
• The pressure of daily tasks leads to a “we don’t have time for this” mindset.

2. It’s About Evaluation, Not Development

• The focus is on past performance rather than future potential.
• It prioritizes competencies over job satisfaction, purpose, and motivation.

3. It’s Just a Policy, Not a Priority

• Appraisals happen because they’re required—not because they add value.
• The results often go unused, making the entire process feel meaningless.

The Cost of a Flawed Process

In a company with 200 employees, the annual appraisal process is a major resource drain. Let’s break it down:

• Interview: 1.5 hours per employee
• Manager’s preparation: 1 hour
• Employee’s preparation: 1 hour
• HR administration: 0.5 hours

That adds up to 800 hours—the equivalent of one full-time employee working for five and a half months—dedicated to a process that most consider ineffective.

So, is it time to rethink how we approach performance appraisals?

The Easy Way Out: Stop Doing Appraisals Altogether?

One obvious solution would be to eliminate them entirely. Why waste time and money on something that both employees and managers find pointless?

But there’s another option: Instead of scrapping appraisals, we can redefine their purpose—shifting from a box-ticking exercise to a meaningful development conversation.

The Missing Piece: Motivation

Traditional performance appraisals focus almost exclusively on competencies. But that’s only half the equation.

Consider these two employees:

1. Highly skilled but unmotivated – They have the right competencies but lack direction and engagement.
2. Highly motivated but lacking skills – They’re eager to contribute but need development.

Neither will ever reach their full potential unless both motivation and competencies are considered together.

A New Approach: Measuring Motivation

If we accept that performance = competencies + motivation, why not apply this mindset to performance appraisals?

Imagine if, before each appraisal, employees could:

• Measure their individual motivation levels
• Identify their unique motivational drivers (needs and talents)

With this insight, managers could have more valuable, targeted conversations—transforming appraisals into a tool for real development rather than a mere formality. As a customer explains it:

“Motivation Factor sparks meaningful conversations, helping employees and managers understand key motivational drivers. This insight strengthens retention – exactly what We need right now.“

How to Make It Happen

Contact Motivation Factor for more information.

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