Posts Tagged ‘Performance Rating’

Rating vs. Ranking

In the language of performance management, the terms rating and ranking are many times used interchangeably to indicate someone’s standing in the overall performance management process.

While rating can mainly be applied in the performance context, the term ranking has more ample, yet focused usage, in the overall talent management spectrum.  In fact, at any given time, someone’s rating may be higher than his or her ranking.

Performance Rating

A rating is supposed to be assessed for the actual performance of a given year.  As commonly known, someone’s performance carries the execution of specific goals along with the skills they exhibited to carry out those objectives.  The combined assessment of what they accomplished and how they accomplished it makes up the final rating for that year. In theory, someone ranked highly in the talent review process should demonstrate high performance year over year. In practice however, even highly talented individuals may have “off years” where they did not achieve all the expected objectives. This does not necessarily mean that their talent has diminished or that they should be viewed as such.  Doing so would not only indicate that the organization is throwing away investments made in talent, but it would also demoralize someone who has demonstrated both high performance and high potential. The natural next step in this case, is to work with the individual and lend support to get their performance back on track.  What ends up happening at times however, is that we find ways not to rate a previously high performer any lower than their prior year, or just as negligently, once their performance deteriorates in one year, they are written off as “have been.”  On the other hand, people with a lower rank in the talent review, may have a year where they exceeded all goals and operated at a higher level than in previous years. Then too, should their work and effort be recognized and rewarded with a high rating in their performance review.  Conducting performance management this way lends credibility to the process.

Talent Ranking

Most medium and large organizations want a snapshot of who their top 10-20% players are. Having this important information is a first step, but more is needed to have a clear understanding of who among the top 10% may be more critical to the operation. Ranking them in such a way forces talent differentiation and at times, role differentiation, not just performance differentiation. In addition, it offers other advantages, including realizing succession gaps and knowing whom to invest further in and attempt to retain. Ranking should be done at the organizational level as well as the departmental or functional level.  Following the above advice on performance rating, it is entirely possible to rate someone at the top tier of performance management one year, while ranking them lower in the talent reviews and vice-versa. The use of rankings will be discussed more in detail in future posts dealing with talent reviews and succession planning.

HR leaders are wise to advise their business partners to maintain awareness of these differentiations to avoid “halo effects” as well as “false negatives.” These types of subtleties are important if we are to keep both the performance management and the talent review process with the expected level of integrity. Undoubtedly, the time will come when knowing the difference will aid decision makers in dealing with a talent conundrum.

Similar to the way organizations consult with their HR departments, "HR for HR" is a term used in some organizations as the area where internal HR staff may turn to when they need advice, counsel, or mentoring. is a site dedicated to further the understanding of HR's unique consultative approach, strategic focus, and people-oriented business alignment.