One morning Tim found a note in his mail box at the co-op when he arrived for work. It read, "We'll be here to do your evaluation at 4:30 today. See you then." It had been nineteen months since his last review. He was aware that his evaluation was being discussed -- several employees had received a form for rating his performance and there had been a few confidential meetings recently. But no one had asked him for an assessment of his own performance. As the time approached, he grew more apprehensive. On what criteria would he be evaluated? Who would be at this meeting? What should he bring or prepare? He had nothing to review in advance. What could he expect?
How would you feel in Tim's shoes? Is this the way you want co-op employees to be treated? Does this sound to you like a working relationship based on trust and respect? As a board member, would you be satisfied with a general manager who handled employee evaluations this way?
In fact, Tim is the general manager of a co-op; his evaluators are the members of a co-op's board of directors, and the scenario described is all too typical. As usual, the board of this co-op is made up of a diverse group of busy people, most of whom have very limited experience in business or as supervisors. Moreover, evaluation by committee, without strong leadership or oversight by one director, often leads to a less than ideal experience.
No doubt about it, a board responsibility
Providing feedback, informally and formally, to the general manager on his/her performance is at least as important as hiring the right person. Without a doubt, it is one of the most important functions of the board -- and one of the board's responsibilities that simply can't be delegated. A good manager evaluation completes the accountability loop -- a loop that begins with members electing directors to set direction and monitor the co-op for them, continues with the board hiring a manager to handle operations, and ends with the board providing feedback on the manager's performance.
Of course, managers deserve the professionalism, time, and deference you expect them to give all co-op employees. A constructive evaluation will be well planned, with the steps to be taken delineated and clearly understood. The acid test of a good evaluation is this: would all of the directors and the manager be able to succinctly summarize the key points and agreed upon goals from the evaluation five months later?
A general manager's evaluation isn't worth the paper it's written on if it doesn't identify areas of strength and areas for improvement, set goals for future performance and, ultimately, improve communications between the board and the manager. Furthermore, evaluations can help a board guide the professional development of a general manager they wish to retain for the long term. And, in those rare cases where the manager is unmatched to the job, a professional and thorough review can make clear to the board and manager alike the need for change of management.
The basic bias of the board toward the manager is reflected in the way the manager's evaluation is handled. If the board doesn't trust the manager, that mistrust will be revealed in the approach used by the board in conducting a review. Make no mistake -- manager evaluations aren't easy. A wise board will recognize if or when it needs to get outside help to do it right.
What managers like and don't like
In an informal survey of co-op managers, most expressed the following: their boards are conducting annual evaluations, though they are often several months late; the evaluation process often includes an extensive collection of input from co-op employees; most evaluations aren't traumatic to the manager, though uncertainty about what to expect can be stressful and distracting; and managers often have to ask for more specific information or written documentation in order to clarify the results of an evaluation.
All managers surveyed sincerely expressed appreciation that they are getting some feedback -- many remember years without evaluations and are happy that those days are passed. In addition, most managers appreciate the willingness of their boards to consider suggestions for improving the evaluation process. Most are pleased that some input is collected from employees, though how these comments are used in the evaluation process and how they are relayed to the managers can be confusing or frustrating.
What managers dislike most about their evaluations are the following: surprises; no synthesis or summary of comments or ratings to reflect the board's overall opinion; apologies for sloppy evaluations; receiving nothing in writing to review prior to meeting with the board or a committee; secretive or rigidly orchestrated process; decisions made without any consultation or discussion with the manager; no written summary of evaluation results; and too much focus on details instead of goals and targets.
An ideal evaluation process
When managers were asked to describe an ideal evaluation process, they focused on relatively simple things. Managers universally want evaluations that are in writing and materials that they can review before having to discuss or react to them. They want a dialogue, rather than just a monologue from the board. And, in addition to a procedure that is clear in advance, most managers like to be involved in planning the forms and process to be used.
Concerning employee input, most managers find it very valuable to know what employees think and where they would like to see changes. However, many managers described forms or methods for collecting and reporting employee comments that overemphasized personal gripes and unconstructive grumbling about past management decisions. Managers would like to see employee opinions collected through some sort of regular survey process and summarized to highlight general trends, either by the co-op's personnel manager or by outside professionals.
Managers found it difficult to grasp the overall results of their reviews when all evaluators' comments are simply presented as a compilation -- not synthesized to reflect the total and agreed-upon opinion of the board. To managers, seven comments that range from "this is an area of strength' to "this is unacceptable and needs improvement" don't provide much guidance. Instead, managers would prefer that the board discuss the range of its responses and agree what opinion will be expressed to the manager -- to reflect the totality of the board's perspective so that managers can make changes accordingly.
In addition, managers consistently expressed the desire to focus their evaluations more on goals and objectives and less on personalities. Boards put far too much emphasis on the relationships and inner workings of the workplace and not enough on the business results. The overall focus of a board's review needs to be on setting goals for the manager, not on the methods or techniques to achieve those goals.
Guidelines for constructive evaluations
Fortunately or unfortunately, the manager's evaluation process clearly reflects the tenor of the working relationship between the co-op board and general manager. When evaluations result in surprises, suspicions, unilateral decisions, or unexpected outcomes, the board! management relationship will inevitably suffer. Both directors and the manager can affect the experience and the outcome of an evaluation positively.
Constructive general manager evaluations are always:
- in writing
- conducted at least annually
- focused on job performance not on personalities
- candid and honest
- planned with the involvement of the manager
- based on a clear and agreed-upon process, and
- focused on future areas of action or goals for
Steps for Manager Evaluation
These steps, beginning about three months before the evaluation process is to be completed, will help guide a board through a clear and constructive process:
1. Review by the board (or a board committee) of the procedure to be followed and outline of basic steps. Refer to notes from previous evaluations in preparing forms and steps. Plan administrative details such as who will compile evaluation comments, who will meet and discuss the results with the manager, and an overall timeline for the whole process.
2. Discuss the upcoming evaluation steps and forms with the general manager. If forms or specific steps need to be revised or developed, ask for the manager's' input or for the manager to draft something for the board to adapt or approve.
3. Distribute evaluation forms to all directors with clear instructions regarding when and to whom they must be returned. (Give directors 2-3 weeks to complete the forms.) If the board wants input on aspects of operations with which it is unfamiliar, collect such comments from department managers by using a separate form.
4. Compile comments and ratings from all directors (done by one director or an outsider). General manager also completes and turns in a self-evaluation.
5. Copy and distribute to all directors a compilation of all directors' verbatim comments and the manager's self-evaluation. Directors review all input and prepare to discuss what the overall ratings and primary comments in each area should be.
6. Directors meet in executive session (all directors present, no one present except directors and maybe the outsider/compiler) to review compilation and manager's self-evaluation. Directors discuss and reach agreement on the board's overall statements and ratings, including general goal areas.
7. Prepare written materials providing the board's overall ratings and comments and summarizing major areas for discussion. Give a copy to the general manager.
8. A board committee meets with the general manager and reviews all materials. Specific goals are discussed and agreed upon.
9. Prepare final agreements and documentation of the evaluation results for reporting to the board and including in the manager's file.
10. Note improvements to the form or process for future years.
All directors must be involved in the evaluation process, and the entire board must agree on the final overall comments and rankings communicated to the manager. Finally, the outcome of the evaluation process must be clear and easy for all directors and the manager to summarize in several key points.
And, where do evaluations lead? In every co-op surveyed, the manager evaluation process concludes with a discussion of and adjustments to the manager's compensation. All managers surveyed were satisfied that a review of their performance was linked to a reassessment of their remuneration. Some boards have found it helpful when managers take the initiative to research and propose a compensation package that is based on achievement of the goals set through the evaluation process.
The experience of Sally, general manager of a nearby co-op, was radically different from Tim's. Before meeting with two board members to discuss the evaluation results, she already knew what to expect. She had discussed the process to be used with the board a few months ago. She had completed a self-evaluation. She had received a summary of key points in advance of the meeting, giving her a chance to consider the suggestions the board had for her and to prepare her thoughts where she disagreed. She wasn't apprehensive because she knew which of last year's goals she'd been able to accomplish and was well aware what on-going concerns the board had about the co-op's operations. And, the results of a survey of employee opinions about the co-op workplace and Sally's overall management had been reported to the board and management a few months ago.
Sally and the two board members were surprised at how similar the goals proposed by the board were to the ones Sally drafted for herself. After agreeing on four major goals, the three of them reviewed a compensation proposal that Sally had drafted after earlier discussions with the board. She proposed a relatively low base salary with a bonus based on achievement of next year's goals. The three met for two hours and left feeling enthusiastic about the next year as well as the report and proposals they would take back to the board.
A co-op board of directors has a critical role as the collective supervisor of the general manager. In the words of one co-op manager, "The board must understand the responsibility they have to help me do a better job, just like the responsibility I have to all co-op employees." This supervisory role is one that includes regular, constructive feedback as well as formal, professional annual evaluations. Boards owe it to general managers they want to retain and encourage to critically review the steps, forms and procedures that they use for annual performance appraisals -- and to get help when they need it to ensure that the manager's evaluation process reflects the way the board would want the co-op to treat each and every employee.