New Delhi: Historically speaking, organizations have always viewed performance appraisal system as a process for weeding out non-performers and to some extent reward performers.
Shamim T, Associate Director, Zinnov Consulting
Viewed this way, performance appraisal systems had a niche role. However, with increasing pressure on getting the perfect fit in terms of job requirement and suitable candidature and then the tougher task of retaining talent and keeping motivation levels high, organizations are realizing the need to expand the relevance of the concept and perhaps to do away with the usage of the term performance appraisal system.
What organizations are waking up to is the fact that performance appraisal is only a small part of an end-to-end performance management system which involves an integrated approach including planning performance, managing performance, developing people, reviewing performance and rewarding performance towards building a high performing organization.
Successful performance management systems are modelled around three basic parametres:
* Letting people know specifically what needs to be achieved;
*Supporting that goal/s through performance coaching, mentoring and developing manpower/ human resource; and
*Rewarding and recognizing performers and managing poor performance
Planning performance involves translating corporate objectives into specific, quantifiable goals for every employee. This forms the cornerstone of the evaluation process, leading to feedback on how close to, or how far from those goals the employee is, at the end of the appraisal period.
In order to achieve this, it is imperative for the organization to set its employee up for success and therefore managing employees plays a key role. This should include an ongoing dialogue between the manager and employee to ensure that individual goals are aligned to personal and organizational goals. Also strive towards equipping the employee with the necessary skill sets that can enable him/ her to perform. Regular feedback is useful for he then knows where he is heading rather than letting it throw “year end surprises” in the form of unexpected annual performance appraisal/s.
Also, if used rightly, this process can significantly help in employee involvement in organizational building: when we invite employees to participate in goal setting and seek their feedback on their manager’s performance through 360 degree processes, it gives a very high sense of ownership and is a good source of “providing a voice” to the employee.
Objective setting to be well defined
A challenge that most organizations can face is on reviewing performance effectively and seeing how productivity can be measured?
A well defined objective setting will help in this process. Starting from the macro business level objectives and then breaking it down to departmental objectives and finally integrating it with individual objectives, organizations can set targets to review performance. Based on these objectives organizations can define the parameters to measure performance.
These parameters should also enable employees to set and meet their developmental goals. This helps in self evaluation and also looking at the broader picture that is in the interests of the organization at one level and at the employee’s own career graph on the other and then aligning the two smoothly.
Reviews to precede rewards
Organizations should ensure that employees are suitably rewarded for their efforts and that any out-of-the-box thinking/ idea development is acknowledged. Reward need not always be monetary or incentive driven. Non-monetary forms can serve as just as effective morale boosters, not just for the rewarded employee but also for the entire team.
It is imperative that the process owners of Performance Management Systems (typically it is the HR function ) clearly identify the needs and expectations of all the stake holders such as employees, managers, HR function etc and then address each of those needs with specific actions/processes and capabilities.
At the end of the day, the process has to be fair and perceived to be fair too. This is a tall order, but using ‘dialoguing’ processes will help to establish fairness and trust.
Best practices for employee appraisal
* Clear definition of the end-to-end process with timelines and process ownership;
* Understanding stakeholder’s expectations and having responses to each;
* Empowering managers to take ownership and driving the process;
* Having well-aligned learning and development strategies to make people successful;
* Developing dialoguing skills;
* Putting in place a system that allows good management of poor performers and exit process; and
* Introducing a balanced score card for balanced goal setting
Organizations cannot do away with Performance Management and appraisal as performance in the organization like any other resource management needs to be managed well in order to create high performance organizations. For that a well defined end-to-end system has to be defined. This must eventually be based on contingency/ reinforcement theory, where positive behaviour is rewarded and reinforced and becomes a repeat phenomenon.
Shamim T is an Associate Director at Zinnov Consulting and can be contacted on email@example.com