Dissertation

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A critical analysis of the Performance Review
Process in the Banking Sector in U.A.E.
Samia Said Shahzada
MISIS: M00444817
HRM4030
Dissertation submitted in partial fulfilment of the requirements for the MAHRM
Middlesex University Business School
October 2014

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Statement of Originality
Except for those parts in which it is explicitly stated to the contrary, this work is my own.
It has not been previously submitted for assessment at this or any other institution.
Please check the following statements are true, tick the appropriate box and sign the
declaration.
Statement Yes No
1. I have included a full reference list using Harvard style
referencing.
2. I have provided Harvard style references for all the ideas,
empirical evidence, and other materials I have used.
3. I have referenced all passages from my source material.
4. Wherever I have copied someone else’s’ words (a
quotation), I have clearly shown in the text how much
was copied by using speech marks.
5. I have not committed any falsification. This means I have
not presented invented data, by for example claiming that
I have conducted interviews or sent out questionnaires
when I have not, or altering or making up my results.
6. I can make available evidence of originality, including
notes, photocopies, drafts, primary data and computer
files.
7. I attach a CD-ROM with the electronic file of the
dissertation.
Student Name: Samia Said Shahzada. Date:
Student Signature:

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Acknowledgements
Dedicated to my Family
My sincere gratitude and respect to my supervisor, Keith Reynolds for all the support
and guidance he extended in the successful completion of this dissertation. His patience
and encouragement helped tremendously during trying times.
I would like to acknowledge the Banks in the U.A.E that participated, and offer my
appreciation to all the respondents who took time out to complete the surveys. Their
feedback proved invaluable in aiding my research.
Last but not least, my deepest and heartfelt thanks to all my family members and
friends. Without their unconditional love and faith, this process would not have gone as
smoothly. My husband, in particular, deserves a special mention, for being my strongest
supporter and mentor. His help and encouragement were a source of tremendous
comfort during challenging moments. As for my children, I feel an incredible amount of
gratitude and admiration for the maturity and understanding they displayed, particularly
in times where my personal involvement was insufficient.
Finally, a big thanks to Middlesex University Dubai for providing me with the opportunity
and resources to ‘master’ my Masters!

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Table of Contents
STATEMENT OF ORIGINALITY..........................................................................................................................................2
ACKNOWLEDGEMENTS.........................................................................................................................................................3
EXECUTIVE SUMMARY..........................................................................................................................................................6
1. INTRODUCTION..................................................................................................................................................................7
1.1.1. BACKGROUND OF THE COMPANY. 8
1.1.2 HISTORY OF THE COMPANY. 9
1.1.3. CURRENT SCENARIO. 9
1.2. PROBLEM STATEMENT. 10
1.3 RESEARCH OBJECTIVES. 10
1.4. SCOPE OF RESEARCH. 10
1.5. RESEARCH DESIGN. 11
1.6. CONCLUSION. 12
2. LITERATURE REVIEW...................................................................................................................................................13
2.1. PERFORMANCE MANAGEMENT-AN OVERVIEW: 13
2.2. THE PERFORMANCE REVIEW PROCESS. 13
2.3. THE ROOTS OF ANXIETY. 14
2.4. IF IT’S FLAWED, THEN WHYTHE POPULARITY? 15
2.5. PERFORMANCE REVIEW-A CURSE? 17
2.6. OR A BLESSING IN DISGUISE? 20
2.7. ESSENTIAL THEMES WITHIN THE PERFORMANCE REVIEW PROCESS. 21
2.8. WHAT’S IN A ROLE? 22
2.9. PERFORMANCE REVIEW- A DIALOGUE OR MONOLOGUE? 24
2.10. OBJECTIVES THAT ARE ‘SMART’. 26
2.11. RATING / RANKING ERROR ALERT. 28
2.12. THE MANY FACETS OF REWARD. 30
2.13. PERFORMANCE REVIEWS IN A CHANGING WORLD. 32
2.14. CONCLUSION. 33
3. RESEARCHMETHODOLOGY.......................................................................................................................................34
3.1. AIMS AND OBJECTIVES: 34
3.2. RESEARCH DESIGN. 34
3.3. METHOD OF ANALYSIS. 35
3.4. METHOD OF DATA COLLECTION. 37
3.4.1. SAMPLING METHOD: 37
3.4.2. ADMINISTERING A SURVEY: 38
3.5. QUANTITATIVE DATA- INDICATORS, RELIABILITY, AND VALIDITY. 39
3.5.1. INDICATORS. 39
3.5.2. RELIABILITY. 40
3.5.3. VALIDITY. 40
3.6. CONCLUSION. 40
4. FINDINGS AND DISCUSSION.......................................................................................................................................42
4.1. DATA ANALYSIS- ABRIEF OVERVIEW. 42
4.2. APPROACH TO DATA ANALYSIS. 45
4.2.1. THEME 1. REALISTIC GOALS. 46
4.2.2. THEME 2. BALANCE BETWEEN THE KPI’S/ COMPETENCIES. 47

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4.2.3. THEME 3.EMPLOYEE PARTICIPATION. 48
4.2.4. THEME 4.EMPLOYEE GROWTH/REWARD. 49
4.2.5. THEME 5. FAIRNESS/TRANSPARENCY. 51
4.2.6. THEME 6. ROLE OF HR. 52
4.3. CONCLUSION. 53
5. CONCLUSION.......................................................................................................................................................................55
5.1. RECOMMENDATIONS. 56
5.1.1. REALISTIC GOALS. 56
5.1.2. COMMUNICATION. 57
5.1.3. REWARD/ MOTIVATION. 58
5.1.4. FAIRNESS/TRANSPARENCY. 59
5.1.5. ROLE OF HR. 59
5.1.6. CHANGE MANAGEMENT. 61
6. LEARNING REVIEW.........................................................................................................................................................62
7. REFERENCE LIST.............................................................................................................................................................65
8. APPENDIX...........................................................................................................................................................................68
8.1. RESEARCH ETHICS APPROVAL FORMS 75
8.2. SUPERVISOR CONTACT SHEET. 77
(Total No Of Words: 16,460)

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Executive Summary.
This research involves a critical analysis of the role of the performance review process
in the Banking Industry in U.A.E. The research highlights the perspectives of both,
appraiser and appraisee, with regards to their performance review process in order to
compare theory against practice.
Following the introduction, the second part of the research consists of in-depth views
set forth by critics and advocators of the performance review process. The critical
analysis scrutinizing the two contrasting perspectives written in theory forms the main
theme around which the research has been conducted, in order to reach a better
understanding of how effective (or not) the performance review process can be in
reality.
The third part of the research focuses on the proposed strategy for conducting the
research. This has been undertaken via surveying 5 Banks. By using a cross-sectional
research design, the respondents have answered to several closed ended statements
concerning relevant themes within the performance review process. For the purpose of
reliability and validity, a Thurston Scale design has been used for the survey, where
participants have responded against multiple indicators. Notwithstanding the minority
who disagreed, the main findings from the survey in the fourth part of this research
revealed that the Banking Sector is, evidently, following a ‘best practice’ approach as
suggested in theory, and in contrast to the views of the critics cited in the literature
review regarding the overall performance review process.
Finally, the last part consists of recommendations provided for the improvement and
sustainability of an effective performance review process. It has been suggested that
managers and team members within the Banking Industry work collectively on a
continuing basis throughout the year focusing on realistic goals, providing adequate
communication and feedback, ensuring employee participation in the process and
justifying a fair and transparent process with the involvement of HR.

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1. Introduction.
The performance review has been described as the “third deadly disease of
management” (Deming 1986 cited in Armstrong, 2009, p. 45).
“Performance management systems almost universally work poorly and are negatively
viewed by both managers and managed.”(Farnham 2004 cited in Armstrong, 2009, pg.
46). A further declaration on the performance management systems was that “rarely in
the history of business can such a system have promised so much and delivered so
little.”(Grint 1993 cited in Armstrong, 2009, pg. 47). In spite of such a critical and ‘dark’
view of the performance review system, it is very much in use and here to stay.
In fact, it has been agreed largely that it “should not be abandoned”. (Grint 1993 cited in
Armstrong, 2009, pg. 47). According to research conducted by Armstrong and Baron in
1998, it was “revealed that most people approved of the performance review and
personal development aspects of performance management and carried it out
conscientiously”. (Armstrong, 2009, pg. 42). Edward E. Lawler III, after surveying 100
corporations in the US, put forth his views: “the bottom line is that every company
responded that they do have a performance management system, and only six per cent
said that they are considering getting rid of performance appraisals for some or all of
their employees. In short, the death of performance appraisals is not occurring and is
unlikely to occur.” Lawler feels that “companies will continue to do performance
appraisals despite their short-comings and despite the many criticisms of them that
appear in the management literature.” (Forbes, 2012, Performance Appraisals Are
Dead, Long Live Performance Management.)
The Performance Review falls under the umbrella of the performance management
system. It focuses on employee development and performance by way of measuring
objectives, competencies, and training. Individual learning is a critical component of an
organizations strategic direction. The performance review helps the organization with
where it is now and where it needs to be in the future. An effective performance review
system contains the following elements:

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 To link individual goals and objectives to the overall strategic direction of the
organization.
 To focus both on the objectives (the ‘what’) and the behaviours and competencies
(the ‘how’) in order to assess not only whether the individuals are meeting their
targets.
 To have a fully developed and understood administrative process that ensures that
performance reviews are conducted conscientiously, transparently, and on an on-
going basis.
 To have trained and qualified assessors who have the necessary skills and
training to successfully conduct the performance review process.
 A formal review forum where past and future performance is openly discussed and
supported.
 An effective system of quality control that ensures the performance review process
is carried out and maintained with integrity and in full confidentiality. (Walters,
2009).
The critics have given their bleak judgment on the failure of the performance review
process. However, it is critical to also analyse the flip side before giving the
performance review a harsh predicament. As Edward E. Lawler III aptly voiced, “Instead
of wasting time debating whether to eliminate performance appraisals, we should be
talking about how to make them more effective. The key is to make them part of a
complete performance management system, which includes goal-setting, development,
compensation actions, performance feedback and a goals-based appraisal of
performance.” (Forbes, 2012, Performance Appraisals Are Dead, Long Live
Performance Management.)
1.1.1. Background of the Company.
In light of the contrasting views regarding the performance review system, this research
will compare and analyse the methods used in the Banking Industry in the UAE. The
research will narrowly focus on the Investment/Corporate side of the banking sector,
where the perspectives of both appraiser and appraisee will be taken into account for a
thorough and critical analysis.

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1.1.2 History of the Company.
The UAE hosts a variety of local and international banks, both in the public and private
sector. There are 55 banks in this region, some of which have been in operation for
more than 20 years, with the addition of a few having started their practice recently. Out
of the 55 banks in UAE, 22 are local banks while 33 are branches or subsidiaries of
International banks.
Out of the 55 banks in UAE, 36 banks have Investment/Corporate banking operations.
This research will conduct surveys on 5 sample banks from the UAE market. Each of
the sample banks has been operating in the UAE for the last 20 years. They all have
well defined Corporate/Investment business groups across UAE ranging from 6 to 60
with a total number of 1000 to 3000 employees in each bank. The Corporate/Investment
group individually have a staff of 150 to 300 employees who will form a part of this
research.
1.1.3. Current Scenario.
All organizations follow their own set of procedures for conducting the performance
review process. The purpose of this research is to focus on a number of banks in the
financial sector in UAE, by critically analysing and comparing the various approaches
used for appraising performance. This will be conducted via obtaining feedback from the
employees through surveys in the Investment/Corporate side of the banking industry.
The targeted group of employees will comprise of mid-management level. By gaining
insight from both the appraiser and appraisees perspective, the research will highlight
what is considered to be an effective approach to the performance review system in the
targeted organizations, while also bearing in mind the potential for poor practice and
non-achievable goals.

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1.2. Problem Statement.
To what extent do the employees and management within the Banking Industry find the
Performance Review process to be an effective tool for achieving objectives?
1.3 Research Objectives.
In view of the problem statement, the objective of the research will cover the following:
 To reach an understanding that will cover the gap between rhetoric and reality.
Does the Performance Review actually aid towards the growth and increased
performance of employees?
 The level of employee participation in the setting of and agreeing to achievable
targets.
 The involvement of HR in the performance review process.
 Finding a clear line of balance between the financial targets/KPI’s and the relevant
competencies that ensure an effective and fair performance review process.
 Gauging employee satisfaction regarding the rating/ranking criteria that are a part
of the performance review process.
 The level of employee motivation and development as a consideration in the
implementation of an effective performance review system.
 Determining manager capability in assessing and conducting the Performance
Review Process.
 Is the Performance Review a fair and transparent process?
1.4. Scope of Research.
The research will focus on the banking industry in the UAE, specifically the
Investment/Corporate divisions. For the purpose of this dissertation, the involved Banks
wish to remain anonymous. Therefore, they will be referred to as Bank A, Bank B, Bank
C and so on.

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The selected group from within this industry will encompass 5 banks out of the 36 that
follow a well-defined Investment/Corporate banking practice in the region. The research
will focus on mid-level management, from the assistant manager going up to vice-
president level. This particular group of employees in the chosen banks will be surveyed
upon regarding the performance review process within their organizations. The criteria
of the research will involve reaching an understanding of how mid-level management in
the Investment/Corporate side of the banking industry feel about the challenges
mentioned in the problem statement above.
1.5. Research Design.
Chapter 2 provides emphasis on the literature review, where the area of performance
management is critically analysed by studying and comprehending views of various
academics in this field. The primary focus being on the performance review process in
organizations where the contrasting views of academics are studied to interpret how the
process differs in academic theory compared to how it actually works in reality.
Chapter 3 deals with the research methodology and the manner in which the related
topic is compared and analysed through surveys in the chosen organizations. The
objective is to gather feedback through surveys from both the appraiser and the
appraisee concerning the review system in their organizations and comparing it with
‘best practice’ in theory.
Chapter 4 lays emphasis on findings from primary data and comparing with the
discussions in the literature review regarding an effective and balanced performance
review process in organizations. In this way the evidence gathered from the surveys will
allow a broader understanding of the similarities and differences found in the process,
as stated in theory and how it is practiced in reality.
Chapter 5 includes a critical discussion on the performance review process that is
recommended in theory and analysed against evidence-based research. The process is
a key area in identifying and managing employee performance and development that
leads to organizational success. In this light, and based on results from factual data,
organizations should ensure that organizational goals are vertically and horizontally
integrated to the strategic direction of the organization and where employee
performance and development is actually enhanced to its full potential.

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Chapter 6 is a narrative of the discoveries made in the researching of ‘best practice’ in
organizations pertaining to the performance review process. This journey is a reflection
of the reality that prevails in practice in comparison to the academic theory, where work
ethics and certain attitudes and behaviours are expected to be prevalent, but where
reality proves otherwise.
1.6. Conclusion.
The performance review process is one of the key tools used in managing the
performance and development of employees in the financial sector. It is critical that
senior management understand the importance of employee involvement in the setting
of goals and targets that need to be aligned with the corporate goals. In addition to this,
manager capability and training is of equal importance especially when they are
responsible for assessing the performance of an individual. A joint agreement between
the managers and the employees in the setting of goals and competencies will produce
the desired results. Successfully managing and maintaining a performance review
process to its full potential will also benefit both parties to use the process as a stepping
stone for future growth.

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2. Literature Review
2.1. Performance Management- An Overview:
Performance management has been defined as “the development of individuals with
competence and commitment, working towards the achievement of shared meaningful
objectives within an organization that supports and encourages their
achievement.”(Henry et al cited in Baron and Armstrong, 2005, pg. 2). Performance
management also includes “directing and supporting employees to work as effectively
and efficiently as possible in line with the needs of the organization.” (Walters cited in
Baron and Armstrong, 2005, pg.2).
Performance management as a system has to be strategic to the organizations short
and long-term goals and integrated with various aspects of business, people
management, individuals, and teams. Original- From Performance appraisal, (CIPD)
website, May (2013).
According to Armstrong and Baron, performance management “establishes shared
understanding about what is to be achieved and an approach to leading and developing
people which will ensure that it is achieved. It is a strategy, which relates to every
activity of the organization set in the context of its human resource policies, culture, and
style and communication systems. The nature of the strategy depends on the
organizational context and can vary from organization to organization.” Original- From
Performance management: an overview, (CIPD) website, May (2013).
2.2. The Performance Review Process.
The performance review is known to be “the central pillar of performance management.”
Original- From Performance Appraisal, (CIPD) website, May (2013).
The performance review meeting lies at the heart of the performance review process.
The meeting is usually held annually or twice a year depending on the set up of the
organization. It starts with a formal meeting and can be carried out as a continuance

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process throughout the year. It is during the formal meeting that the goals and targets
and the relevant competencies are discussed and communicated to the employee.
Once the employee has been made aware, and has understood the requirements of
what is needed from him/her, it is the job of the manager to follow up and offer any
support or guidance for future improvement. The process requires considerable skill and
sensitivity on the part of the manager who is appraising the employee. The way in which
a manager handles a performance review meeting can play a crucial role in motivating
or de-motivating an employee. Thereafter frequent monitoring on an informal basis aids
in the success of the initial meeting and of employee performance in achieving his/her
goals effectively.
However, in reality, this ‘ideal’ and ‘simplistic’ practice rarely exists. Research
conducted in this field by various commentators reveals another story. Moreover, it is
essential to go back into history and study how the phenomena originated and became
a topic of scepticism.
2.3. The Roots of Anxiety.
In their book titled ‘Fearless Performance Reviews’, authors Jeffrey and Linda Russell
give a brief history of the origin of the performance reviews, indicating that the roots lie
in the early 1900s and were mainly the work of Fredrick Taylor. His work focused on
scientific management, which included the division of responsibilities between
managers (thinkers) and employees (doers). By using a structured and systematic
process, Taylor believed that workers didn’t have the knowledge to effectively decide
how to do their work and it was up to management to develop detail plans for defining a
job and deciding how a job was to be done. Once management defined these, job
expectations and methods were then to be communicated to the workers. In spite of a
rather top down approach, they also believe there is no doubt that Taylor had a
profound impact on how organizations structured themselves and operated in the early
twentieth century. His methods played an especially significant role in World War II in
how industrial organizations managed their operations and workforce. It was during this
period that the traditional performance review was born as a managerial vehicle for
defining performance expectations and for holding workers accountable to these

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expectations. However, this style of management clearly negates a relevant ‘fit’ in the
current century as expressed clearly by the authors in their words: “So the process
review legacy that we inherit today is steeped in an early twentieth century, top-down,
one-way, manager-knows-best tradition, that unfortunately, is not a good fit to our
twenty-first century sensibilities that involve an awareness of the importance of
employee engagement, the power of employee job ownership, and the value of
employee participation in designing and managing their own work.” (Russel, 2014, p.
xiv)
The same thought regarding Taylor’s scientific management approach has been
criticised by Jeremy Hope and Steve Player, authors of ‘ Beyond Performance
Management’, where they have also asserted a major flaw in the traditional
performance appraisal. They further state that the system is incongruent with the
values-based, devolved, and participative work environments many leading
organizations favour. According to Fredrick Taylor’s scientific management theory in
which he said, “each employee should receive every day clear-cut definite instructions
as to just what he is to do and how he is to do it, and these instructions should be
exactly carried out, whether they are right or wrong” (Hope and Player, 2012, p. 341) is
completely in line with why people dislike performance appraisals and think they are
fundamentally flawed, yet they are ingrained management processes in most
organizations.
2.4. If it’s flawed, then why the popularity?
Criticism regarding the performance review system has arisen mostly due to a reflection
of the Management By Objectives from the post World War II era or the traditional
appraisal that it eventually progressed into. However, the process of managing and
guiding people has come a long way since. What used to be known as the traditional
appraisal has transformed into a much broader picture that has evolved over time with
performance review falling under the umbrella of what is called Performance
Management. The terms ‘performance management’ and ‘performance appraisal’ are
sometimes used synonymously, but they are different. “Performance management is a
comprehensive, continuous and flexible approach to the management of organizations,

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teams and individuals which involves the maximum amount of dialogue between those
concerned. Performance appraisal is a more limited approach which involves managers
making top-down assessments and rating the performance of their subordinates at an
annual performance appraisal meeting.” (Armstrong and Baron, 2005, p.14)
Performance management is not only about what is achieved but also about how it is
achieved. In his book titled ‘Armstrong’s Handbook of Performance Management’,
Michael Armstrong states that while management is responsible for directing,
measuring, and controlling employee performance, it is not their sole duty. He stresses
the equal importance of both individuals and teams joint participation and involvement
as stakeholders in the process. It involves employee development and he suggests that
performance improvement will not be achieved unless there is an effective process of
continuous development. This involves the core competencies of the organization and
the capabilities of individuals and teams. He further proposes that performance
management is more specifically concerned with aligning individual objectives to
organizational objectives and encouraging individuals to uphold the core values of the
organization. In other words, what people are expected to do, concerned with skills and
the behaviours that people have to exhibit in order to perform at the highest level.
Connecting this with providing opportunities for individuals to identify their own goals
and develop their skills and competencies by motivating them through recognition and
reward. This recognition of employee achievement and growth links performance
management as part of the total reward system as well.
In a nutshell, “performance management is essentially a developmental process that
aims to improve the performance and potential of people through their own efforts and
with the help of their managers and the organization.” (Armstrong, 2009, p. 56)
“Performance management is all about continuous improvement” and “operates as a
continuous and self-renewing cycle.” (Armstrong, 2009, p. 62)
(Illustrated in the diagram below)

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Armstrong’s views regarding the process of performance management and particularly
of the role of the performance review that falls under this category, not only justifies a
logical approach as to how the system should work but it also takes away the
bureaucratic focus of the traditional appraisal schemes that are prevalent in many
organizations even today and are a reason of much scrutiny among the many critics of
this exercise.
2.5. Performance Review- A Curse?
In spite of the wide use of the performance review system in organizations, studies
amongst various academic commentators have revealed much scepticism circling this
phenomenon. Carlton and Sloman’s (1992) observation on the appraisal system of an
Investment bank revealed that managers were hostile to what they perceived as
bureaucracy and disliked form filling. Ratings linked to pay were disliked and as one line
manager reported: “Performance appraisal is a load of rubbish. You decide on the rating
you want to put in the box and then make up a few words of narrative in other sections
to justify it.” The academics also felt a tendency towards a drift in ratings. They reported
that managers tended to over-rate people because of the link between appraisal and
pay. As one manager commented: “I knew that his performance did not justify the rating
but I thought it would demotivate him if I marked him down.” (Cited in Armstrong, 2009,
p. 44). Victor Lipman, Corporate Manager at MassMutual Financial Group, discovered

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“in a forced ranking system, managers and employees have no place to hide. It literally
forces performance issues to be addressed.” He added: “while the system was intended
to help promote closer linkage between job performance and bonus pay-outs-a worthy
objective-it often felt like the curse was worse than the disease.” (Lipman, 2012.)
Crosby (1995) further added his critique to the performance review system calling it a
‘one-way street regardless of the format design’. He also added that since there are no
certificates to prove the qualifications of the reviewer, the reviews, which are supposed
to give information to management about employees, do the reverse! (Cited in
Armstrong, 2009, p. 45)
Farnham (2004) and Grint (1993) added their observations regarding the performance
review system in organizations as being universally poor and negatively viewed by both
managers and managed. Their conclusion: “Rarely in the history of business can such a
system have promised so much and delivered so little.” (Cited in Armstrong, 2009, p.
47)
Research conducted by Pulakos, Mueller-Hanson and O’Leary (2008) in the United
States revealed that one of the main problems with performance review is that
“managers and employees are reluctant to engage in candid performance discussions.”
(Cited in Armstrong, 2009, p.48)
A survey of three companies carried out by Stiles et al (1997) revealed a considerable
degree of managerial apathy and even scepticism about carrying out the performance
review. Some of the main reasons involved the perceived bureaucracy of the appraisal
system that diverted managers from their ‘real job’. In addition, there was a lack of
positive outcome in terms of both development and pay. The approach was a defensive
use of appraisal that lumped everyone together in average or even high/low categories.
Change was driven in a top-down systematic manner with the absence of consultation
that lead to cynicism and lack of trust among employees. Employees expressed
concern over the fairness and accuracy of the performance review process. Moreover, it
was felt there was little or no negotiation in objective setting with question marks over
the achievability of the targets. Employees felt there were more emphasis on the link to
pay and little concern about development. Lack of procedural justice did little to restore

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the employee’s trust and their involvement in determining decisions about change,
giving input during objective setting and performance evaluations. (Cited in Armstrong,
2009, p. 49)
Further research in this field led by Dr Tim Baker after interviewing 1200 managers and
HR professionals across all industries over the years identified negative views regarding
the use of the performance review system. Some of the common themes revealed the
following:
Appraisals are a costly exercise. They can be stressful and destructive with a tendency
to be a monologue rather than a dialogue. The formality of the performance meeting
stifles discussion. They are merely a form-filling exercise carried out infrequently and
rarely followed up. (Baker, 2013, p.11)
Samuel A. Culbert, author of ‘Get Rid Of The Performance Review!’ adds blame for the
failure of the performance review system on: “A management theory that has pretty
much passed, but whose legacy-the performance review has had much greater staying
power.” (Culbert, 2010, p. 16). In his opinion, the management theory as referred by him
is the Management By Objectives dating back to the post World War II era. It bears
similarity to Fredrick Taylor’s scientific management theory mentioned previously, that
allows a manager to establish a set of department goals and then focus on what
individual employees need to accomplish to meet those goals. According to Culbert, the
MBO encouraged ‘arm’s-length management’, where the manager did not have to
watch what their reports were doing every second. “Managers could skip daily
involvement in their subordinates’ work lives; they had a system that held subordinates
accountable for keeping commitments, making their numbers, and producing tangible
results. With their distance secured, they could stand back and avoid the fallout.”
(Culbert, 2010, p. 17) As a result, the employees had no incentive to perform better, just
as long as they were able to achieve the given targets. As a result, the management by
objectives system failed in instilling an internalized commitment to the company.
In light of the ‘dark view’ highlighted by various commentators regarding the
performance review system, the predicament of the banking industry seems
unfavourable, given their choice of the use of this tool. There is little doubt that
performance management is both difficult and demanding. It is also not an easy option.

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The consequences of poorly designed and administered performance management
schemes, or ones that lack management commitment can result in poor motivation and
self-esteem on the part of the employees. It can result in loss of focus and commitment
between supervisors and employees. (Armstrong, 2009, p. 75) And “a deep
undercurrent of resentment among lots of employees out there.”(Lawler, E. 2012)
However, performance review system does have many benefits, provided it is carried
out the way it is intended to be. As Lawler, Mohrman and Resnick (1984) believe,
“performance management must focus on the process of performance review and on
the organizational context in which the event takes place, not on the form or system.
Too often, the system comes first and the process is neglected.” (Cited in Armstrong,
2009, p. 75). As Lawler aptly states “performance reviews might not ever be fun, but
they can be effective and powerful ways of creating more loyalty among team members
when they’re done right.” (Lawler, E. 2012)
2.6. Or a blessing in disguise?
It is essential to initially focus on performance management as part of a broader picture
in order to achieve the right perspective before proceeding to the actual process of the
performance review. Because if the former isn’t in place, there will be little hope of
achieving any success in the latter! An effective structure for performance management
in organizations is based on a clear line of sight between strategic aims of the
organization and those of its departments including staff at all levels. People know what
is expected of them because of an open dialogue and communication between
manager and employee, which leads to an understanding of the goals and
accountabilities. There is a strong fit between the job and the capabilities of the people.
The management defines what it requires in the shape of performance improvements,
goal setting for success and monitoring performance to ensure that the goals are
achieved. Performance management processes are aligned to business goals to ensure
that people are engaged in achieving agreed objectives and standards. The capacities
of people are developed through learning at all levels to support performance
improvement, and people are provided with opportunities to make full use of their skills
and abilities. This leads to focusing on promoting positive attitudes that result in an

21
engaged, committed, and motivated workforce. People are valued and rewarded
according to their contribution and there is a climate of trust and teamwork, aimed at
delivering a distinctive service to the customer. Finally, there is strong leadership and
support from the top between all stakeholders-line managers, team leaders, employees
and their representatives. (Armstrong, 2011, p. 164)
T.S.Eliot has captured the contrasting views regarding the failure and success circling
the performance review system very aptly, from his poem ‘Little Gidding’. “We shall not
cease from exploration, and the end of all our exploring will be to arrive where we stand.
And know the place for the first time.” (Cited in Russell, 2014, p. 189). It is only through
exploring that one learns what one knows not. Once the realization of new learning sets
in and new methods have been acquired, a revisit to the start falls in line with a new
understanding of knowledge that separates right from wrong. The same analogy applies
to a better and more productive performance review process that can actually work in
organizations if carried out in the right way. It is therefore imperative that organizations,
managers and employees make a rapid transition away from the inherited approach to
performance management, and the reviews that are a part of this approach, towards a
more appropriate model that embraces employee ownership of the process with
individual and organizational learning at the core. Not doing so will throw the people
back into the ‘Tayloresque’ world where the manager is ‘all-knowing’ and where the
employees are at a risk for losing their creative energy, commitment and development,
the core strengths that are so critical to their performance. (Russell, 2014, p. xv)
2.7. Essential themes within the Performance Review Process.
A performance review is not a separate activity taking place at an annual or twice-yearly
meeting; it is, or should be, a continuous process so that the methods used in a formal
review meeting are also used in informal reviews throughout the year. (Armstrong and
Baron, 2005, p. 23) The performance review meeting begins with a specific job
description that is in line with the employee’s capabilities, followed by a dialogue
between the manager and employee regarding the setting and achievement of goals
and objectives. Once these have been agreed upon, the cycle of continuous feedback
begins, where the manager’s duty is to offer guidance and assistance along the way. At

22
the time of a formal review when both parties sit down to discuss what has been
achieved, or not, as the case may be, the manager and employee jointly take steps that
will ensure that the latter is on the right track. These steps could be in the form of a
personal development plan for the employee should he/she require assistance in
achieving the set goals.
2.8. What’s in a role?
“People are often confused about their organizational role. On the one hand they are
expected to follow standard operating procedures, but on the other hand they are
supposed to be enterprising-always striving to improve existing processes and
considering different ways of doing things.” (Baker, 2013, p. 192). Research conducted
by two different authors on the same topic provides an interesting insight into the role
profile. Authors Jeffrey and Linda Russell (2014) assert that a critical step in defining
performance for a position is the articulation and integration of specific performance
outcomes within the position or job description. The position description is responsible
for defining everything that is expected of an employee and therefore needs to be
clearly spelt out. They explain if an employee is to be held accountable for achieving
performance, then the position description needs to reflect these expectations. Their
argument however is that position descriptions too often focus on describing behaviours
and activities or offer general outcome statements about the role and function of a
position. They believe that while these are of relevance, they are not by themselves
sufficient in providing performers the clear and compelling performance outcome
direction that employees need. (Russell, 2014, p. 118)
Dr Tim Baker takes the same point further by putting emphasis on the ‘role’ rather than
the ‘job’. He begins by defining role analysis “as the process of collecting, analysing,
and recording information about the requirements of roles in order to provide the basis
for a role description.” (Baker, 2013, p. 99) Thereafter he emphasises the strong
tendency to confine performance discussions to the job description, which, in his view is
a mistake. He asserts that the starting point in understanding performance should be to
think about the roles employees are expected to play in organizations rather than the
job they have. He clarifies further by separately defining the two. “A job is a clearly

23
defined set of tasks that have some inter-relationship; an employee is expected to carry
out these tasks competently.” While “ a role is a broader concept than a job. It
encompasses job and non-job functions.” (Baker, 2013, p. 71). He argues that in terms
of performance, most organizations are more concerned with the job an employee does
than with the role they play within an organization. He justifies his point by providing an
example where given this situation; the employee can very well say to the manager “if
it’s not in my JD, I’m not required to do it”. In his opinion, employee performance in the
modern work setting cannot be completely captured in a JD because the work
employees do is two-dimensional. In other words, they have job and non-job
requirements. Non-job performance being the role the person is expected to play within
the work environment (Teamwork, leadership, accountability, collaboration,
communication, self-development, technical development, problem solving and critical
thinking). These non-job roles are usually not mentioned directly in the conventional JD,
despite being considered critical to overall performance. Bacal (2004) made a similar
analysis regarding the job description. He asserts, “Many managers rely on paper job
descriptions in performance reviews. Don’t. Job descriptions are rarely accurate and
updated regularly enough. Also, remember that you’re viewing employee performance
in the real world. You don’t review or appraise a job description. Start from what the
employee really does.” (Bacal, 2004, p. 109).
It is interesting to note the contrasting views of the authors, where the former has
placed these non-job requirements as insufficient in guiding employees with a clear
performance outcome direction. Baker insists that performance ought to be considered
in both dimensions and this would require a breakdown of the various tasks the person
is expected to perform in that particular job. (Baker, 2013, p. 72)
Armstrong’s addition on the role profile interestingly combines with the views of Russell,
Baker, and Bacal, with the exception of core values, which the other three authors have
failed to mention while outlining the requirements in their role profiles. Armstrong is of
the opinion that role profiles define a role in terms of the key results expected, what role
holders are expected to know and be able to do, and how they are expected to behave
in terms of behavioural competencies and upholding the organization’s core values.
(Armstrong, 2009, p. 65). A valid point, which both Russell and Baker failed to mention,
is the need for the role profile to be frequently updated every time a performance review

24
agreement is developed and provide headings under which goals can be set. He further
asserts, “It is probably best to abandon any existing job descriptions. They may well be
out of date and probably go into far too much detail about what is to be done rather than
focusing on what has to be achieved.” (Armstrong, 2009, p. 65)
The views set forth by Russell, Baker, Bacal and Armstrong provides a relevant outline
to the way the performance review system should be approached. All four authors have
shed light on the importance of the role profile and the required behaviours and
competencies that are a part of the performance review system. Following this
approach is the task of setting objectives that will be an outcome of measuring
performance. Moreover, this requires clear and concise communication between
manager and employee. The communication or the ‘dialogue’ as it should be
appropriately called is the most critical and controversial component of the performance
review process.
2.9. Performance review- a dialogue or monologue?
The performance review has been criticised and come under a lot of scrutiny by many
authors and commentators as being a one-way conversation rather than a dialogue.
Since communication is a vital part of this process, the aggressive views put forth by
commentators in favour of a dialogue between manager and employee is no surprise.
As Culbert asserted, “We need a dialogue, not a monologue. We have to replace the
one-side-accountable, boss-administered/subordinate-received performance review
with a two-sided, reciprocally accountable performance review.” (Culbert, 2010, p. 146)
In his opinion, there is no variable in the discussion. It’s all about what the boss thinks
and nothing else matters. The lack of dialogue between the boss and the subordinate
invariably ends up placing the boss in a situation where he knows everything and
whatever he says about the subordinate is right. Almost making it seem as if the
subordinate is the sole cause of results, with the boss acting like the teacher who takes
no responsibility for the quality of the results achieved as long as the assignments are
clearly stated on paper. (Culbert, 2010, p. 158) Culbert’s harsh and radical views
provide relevant insight to a situation where there is a complete breakdown of
communication between manager and subordinate. However, his views are at one end

25
of the continuum and to provide a fair balance, views suggested by other authors need
to be taken into account in order to reach a fair understanding of the communication
between manager and employee. According to Bacal (2004) dialogue is “talking with
each employee rather than talking at them” (Bacal, 2004, p. 134) Armstrong (2010)
provides an extremely plausible suggestion by initiating the conversation through a brief
‘warm up’. The author also gives an interesting analogy where, in starting the discussion
“the supervisors may recall their own feelings about being evaluated. Empathy can spur
an approach, tone, and even boy language that makes the entire meeting less
adversarial.” (Armstrong, 2010, p. 36) The ‘warm up’ mentioned could be used to set a
comfortable tone prior to the meeting between the manager and employee. While it is a
professional meeting, small talk should be minimal, employees, and supervisors must
feel relaxed enough to become genuinely engaged, with the aim being to be open,
friendly, and positive. Moreover, the climate should be inviting and non-threatening, with
both supervisors and employees open to hearing concerns without being defensive.
(Armstrong, 2010, p. 37) Bacal adds his views on the importance of a warm up prior to
discussion, but clarifies that while “ small talk isn’t artificial, but a genuine way to begin
conversations and dialogue, it’s important that you keep the small talk brief.” (Bacal,
2004, p. 104) He emphasises his view regarding a ‘warm up’ by giving an appropriate
example relating to sports. “Think of it like warming up for a tennis match or a run. You
can’t go from a dead stop to full speed with your body, and you can’t do that mentally
either.” (Bacal, 2004, p. 104) further to the warm up, equally important is the process of
clarifying expectations for the meeting and clarifying the roles of both supervisor and
employee so that both are on the same wavelength. Bacall asserts that after the warm
up, the role of the latter is more critical. That is because part of the anxiety surrounding
performance reviews is that the employee doesn’t know what to expect. The two points
set forth by the author reiterate that one cannot be without the other. The warm up and
the process of clarifying expectations play a vital role in creating positive emotions from
the onset and in helping to clear any discomfort and anxiety that could result in blocked
emotions. (Bacal, 2010, p. 105)
Another valid step in achieving communication between manager and employee comes
in the form of active listening. Creating an environment that requires not just hearing but
“active listening” as stressed by (Armstrong, 2010, p. 89) On the supervisor’s part, it
requires a clear explanation of purpose, a willingness to establish trust, the openness to

26
invite the employee into the feedback process, and a genuine effort to understand what
the employee is saying. On the employee’s part, it takes much of the same, with
demonstrated willingness to become actively engaged, in owning the performance
review. (Armstrong, 2010, p. 90) The importance of employee involvement and
participation has been aptly reiterated by a famous Chinese proverb. “Tell me, I will
forget, Show me, I may remember, Involve me, I will understand.” (Cited in Armstrong,
2010, p. 89)
In line with the performance management process that moves in a continuous and an
on-going cycle, so should the communication or dialogue between manager and
employee. The effectiveness of the process lies in the continuity of on-going
communication. Bacal asserts by saying that although this is the simplest part of the
process and the easiest, it’s something a lot of managers skip, particularly if their own
workloads are heavy. This can make it difficult for managers to pay attention to on-going
communication. He cautions: “but if you ignore it you’ll pay a lot in terms of productivity
and even your time.” (Bacal, 2004, p. 133) He states one of the most important
purposes of on-going communication is to inform the manager of problems, either big or
small, before they become huge or impact significantly on productivity. Therefore, the
year-round communication process functions as a way of red flagging problems. It also
allows the manager to coach and develop employees on the job and help them to
perform better. Another important function is to avoid any surprises that may pop up at
review time. This ensures where the employee stands and how things are going. And
also makes the review process much easier and much less threatening and time-
consuming, which has been the concern of so many commentators regarding the
performance review process. (Bacal, 2004, p. 133)
2.10. Objectives that are ‘SMART’.
The joint process of writing and communicating objectives clarifies and directs
behaviour and provides employees with results-oriented challenges. Employee
involvement is critical as it provides them with share ownership and pride of outcome,
rather than feeling as if objectives are being imposed on them. Armstrong suggests, it’s
a good idea to build objectives around what employees most want to do. The author

27
justifies this by linking it to employee motivation. (Armstrong, 2010, p. 43, 44) It is
noteworthy to mention another reflection of the same point put forth by Baker (2013)
“What people enjoy doing is a reasonable indicator of their strengths. There is a saying
about the three Ps that goes like this: We practice what we prefer and therefore become
proficient at it.” (Baker, 2013, p. 120)
Objectives can be quantitative (numerical targets), achievement-bases (things to be
done), or qualitative (expectations of behaviour). They can also be work-related,
referring to the achievement of role requirements (results to be attained). Objectives can
be personal, taking form of developmental or learning objectives, which are concerned
with what individuals should do to enhance their knowledge, skills and potential to
improve their performance or change their behaviour in specified areas. (Armstrong and
Baron, 2005, p. 26)
How can organizations, particularly in the banking industry, where financial measures
take precedence over other more subjective outcomes, come up with objectives that
can benefit not only the organization but also provide motivation and developing
opportunities for it’s employees? The answer to that lies in making goals SMART.
‘SMART’ is an acronym for:
S = Specific- clear, understandable and challenging.
M= Measurable- quantity, quality, time, money.
A= Achievable- Challenging but within the limits of a persons capabilities and
commitment.
R= Relevant- relevant goals aligned to the objectives of the organization.
T= Time-framed- within a specific frame of time. (Baron and Armstrong, 2005 pg. 27).
The SMART acronym has been around for years as a framework for creating goals that
are more likely to be understood, actionable by others, and measurable by all parties.
(Russell, 2014, p. 177) The relevance of the SMART objectives has been equally
stressed by Sharon Armstrong (2010), where she asserts, “Objectives must be feasible
within given time frames, and include clear performance standards.” (Armstrong, 2010,
p. 44)

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Specific, significant, and stretching goals provide clarity and focus, achieving the goal
matters and the goal challenges the person to stretch in a new way. It is often said, “If
you can’t measure it, you can’t manage it.” (Armstrong and Baron, 2005, p. 29) The ‘A’
in the acronym ‘SMART’ stands for acceptance. When employees actively choose to
accept goals, they are much more likely to view them as their own and for this reason it
is essential to mutually agree upon goals rather than imposing them onto the
employees. Being realistic also matters because if the goal is too much of a stretch for
the employee or not anchored to a support system that enables the employee to
achieve the goal, there’s a good chance that the employee may fail at accomplishing
the desired results. Establishing time expectations and parameters is also a crucial
component of most effective goals. When a goal is timely, it is exactly what the
employee needs to be working on right now to best help the team or the organization
solve a problem, seize an opportunity, or achieve a larger goal. (Russell, 2014, p. 177,
178, 179, 180)
2.11. Rating / Ranking error alert.
There seems to be much criticism and scepticism revolving the evaluation criteria in
performance reviews that involves the use of ratings and rankings. Both employers and
employees alike have been cautioned to be aware of the errors that can affect
performance evaluations. Josh Bersin, (2013) aseerts, “coupled with the performance
rating is the ‘potential rating’, which tries to capture an individual’s potential to move up
two levels in the organization (the traditional definition).” Almost as if “this approach is
based on the philosophy that ‘we cant totally trust managers, so we’re going to force
them to fit people into these rating scales.” This is exactly why employees need to stay
vigilant and managers’ good intentions must be accompanied by the skill, understanding
and training required to reducing rating errors as much as possible. Even then,
Armstrong (2010) stresses its difficult. The author further argues, “Although software
can support some types of evaluations, performance appraisals are a human process-
conceived, developed, and administered by people. No evaluation comes with a flaw-
free guarantee.” (Armstrong, 2010, p. 77) Peter Drucker further confirmed that
performance cannot be measured fully: “As each human being is unique, we cannot

29
simply add them together, or subtract them from one another…To arrive at meaningful
measurements is one of the greatest challenges to management.” (Cited in Armstrong,
2010, p. 78) Regarding behaviours, Armstrong observes that goal-based systems are
often seen as the best current option for rating performance, but they must be used
carefully. The kinds of behaviours that are specified in the goal-setting process are
exactly what the employee will tend to focus on in his or her work, so its critical that
these are the behaviours the organizations wants to encourage. (Armstrong, 2010, p.
78) This observation fits in with the views of Michael Armstrong (2009) who laid stress
on organizational values as being a fundamental part of the role profile.
Evaluation problems in ratings errors can occur because of the perceptual differences in
definitions. When words such as poor, fair, adequate, satisfactory, and excellent are
used, the evaluation can be distorted. Other common errors in rating can arise due to
the halo and horns effect, sunflower effect, leniency and harshness, central tendency
error, sugar-coating error, recency of events error, contrast effect, critical incident effect,
personal bias, low motivation, past anchoring errors, sampling error, varying standard
error, holding employees accountable when it’s not their fault and attribution bias.
(Armstrong, 2010).
The ranking system does not seem to be flawless either. A ranking system is intended
to evaluate an employee by comparing him or her with all of the other employees in
similar positions within a company. The result is some indication of where the employee
lies, in percentage terms, relative to his or her peers. Depending on the form, “an
employee could be ranked as last in the company or first in the company or in terms of
percentiles, for example, a percentile of 55 means the employee is “better” than 55% of
his or her peers.” (Bacal, 2004, p. 62) Sometimes, in its worst form, a ranking system is
based on adding together the numbers from rating form items and giving an overall
performance number, which then serves as the basis for ranking the employee. The
comparison may also be made on the basis of an observable and quantifiable number,
such as sales per quarter or new clients signed up. Although this is, an area where
ranking can somewhat be justified. However, there are still a lot of problems associated
with the process. (Bacal, 2004) According to Josh Bersin, (2013) many companies
follow a forced distribution, “which mandate that some per cent of employees are rated
at the bottom and only a limited per cent can be rated at the top.” In such a scenario,

30
there is always a danger where “some companies really do have a lot of high
performers, so forced ranking eliminates great people and damages the culture.” Darvill
Croxford (2014) manager at Adobe, where they scrapped the performance review
process altogether, also justifies against the ‘stack ranking’ method, stating in their case
“it was prohibitive to innovation and was contributing to higher levels of attrition and
lower engagement scores.”
Bacal (2010) confirms Bersin’s point that by placing the employees in similar jobs in
direct competition with each other in the ranking system, for the sake of direct
competition with each other can actually prove detrimental to their motivation. He
asserts that the cutthroat competition instead of improving performance could very well
end up creating hostility among the employees and kills the concept of teamwork. In his
opinion “ranking employees is a poor idea.” (Bacal 2010, p. 62)
A remedial factor for lessening the errors in rating and ranking employees for evaluation
purposes boils down to training. According to E. D. Pulakos, “research shows that
training can minimize rating errors. When raters learned which data to focus on, how to
interpret it, and how to use it to formulate judgments, ratings were more reliable and
accurate than when there was no training incongruent with rating needs.” (Cited in
Armstrong, 2010, p. 84) Another suggestion is the involvement of senior management
including the HR department to ensure that the rating matches the narrative and that the
overall assessment is justified. The manager’s manager can also contribute the
objective insight and constructive feedback needed to make necessary changes. The
management review can therefore provide safeguards that are important to both the
supervisor and the organization. (Armstrong, 2010).
2.12. The many facets of reward.
Latham and Locke (1979) noted that: “Money is obviously the primary incentive” but
they went on to say that “money alone is not enough to motivate high performance.”
(Cited in Armstrong, 2010, p. 161) Money may be an important factor in attracting and
retaining employees. However, the effects of financial measures are likely to be short-
lived. Money has to be reinforced by non-financial measures, especially those that

31
provide intrinsic motivation and have a more powerful and longer-lasting effect on
people. These include recognition, achievement, responsibility, autonomy, influence,
and personal growth. Organizations therefore need to create the right blend of both
financial and non-financial as part of their total reward package. (Armstrong, 2010)
Out of all the intrinsic non-financial rewards mentioned above, feedback is probably the
most critical. It is also the most difficult task that managers face in operating
performance management processes. Some are good at it, many aren’t. (Armstrong,
2010) Feedback can be both constructive, when it is given timely and destructive when
it focuses on a personal level instead of the task. Negative feedback can demotivate
and destroy employee morale. Research by Gray (2001) identified two factors that
influenced the extent to which receivers valued their feedback: The extent to which the
feedback was trustworthy and the extent to which it was constructive. (Cited in
Armstrong, 2010, p. 108)
Baker (2013) stresses the importance of feedback by saying “ The goal is for a manager
to give at least three pieces of positive feedback for every one piece of negative
feedback. This helps the employee feel confidant that their manager’s view of their
performance is balanced and objective.” (Baker, 2013, p. 148)
Bowen (2000) reflects on smart managers who use performance feedback to recognize
rather than criticize. They express appreciation and evaluate employees on their
strengths and weaknesses. These managers are able to identify developmental
opportunities in their employees and take relevant actions to assist them in their
development. They also offer encouragement and probe for new areas of interest by
involving employees to participate and offer their views. Furthermore, they ask how they
can be better resources and look at ways to partner rather than preach. (Bowen, 2000,
p. 126) The author also suggests many other forms of reward that can help employees
to feel committed and engaged in their jobs. These include having a two-way
communication between the manager and employee, enhancing the self-worth of an
individual and increasing competence by recognizing intellectual capital in every shape,
size, and configuration imaginable. Formal and Informal recognition and celebrating
outcomes all can play a crucial role in rewarding employees and increasing their morale
to deliver higher levels of performance. (Bowen, 2000). As Eric Jackson (2012)

32
appropriately quoted regarding employee recognition, “Say thanks to your people when
they do a good job. It’s the cheapest bonus you’ll ever pay.”
2.13. Performance Reviews in a Changing World.
An organization in the financial sector reflecting on the purpose of Performance
Management believe the aim is to improve performance and to make it clear to people
how their performance links in with the performance of the business. (Armstrong, 2009)
Bacal (2004) both agree and mention the usefulness of performance reviews is
determined by how people understand the functions, the usefulness, and process of
reviewing performance and how they act on their different understandings. A critical
question to add to this would be “ Where do my company and I fit here?” (Bacal, 2004,
p. 5) In order to bridge the gap between rhetoric and reality, it is essential to understand
the importance of the performance review process in organizations. In spite of what the
critics have cited, performance reviews are very powerful tools that can contribute to
personal success, the success of the employee and work unit, and in turn, to the
success of the organization- provided they are done properly and the review process is
carried out with the goal of improving success for everyone involved. Performance
reviews have to be seen as an investment rather than a cost. In the event of the latter, it
loses all value. (Bacal, 2004). As Josh Bersin (2013) also asserts “businesses thrive on
agility, speed, passion, and alignment. The process of driving and measuring
performance has to do the same.”
The 21st century is experiencing an era in which old barriers fall and there is vast
reorganization of the production and distribution of knowledge and the symbols used to
communicate it. Changes in today’s work climate with flexitime, telecommuting, job-
sharing, improved training, and grouping employees by team make it feasible to
examine a fresh and fluid approach to managing people. In this regard, performance
reviews, too, need to adapt to change, especially with a workforce that is becoming both
older and younger, with particular focus on Generation ‘Y’ as they are called. Born
between 1979-1994, they are moving up fast and “entering the workforce in earnest,
with a lot of raw energy, unbridled enthusiasm, and the skills and experience of much
older workers. Gen Y’s live to be trained and absolutely thrive on recognition.”

33
(Armstrong, 2010, p. 110) Management therefore needs to reorganize and inject zest
into the business that is acquiring a ‘facelift’. In Charles Darwin’s words, “It’s not the
strongest or the smartest that survive, but the ones most adaptable to change” applies
critically in today’s changing world (Cited in Armstrong, 2010, p. 111)
2.14. Conclusion.
Adapting performance reviews, even developing, and implementing them effectively to
begin with, never occurs in a vacuum. The broader work climate has to embrace those
needs, and the will to do that has to begin at the top. This is where the role of leadership
comes into play. Once the CEO understands the value of holding managers
accountable for having on-going dialogues, it’s up to the managers to turn that business
philosophy into a sustainable performance management system. This will require
communication at all levels, training, monitoring, and assessment, all of which will aid in
shaping a positive performance review process. The support of leadership, therefore, is
crucial in taking performance reviews to the next level.
Finally, globalization is a critical factor that can present particular challenges for the
future. The U.A.E. hosts a large presence of both local and International Banks that
provide a mix of different cultures by way of hiring or importing local staff. As a result,
diversity is very much prevalent within the Banking Industry. The importance of
performance reviews therefore becomes even more vital under such circumstances.
However, in the absence of extensive research conducted on the topic within this
region, the contrasting views regarding performance reviews highlighted in the literature
review will be used as a yardstick against findings from primary data in order to evaluate
and conclude the effectiveness of the performance review process. Furthermore, the
extent to which the employees and management find the performance review process
effective will depend on essential themes such as reward for performance, employee
motivation and recognition and finally, organizational expectations that provide the basis
for a sustainable and flexible structure in a fluctuating world.

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3. Research Methodology
3.1. Aims and Objectives:
The main aim of this research is to do a comparative analysis of the performance review
process. The purpose is to cover the gap between rhetoric and reality, by identifying if
the performance review process in the Banking industry actually works towards the
growth and increased performance of employees, accentuating good practice as written
and talked about in theory.
As stated in the literature review, there is much scepticism revolving around the subject
of performance reviews in organizations. Many theorists quoted in the previous chapter
have criticized the performance review system for its lack of effectiveness, even going
onto say that the review process has not evolved much from the time Fredrick Taylor
developed this technique back in the early 1900s known as scientific management.
Critics fear “the process review legacy that we inherit today is steeped in an early
twentieth century, top-down, one-way, manager-knows-best tradition, that unfortunately,
is not a good fit to our twenty-first century sensibilities that involve an awareness of the
importance of employee engagement, the power of employee job ownership, and the
value of employee participation in designing and managing their own work.” (Russe l,
2014, p. xiv).
The purpose of this research is to use sample Banks in U.A.E by way of conducting
surveys in order to uncover reality by focusing on primary data. Thereafter, the results
from findings will be compared and analysed against secondary literature to evaluate
and conclude if the perspectives of the critics holds true in comparison to what the
advocators have put forth regarding their perspective of the performance review
process.
3.2. Research Design.

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There are two main ways of categorizing data in order to help meet the aims of the
research: Qualitative and Quantitative data. The research will be focusing on the latter.
Quantitative data, as the term suggests, is expressed in numbers. It comprises
measurements of variables, which by statistical analysis, can be organized, totalled,
averaged into meaningful information. The aim of this method provides the researcher
to look for relationships among the data and find ways in which one set of data can be
compared and evaluated with one another. The results of the analysis can then be used
to draw conclusions about the event being studied.
The proposed strategy for collecting data will be carried out using the cross-sectional
research design. “A cross-sectional design entails the collection of data at a single point
in time in order to collect a body of quantitative or quantifiable data in connection with
two or more variables, which are then examined to detect patterns of association.”
(Bryman and Bell, 2011, p. 53). Using this design, primary data will be gathered via
surveys. The purpose of a survey is to obtain standardised, quantifiable information
from a defined group of people, usually through use of a questionnaire. The data
obtained is then analysed, using statistical techniques, to test theory by comparing it
with empirical data.
In this case, the research will focus on individuals, mainly mid-management level
bankers, and groups comprising of the Corporate/ Investment banking departments.
The organizations concerned in the research involve 5 Banks within the United Arab
Emirates. In line with good practice and to avoid any misattribution, the level of analysis
and sampling involved in this research will focus on the above-mentioned criteria.
3.3. Method of Analysis.
In order to evaluate how far the performance review process differs and/or matches
theory, a sample of employees will be asked to respond to a series of statements. For
the purpose of this analysis, these statements will be based using the Thurstone scale.
Thurstone was one of the most productive scaling theorists. He invented 3 different

36
methods for developing a unidimensional scale: the method of equal-appearing
intervals; the method of successive intervals; and, the method of paired comparison.
The method of analysis in this research will be carried out using the “equal-appearing
interval” technique. In constructing the scale, the researcher selects a number of
statements, usually about 20, which cover all possible attitudes towards the topic of the
survey. The respondents then rate them according to their favourableness towards the
topic and place them along a scale, ranging from ‘strongly agree’ to ‘strongly disagree’.
In this way, each statement is equally placed along the scale. These statements are
then incorporated at random in a survey and respondents are asked to indicate their
degree of favourableness towards the attitude expressed. “The assumption is the
intervening stacks will represent equal steps along the attitude dimension.” (Original-
From Thurstone Scale website, 19th July 2014). Moreover, for this reason, the method
of using paper and pencil would be the most appropriate choice. Below is a sample of
the statement sheet using the Thurstone Scale.
It is assumed that respondents will only agree with statements, which are clustered
around their own position on the attitude scale, and will disagree with the more extreme
statements on either side. It is, therefore, essential to have both highly positive and

37
highly negative statements in the set. The data collected will be aggregated and
summarized by questions and rated according to the responses. In this way, the
analysis will draw conclusions from the level of agreement or disagreement. A sample
of this explanation is better described visually in the diagram below.
3.4. Method of Data Collection.
As previously mentioned, the method of data collection in this research will be
conducted via surveys. The data obtained will be analysed, using the Thurstone Scale
to produce information, which can be tested against hypothesis.
3.4.1. Sampling Method:
There are several types of sampling methods used as a technique for collecting data.
For the purpose of this research, the method of Stratified sampling will be used. In this
method, the population is divided into strata, such as social classes or occupational
groups, and a sample is randomly selected from within a particular strata. As a result,
this method allows the researcher to focus on a particular group, as is the case in this
research- a strategic focus on Corporate/Investment Bankers. Additionally, using this
method ensures “that employees are accurately represented in terms of their
departmental membership. The advantage of stratified sampling in a case like this clear:
“It ensures that the resulting sample will be distributed in the same way as the
population in terms of the stratifying criterion.” (Bryman and Bell, 2011, p. 181)
30%
40%
20%
10%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
S Agree Agree Disagree S Disagree
Statement

38
Furthermore, with reference to the validity of the sample size, out of the 55 Banks in the
U.A.E., 36 exercise Corporate/Investment operations with an employee base ranging
from 150 to 300 staff in the mentioned departments. For the purpose of data collection,
5 sample Banks out of the 36 have been chosen with department specifications. The
sample size therefore incorporates roughly 14% of the Banks that follow more or less
identical procedures in conducting performance reviews, hence allowing little room for
misinterpretation of data.
3.4.2. Administering a Survey:
A survey can be administered using several ways. Generally, if given to employees in
an organization, it might involve self-completion, as is the case in this research. Data is
normally collected in a survey by use of a questionnaire or a series of statements.
Respondents are required to read a series of statements, which are self explanatory in
nature, and therefore simple to answer. The designated strategy of this research is to
collect data using this technique. By making fewer and closed ended statements, the
data has an easy-to-follow design in order to minimize the risk that the respondents will
fail to follow filter statements or inadvertently omit one. Such a type of survey also has
the benefit of saving time, cost and “the risk of respondent fatigue, since it is manifestly
easier for a respondent who becomes tired of answering questions in a long
questionnaire to consign it to a waste paper bin.” (Bryman and Bell, 2011, p. 232) The
many advantages of making closed ended statements in a self-completion survey
allows ease to the respondent, as the main requirement is to circle the most appropriate
response. In addition, closed ended statements enhance the comparability of answers,
making it easier to show the relationship between variables and to make comparisons
between respondents or types of respondents. Closed statements also clarify the
meaning of a statement for the respondents in cases where the respondents are
unclear about what the researcher is looking for. Finally, closed ended statements,
because they are straightforward in nature, reduce the possibility of errors regarding
bias and invalidity. (Bryman and Bell, 2011)

39
3.5. Quantitative Data- Indicators, Reliability, and Validity.
There are three main reasons for the preoccupation with measurement in quantitative
research. Measurements allow us to delineate fine differences between people in terms
of the characteristics in question. A measurement device provides a consistent
instrument for gauging differences and provides the basis for more precise estimates of
the degree of relationship between concepts. For example, if one measures job
satisfaction and the things with which it might be related, such as a fair and transparent
appraisal process, then one is able to produce precise estimates of how closely they are
related. (Bryman and Bell, 2011, p. 154)
3.5.1. Indicators.
In quantitative research, in order to measure a concept, “it is necessary to have an
indicator or indicators that will stand for the concept.” (Bryman and Bell, 2011, p. 154).
In this research, Indicators will be devised through a series of statements that will form
part of a self-completion survey. The statements could be concerned with the
respondent’s report of an attitude, or their employment condition or a report of their
behaviour. In this case, the statements in the survey have been devised keeping the
main objectives in mind, for instance, peoples response towards employee participation,
motivation, reward in the process of the performance review, having a fair and
transparent system to follow, realistic and achievable targets, the influence of HR in
supporting the performance review process. The focus of this social survey will be to
use multiple-indicator measures such as, (‘strongly agree’, ‘agree’, ‘disagree’, ‘strongly
disagree’) in order to avoid the reliance of a single indicator that might classify
individuals or their information incorrectly. In this way, by making a number of
statements, the researcher can make deductions and get across to a wider range of
aspects of the concepts. (Bryman and Bell, 2011).

40
3.5.2. Reliability.
“Reliability refers to the consistency of a measure of a concept.” (Bryman and Bell,
2011, p. 158). In the case of this particular research, the chosen methodology is via
self-completion surveys using closed ended statements. The statements focus around
the main objectives of the research. A total of 75 respondents have participated in the
surveys covering 14% of the 5 Banks in the U.A.E. Therefore the nature of the closed-
ended statements in the survey, highlighting the objectives and the vast majority of
candidates will leave little ground for any miscalculation or misinterpretation in
measuring reliability.
3.5.3. Validity.
“Validity refers to the issue of whether or not an indicator (or set of indicators) that is
devised to gauge a concept really measures that concept.” (Bryman and Bell, 2011, p.
159). There are several ways of establishing validity and the one that best fits this
particular research design is known as ‘face validity’. “Face validity refers to the
‘obviousness’ of a test- the degree to which the purpose of the test is apparent to those
taking it. Tests wherein the purpose is clear, even to naïve respondents, are said to
have high face validity.” (Nevo, 1985 Cited in Bornstein, 2004.) The surveys prepared
for the purpose of data collection have been formulated with straightforward statements.
These statements have been formulated transparently, keeping in mind the topic and
occupational criterion of the respondents. Due to the nature of the self-completion
method used in the survey, it is highly unlikely for any invalidity in the results.
3.6. Conclusion.
To recap the above briefly, the main purpose of this research is to find similarities
and/or variations in the perspectives of the appraiser and appraisee, with regards to the
performance review process in the banking industry. The aim is to focus on the
objectives of this research by analysing primary data against theory. The research
methodology includes the use of a quantitative approach to data analysis, which will
amalgamate the collection of data using a cross-sectional design to detect patterns of

41
association. Data collection will be conducted on 75 participants via surveys, using the
Thurstone Scale. Respondents will be asked to choose from a set of closed-ended
statements encircling the objectives highlighted in chapter 1. Furthermore, the reliability
and validity of the surveys, and consequently of data analysis has been enhanced and
fully secured by using a transparent and uncomplicated approach to sampling 14% of
the Banks in the region. Unlike other organizations in different sectors that focus on
varying techniques in conducting performance reviews, the Banking Industry in this
region carries the advantage of sharing a similar outlook in their performance review
process, which provides additional reliability against errors in the sampling technique
used for this reserach.

42
4. Findings and Discussion.
4.1. Data Analysis- A Brief Overview.
The data in this research has been obtained via conducting surveys involving 5 Banks
in the United Arab Emirates. As mentioned previously, due to anonymity, the Banks will
be referred to as Bank A, B, C, D and E. 75 participants across the 5 Banks have taken
part in the survey. However, for the purpose of an in depth comparative analysis of the
performance review process in these Banks, the respondents have been split into two
categories- the appraiser and the appraisee. By establishing a perspective from both
sides, the gap between rhetoric and reality can be clearly highlighted. Out of the 75
participants, 39 are appraisers, and 36 appraisees.
An individual summary involving the number of respondents in the survey from each of
the 5 Banks has been compiled and is attached in the Appendix for reference only. In
addition, an aggregate chart summary of the results in percentages from the two
surveys (appraiser/ appraisee) is also attached in the appendix. The focus of the
research, and consequently of data analysis is going to involve obtaining perspectives
of both, the appraiser and the appraisee, across all Banks ‘combined’, rather than
providing an individual comparison of the Banks. Moreover, for this purpose, a detailed
aggregate summary, split into two categories to accommodate the perspectives of both
the appraiser and appraisee has been formulated into a chart below to highlight the
following features:
 There are 21 statements in the two surveys, which are similar in content, but
cater to the individual perspectives of the appraiser and appraisee.
 The total percentage of participant’s results across the 4 indicator measures in
the surveys.

43
Appraisee
Statement No Question (Appraisee)
Strongly
Agree Agree Disagree
Strongly
Disagree
1
The shareholders/top management performance expectations
are in line w ith the market conditions. 9% 57% 29% 6%
2
The financialgoals are realistic and achievable.
3% 53% 43% 0%
3
Job descriptions is clearly explained and discussed with me.
6% 79% 15% 0%
4
There is a fair weighted balances between financial and non-
financialobjectives Key performance Indicators (KPI) 6% 64% 25% 6%
5
The goals and KPIs are discussed and agreed upon between
my line manager and me.
11% 63% 26% 0%
6
There are fair levels of behavioralcompetencies in the review .
6% 59% 26% 9%
7
The process includes training and development requirements
for me.
6% 71% 23% 0%
8
The cycle of the performance review along with rating system
is transparent and understood by all.
14% 56% 31% 0%
9
At the end of each review period, the achievement Vs. the
expectations is individually discussed with each employee. (
as opposed to final submission in the completed PR form).
6% 71% 23% 0%
10
I am given a chance to explain my achievements and
shortfalls. 15% 74% 12% 0%
11
My feedback is documented and forwarded to HR for a
meaningful analysis.
3% 57% 29% 11%
12
Ratings for each KPI and overall ratings are discussed and
agreed upon w ith me.
0% 66% 34% 0%
13
Adequate action plans are made for improving my future
performance.
3% 44% 53% 0%
14
Adequate training and development programs are planned for
improving staff skills, know ledge and abilities.
9% 57% 34% 0%
15
The overall performance review process is fair and
transparent.
3% 49% 49% 0%
16
The overall performance review process is effective in
achieving the management’s objectives.
6% 66% 29% 0%
17
The current performance review process fairly rewards and
motivates employees.
3% 37% 57% 3%
18
The performance review processis lengthy and bureaucratic.
20% 37% 43% 0%
19
The performance review process involves more monologue
than a dialogue betw een the manager and me.
3% 50% 47% 0%
20
The performance review processends up demotivating staff.
11% 40% 49% 0%
21
The performance review process should be short and to the
point.
29% 66% 6% 0%

44
Appraiser
Statement
No Question (Appraiser)
Strongly
Agree Agree Disagree
Strongly
Disagree
1
The shareholders/top management performance expectations are in
line w ith the market conditions.
15% 59% 26% 0%
2 The financialgoals are realistic and achievable. 5% 59% 36% 0%
3
The job descriptions of the staff are prepared in consultation w ith
HR and in agreement w ith the line managers.
13% 62% 18% 8%
4
There is a fair weighted balance between financial and non-financial
objectives Key performance Indicators (KPI)
5% 62% 31% 3%
5
The goals and KPIs are discussed and agreed upon w ith each
employee w ith clear understanding.
0% 74% 26% 0%
6 There are fair levels of behavioralcompetencies in the review . 3% 65% 32% 0%
7
The process includes training and development program
requirements for each employee.
8% 79% 13% 0%
8
The cycle of the performance review along w ith the rating system is
transparent and understood by all.
5% 72% 18% 5%
9
At the end of each review period, the achievement Vs the
expectations are individually discussed with each employee. (as
opposed to w hat is submitted in a completed PR form).
8% 68% 24% 0%
10
Appraisee is given a chance to explain his achievements and
shortfalls.
13% 60% 25% 3%
11
Adequate feedback is documented and compiled by HR for strategic
review .
0% 59% 38% 3%
12
Rating for each KPI and overall ratings are discussed and agreed
upon w ith each apraisee.
5% 64% 31% 0%
13
Adequate action plans are made for improving future performance of
appraisee.
5% 79% 15% 0%
14
Adequate training and development programs are planned for
improving staff knowledge and abilities.
8% 82% 10% 0%
15 The overall performance review process is fair and transparent. 3% 64% 28% 5%
16
The overall performance review process is effective in achieving the
objectives.
0% 68% 29% 3%
17
The current performance review process fairly rewards and
motivates employees.
0% 46% 49% 5%
18 The performance review processis lengthy and bureaucratic. 8% 46% 43% 3%
19
The performance review process involves more monologues than a
dialogue betw een the manager and the appraisee.
5% 55% 32% 8%
20 The performance review processends up demotivating staff. 0% 45% 53% 3%
21 The performance review processshould be short and to the point. 14% 75% 11% 0%

45
4.2. Approach to Data Analysis.
As mentioned above, the design of the survey involves two separate sets of statements
corresponding to the perspectives of both appraiser and the appraisee. The 21
statements used in each survey define the main objectives of this research. The
respondents have a choice of selecting the most appropriate one by using the indicator
measures in the surveys shown in the two charts above.
For the purpose of data analysis and an in depth inquiry into the two varying
perspectives of the appraiser and the appraisee, the preferred approach will be to split
the 21 statements from both surveys into 6 themes that will cover the main research
objectives. These main themes are:
 Realistic Goals
 Balance between the KPI’s/ Competencies.
 Employee Participation.
 Employee Growth / Reward.
 Fairness / Transparency
 Role of HR.
The results of the surveys will be broken down into percentages and discussed in detail
using bar charts for each theme. By using these themes, appropriate links will be made
to theory using primary data, in order to critically analyse the role of the performance
review process within the Banking Industry in U.A.E. Following is a comprehensive
discussion on the six individual themes.

46
4.2.1. Theme 1. Realistic Goals.
The above theme in the bar chart covers statement Nos. 1, 2, and 16 from the surveys
that cover the topic of realistic and achievable goals in line with shareholder
expectations and market conditions. The results indicate a minor discrepancy between
the appraisers perspective and that of the appraisees. The former are just slightly in
majority in their overall agreement at 69%, compared to the 65% of the appraisers in
comparison. These results indicate a slight variation in how the management, who are
responsible for delegating targets, view them as realistic and achievable, while some
employees feel otherwise.
Another inconsistency, although minor in comparison, appears in statement No.16
regarding the effectiveness of achieving objectives. The appraisees disagree by 35%
compared to the appraisers at 31%. In either case one third of the respondents feel that
goals are not realistic and in line with the market. However, as theory clearly suggests,
“Setting goals or objectives is the most important activity during the performance
planning and agreement stages of performance management.” (Armstrong, 2009, p.
97), which holds true for any organization, specifically in the financial industry where the
primary focus is on increasing profits. The academics recognize this and as such
suggest, “The first priority is to ensure that managers are appropriately trained in the
arts of goal-setting and performance assessment.” (Walters, 2009, p. 72). In addition,
“expectations should be set at the level of the team, and each team member should
know his or her expected contribution.” (Hope and Player, 2012, p. 347).
6%
59%
33%
2%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Agree Disagree Strongly
Disagree
Appraisee: Theme1- Realistic Goals
7%
62%
30%
1%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraiser: Theme 1- Realistic Goals

47
Findings from primary data to some extent do not reflect a shared understanding
between the manager and employee with regards to goal setting. There is also an
evident lack of employee participation with regards to the achievement of objectives.
The findings suggest that managers have shown a tendency to disregard theory, where
“people at each level should be given the opportunity to indicate how they believe they
can contribute to the attainment of team and departmental objectives.” (Armstrong,
2009, p.101). If appraisees feel that managers are setting inappropriate or unclear
objectives, there is obviously a need for better communication of the organizations’
needs and goals. After all, the main aim of the goal-setting process is where both
manager and employee share similar expectations.
4.2.2. Theme 2. Balance between the KPI’s/ Competencies.
Theme 2 includes statement Nos. 4 and 6 from the surveys that focus on the fair
weightage between the financial measures (KPI’s) and the behavioural competencies.
According to the results in the chart above, amazingly there is a complete overall
agreement between both the appraisers and the appraisees at 67%. These results
therefore indicate that both management and employees across the 5 Banks agree with
the balance between the KPI’s and the competencies against which they are assessed.
This also proves that the process in the 5 Banks is being followed in accordance with
best practice. It is indeed a remarkable outcome, particularly in the financial sector,
where it is often assumed that financial measures take precedence over behavioural
competencies, which are an equally important part of the performance review process.
These results are in contrast to the scepticism reflected in theory, for example, an
6%
61%
26%
7%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraisee: Theme 2 - Balance
Between KPIs / Competencies
4%
63%
32%
1%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraiser: Theme 2 - Balance
Between KPIs / Competencies

48
observation of the appraisal system of an Investment Bank revealed that managers
were generally hostile to what they perceived as bureaucracy and disliked form filling,
particularly when ratings were linked to pay. (Cited in Armstrong, 2009, p.44) Typically,
this scenario also induces fear and concern amongst the employees where there is
“more emphasis on the link to pay and little concern about development”. (Cited in
Armstrong, 2009, p.49). However, in this case, findings have proven otherwise.
4.2.3. Theme 3. Employee Participation.
The above theme comprises of statement Nos. 5, 9, 10, and 12 from the surveys. These
four statements highlight the extent of employee participation in goal setting and
effective communication between the appraiser and the appraisee during the review
process. It is evident from the chart above that both the appraisers and the appraisees
are in overall agreement at 73% and 76% respectively, with only a slight variation in
perspectives. The difference, although negligible, shows while the appraisers might not
agree to a lack of employee involvement in goal setting and communication, the
appraisees feel a disconnect with their involvement in the overall process.
Results take a new turn in statement No.19 in the surveys, where the respondents have
been asked to either agree or disagree to the performance review process being more
of a monologue than a dialogue. In the aggregate chart, the appraisees have overall
agreed to this statement by 53%, with the appraisers at 60%. In other words, when
asked about the same concept using different words, the opinions of both appraiser and
appraisee change significantly. There is evidence of the appraisers indulging more in a
8%
68%
24%
0%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraisee: Theme 3 - Employee
Participation
6%
67%
26%
1%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraiser: Theme 3 - Employee
Participation

49
monologue during the performance review process, as pointed out by sceptics in theory.
Moreover, the appraisees perspective seems to have reiterated this imbalance
regarding communication.
Many academics and critics of the performance appraisal system have highlighted the
monologue vs. dialogue debate as an obvious dead-end, particularly if the weight tends
to lean heavily on the former. An obvious similarity reflecting those shades reveals that
one of the main problems with performance review is that “managers and employees
are reluctant to engage in candid performance discussions.” (Pulakos et al cited in
Armstrong, 2009, p. 48) Similarly, in addressing the one-way conversation syndrome,
theory clearly states: “We need a dialogue, not a monologue. We have to replace the
one-sided accountable, boss-administered/subordinate-received performance review
with a two-sided, reciprocally accountable performance review.” (Culbert, 2010, p. 146).
Findings clearly indicate a need for the managers to receive training in order to facilitate
a dialogue rather than indulging in a one-sided conversation with the appraisees during
the performance review process.
4.2.4. Theme 4. Employee Growth/Reward.
This theme takes account of statement Nos. 7,13,14 and 17 from the surveys. The
focus here is on improving employee performance through adequate training and
development and providing motivation by means of appropriate reward. There is a clear
indication in the above chart in the overall agreement from the appraisers perspective
by 77%. However, the irony of the situation is evident in the overall response from the
5%
53%
42%
1%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraisee: Theme 4 - Employee
Growth / Reward
5%
72%
21%
1%
0%
20%
40%
60%
80%
100%
Strongly
Agree
Disagree
Appraiser: Theme 4 - Employee
Growth / Reward

50
appraisees perspective (58%) regarding their own growth, motivation and reward. The
gap between the two perspectives is also highlighted in the disagreement surrounding
this theme. The appraisers at 22% are outnumbered by 43% of the appraisees who
overall feel their potential and reward is not being recognized in the performance review
process.
In statement No. 20 of the survey, again, a part of the same theme except worded as a
negative statement towards employee motivation, the appraisees have shown a large
agreement towards feeling demotivated at 51%, compared to the perspective of the
appraisers at just 45%. This provides an interesting perspective from both sides, where
the appraisers feel that they are doing their job in terms of developing and improving
employee performance and rewarding adequately, but the appraisees feel otherwise.
Regarding the above theme, theory clearly highlights the critical influence of employee
improvement plans and fair rewards, both of which impact staff motivation. Similarly,
literature has also stressed the importance of employee “recognition, achievement,
responsibility, autonomy, influence and personal growth” as part of the overall
performance review process. (Armstrong, 2010). The absence of which can demotivate
and destroy employee morale, as is evident in the findings. The results of the findings
would prove otherwise if managers were to “express appreciation and evaluate
employees on their strengths and weaknesses.” (Bowen, 2000, p. 126). It is clear from
the findings that the appraisers should be aware and conscientious of the importance of
feedback, as a motivational and rewarding tool for increasing the self-worth and the
resulting performance of the appraisees.

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