Unconscious Biases in Employee Performance Appraisals
Updated: Feb 12
Everybody is biased. Even with the best intentions and their best effort to stay objective, managers may unknowingly allow biases to affect the way they assess or rate employees. Here, we list some common (unconscious) performance management biases and tips on how to overcome them during performance appraisals.
"The vast majority of human decisions are based on biases, beliefs, and intuition, not facts or logic." - Daniel Kahneman, psychologist and Nobel Prize Winner
1) Recency and Spillover Bias
The human’s ability to recall certain events can have major impact on their results - this is especially true for annual or even quarterly performance appraisals. Recency bias is when a manager remembers the most recent performance of the employees, negating the full view of the employee’s performance since the last appraisal. Spillover bias is when a manager continues to assess an employee based on past performance, failing to take into account recent improvements (or failures). In either case, these biases cause employee performance to be under- or overvalued.
Solution: A great way to fight recency and spillover biases is by making feedback conversations more frequent (and document & store them in one place!). This allows managers to address the employee’s current performance and track their progress in real time. There are also a myriad of other benefits of providing more feedback (check out our article on the importance of feedback).
2) Pattern Recognition Biases
Our brains prioritize negative events over positive ones, and unfortunately this negativity bias can get in the way of professional development. Perhaps an employee had a failure on a past project, and despite good performance since then, the manager may have difficulty looking past the blunder. It can often create a vicious cycle - employee is viewed negatively, nobody wants to work with them, employee is stuck working with under-performing teams (because nobody wants to work with neither of them), performance suffers, so on and so forth.
The opposite of this bias, halo bias, can also be just as damaging. For example, if an employee had a great idea or has done great work in the past, managers might prioritize the track record of the person, over their more recent performance. The result is the manager can overlook negative aspects about the employee and fail to address performance issues or problematic behaviors. Similarly to the vicious cycle mentioned above, halo bias can create a (undeserved) virtuous cycle for employees.
Solution: More frequent reviews and focusing on the employee’s specific behaviors since the last feedback conversation can help managers fight these biases. Remember, if progress has been made, acknowledge it. If performance needs improvement, don’t be afraid to offer actionable and forward-looking feedback. Try to provide honest and fair feedback.
3) Central Tendency Bias
Humans tend to categorize people and events, and when it comes to people, we tend to lump the majority of people as average. By lumping the majority of employees in the middle, managers will lose sight of the contributions and problems of employees. Central tendency tactics such as forced or stack rankings have a negative impact on performance.
Solution: Performance appraisals should focus on the individual. Focus on the employee by acknowledging their strengths and weaknesses and provide actionable feedback to help them enhance their strengths and address their weaknesses. Having frequent feedback conversations (instead of the once-a-year performance reviews) can help managers identify employee's strengths and weaknesses much easier.
4) Social Biases
Aspects such as race, gender, and age can unconsciously affect how a manager assigns goals to an employee and how they assess their performance. Moreover, these unconscious biases may even be within the hiring process. A recent study in the UK found that gender bias can actually affect how companies write job advertisements; certain terminology has been found to attract applicants of one gender more than another. We need to be able to identify and calibrate for these biases.
Solution: Regular, ongoing unconscious bias training and coaching can help address issues systemically and effectively. Creating a more inclusive work environment where managers celebrate differences will also help minimize the effects of social biases.
Want us to address other common workplace biases? Let us know!