When they’re done well, employee feedback programs can give your firm a real competitive edge. They can help employees improve in key areas, encourage innovation and collaboration, and can increase employee engagement and productivity. But when they’re done poorly, the mis-guided performance appraisals and stagnant employee suggestion programs can suck the life out of a good firm. Employee morale suffers, conflicts and tension reign, and collaboration is dishonourably pushed aside in favour of competition and politics.

I’m sure that most senior leadership wouldn’t consciously choose to lead a firm that no one enjoys working at. But when employee feedback programs don’t work the way they are supposed to, it usually means that there are other, more fundamental issues that need to be addressed. Choosing to ignore those issues can get pretty costly.

Happy, Productive Employees = Competitive Advantage

Gallup poll research indicates that only 13% of employees around the world are actively engaged at work, and more than double that number are so disengaged that they are likely to spread their negativity onto others. In other words, only about one in eight workers are mentally and emotionally committed to their jobs and are likely to be making positive contributions to their companies. In major economies, such as the US, this costs companies between $450 and $550 billion each year, and puts them at a big market disadvantage. On the other hand, according to The State of the American Workplace study, companies with 9.3 engaged employees for every actively disengaged employee experienced 147% higher earnings per share (EPS) on average compared to their competitors.

From feedback we receive from candidates all over Australia, I believe these figures to be similar for Australia and in particular Architecture and Interior Design firms.

Given these numbers, senior leaders should be making every effort to ensure that the majority of employees feel satisfied with their accomplishments, motivated to do their jobs, and are able to get along with their peers and leaders. Sitting front and centre of these efforts are employee feedback programs.

Where Employee Feedback Programs Go Wrong

But most firms do have some kind of program in place for employee feedback or appraisals. So, the question is, why aren’t these programs working?

While there may be several factors at play, from my experience, they all tend to fall into one of three categories:

  1. Team leaders and senior leadership don’t believe in the program’s importance. In other words, there has to be a shared core belief in the value that employees bring to a firm and in the feedback program’s effectiveness in nurturing and maximizing that value. Where that effectiveness is not there, the firm’s leadership is committed to testing things out and making necessary changes and improvements. Without this level of buy-in among team leaders and senior leaders, these programs will fall flat.
  2. The wrong feedback is being collected. Leadership needs to be measuring the factors that are real gauges of productive, motivated individuals and project teams. Sometimes feedback programs are weighed down by too much unnecessary information. (Anything longer than 2 pages is already suspect.) Firms have to cut out the bloat and focus instead on a few specific, measureable actions and qualities. They need to make sure that the assessment tools being used are giving back objective and actionable information and where necessary, are protecting employee confidentiality.
  3. There is no system in place to act on the feedback. This third factor brings everything together. Employee feedback data (or any other data for that matter) is only helpful and useful to the extent that it gets acted upon. When feedback is obtained and then quickly forgotten, it creates a situation that in many respects worse than it would have been had no feedback been given in the first place. It makes people numb and blind to the things that create real solutions for critical problems and prevents the studio or firm as a whole from taking advantage of the amazing opportunities for growth that exist both inside and outside of a firm.

Effective employee appraisal and feedback programs are organic value creators. When they fail to bring such value to the firm, then it’s a sure-fire sign that priorities need to be re-aligned.