Updated: Oct 13
Measuring employee performance can be challenging, even when every effort has been made to develop the very best employee appraisal program for your particular organization. The truth is, we are all affected by a wide variety of rater biases that impact how we select our ratings during an evaluation. These biases might unfairly skew employee scores exceptionally high or remarkably low. Failing to take rater biases into account is a mistake many managers make, and this can result in not being able to obtain a true estimate of an employee’s performance.
It is worth spending some time learning about common biases and rating errors because they often happen unconsciously. Understanding these biases can prevent decision making errors, which strengthens your ability to use performance appraisals to their fullest potential. Read on to find out the most common types of rater biases and suggestions on how to reduce the likelihood of their occurrence.
If evaluations have any type of subjective measures, such as personal qualities or traits, ratings on performance scores can be significantly influenced by in-group-out-group bias. This is the tendency to favor those who are more similar to you and be more critical of those who are different from you. If you find yourself thinking “this person is just like me” or “this person is nothing like me”, you may be at risk of in-group-out-group bias. To counteract this bias, focus your appraisals on objective measures and competency requirements, not personal characteristics.
Central Tendency Error
Another very common rating error that occurs is the central tendency error. This happens when managers have the tendency to give everyone average ratings across all items. This is troublesome because when it comes time for promotional opportunities you do not have any valid sources of performance since everyone was rated as “average.” This bias prevents the manager from being able to provide guidance on specific areas of employee development. Therefore, it is important to make sure that you are carefully considering how the employee rates on each aspect of the appraisal.
“Employee X is a solid employee, but compared to Employee Y, he/she could do better.” “Employee X is a superstar compared to everyone else on the team!” If you catch yourself thinking any of these statements when sitting down to complete your evaluation, you could be in danger of being influenced by contrast bias. This is the occurrence of evaluating an employee higher/lower if a very strong or weak employee was recently evaluated. While it is common to contrast employees, contrast bias can lead to overusing comparisons when making your scores. Contrast bias can lead to overestimates or underestimates of a person’s abilities. Therefore, each employee should be evaluated solely on how they perform against the competency requirements, and you should not compare them with other employees. This information will provide you with more accurate information on how they are progressing in their position.
The next common rating error that occurs is the leniency/severity error. This is the tendency for managers to give everyone very high or low ratings. This is often driven by the desire for new managers to either want to look good to their subordinates that they are the “nice” manager or to look good to their own manager that they are “hard working and tough”. Leniency/Severity bias makes it difficult for a manager to capture an employee’s true pattern of strengths and challenges. To overcome this, it is often helpful to review the appraisal rating scale and understand what the different levels represent.
Primacy/ Recency Bias
Primacy/recency bias occurs when managers focus only on the beginning or end of the evaluation period rather than over the entire review process. This can lead to overestimates or underestimates of the employee’s performance if an employee has a really good or bad “streak” at the beginning or end of the review period. This leads to inaccurate ratings, which ultimately makes decision making difficult. It is important to take notes on the employee’s performance over the entire review period and review these notes prior to making evaluations.
Halo/Horns Rating Error
The last error we will discuss is the halo/horns rating error. We are all naturally primed to focus on single attributes that tend to stand out. The halo effect is when managers are susceptible to having a single positive attribute inflate the rest of the employee’s scores. Just as the halo influences you to think of your employees as perfect angels, the horns effect skews you to see others as devils. The horns effect is the tendency for a single negative attribute to cause raters to mark everything on the low end of the scale. One negative attribute seems to “spoil the bunch.” If you are afraid that you are being influence by the halo/horns effect, try soliciting continuous feedback from others to get a different perspective.
It is very common to be unaware of our biases that arise during evaluations, so it is important to make the unconscious, conscious. Hopefully the suggestions provided above have helped you begin that journey. Additional managerial training can help organizations educate managers on common rating errors in hopes of reducing these errors. If you haven’t had the chance to read our last article, How to Overcome Performance Appraisal Problems, it provides some additional tips on how to create the most effective performance appraisal system for your organization. You can also click here for a Performance Appraisal Factsheet.