“A performance appraisal system is critical to measure and manage all performance within the firm, be it individual, team or function,” says Shubha Kasi of Mercer Consulting, a human resources consulting firm. Understandable, considering that their objectives are aligned to the overall vision of the organisation. As Kasi explains: “The objectives set for the larger unit within the firm define the boundaries for performance requirement for units within this unit. Put in another way, any constraints on performance within the smaller unit, will also set the limits on performance for the larger organisation or unit.”
So when a group of individuals come together to work towards the same goal, it becomes essential to understand their abilities and identify responsibilities that are in keeping with those abilities. It is equally important for the organisation to be cognisant of the performances delivered by its people – to reward the stars and lend those lagging behind, a helping hand.
Unarguably, the performance of individuals, teams and divisions together defines the performance of a company. And organisations that hear the voice of its people will see a definite difference in productivity levels, a difference that will surely show on the bottom-line.
It is with this reasoning that organisations world over have introduced the process of performance appraisal. As defined by www.naukrihub.com, performance appraisal is the process of obtaining, analysing and recording information about the relative worth of an employee. It is based on the process of a performance appraisal review that teams and individuals understand their role within the larger framework.
The modus operandi to review a workforce might differ from one organisation to another. “Many firms use a combination of assessing what was achieved and how it was achieved – in other words, both goal achievement, and demonstration of desired behaviour,” explains Kasi. An individual is judged on numerous parameters. While the review is based on an employee’s objectives, participation in extra-curricular activities or accepting voluntary roles within the organisation add value to the overall performance.
Organisations choose to have performance appraisal reviews on a quarterly, bi-annually or yearly basis. Traditional organisations record their findings on paper while the multi-nationals or new organisations prefer to use specialised software to aid them in the process. “An increasing number of performance systems are also being made available online and thus integrated with salary and career systems,” adds Kasi. While such systems are in vogue, some questions have been raised on the efficacy of the process. “Irrespective of the method used, the effectiveness of a review can only be judged by how willing an individual is to correlate the feedback received to day-to-day practices, in order to make the necessary tweaks,” says Kumar Venkatraman, senior vice-president at Symphony Marketing Solutions India, a company that provides technology-enabled marketing services and solutions.
An organisation must encourage a two-way dialogue. “Somebody could have had a good year and a lousy last quarter. For a manager to get a better understanding of the individual’s most recent performance, organisations must encourage their employees to articulate their stories,” says Prashanth Venkatesh, senior business development executive at Eaton Corporation, diversified industrial manufacturing company. This encouragement comes in the way of special training offered on the do’s and don’ts at a performance appraisal review, offered by most organisations. There are a few like Syntel that go the extra mile by training their managers to be more receptive. “We conduct two specific workshops, one for employees to gain a complete understanding of the process and another for managers to help them identify data points while assessing an employee,” says Sharmithra Ramadoss, employee relationship manager, Syntel.
Typically, these appraisals decide an individual’s salary increment. Given the sensitive nature of this process, it is paramount that all judgment be made fair. In this regard, performance appraisal systems have evolved significantly since their inception. “After years of refinement driven by changing employee profiles and management cultures, performance management systems in mature and professionally run organisations are relatively transparent. It is common to hear of 360 degree coverage in appraisal systems. There is a step beyond this as well with a skip-level review, where as an employee, I can go to my supervisor’s supervisor,” says Kasi.
When asked of any professional jealousy that might result from the process and how an organisation must deal with it, Kasi says: “Jealousy in the workplace is best dealt with by dealing more clearly and pro-actively with expectations and consequences of performance. When feedback is supported by objective and balanced data, there is scope to turn professional jealousy into healthy competition, which can raise the organisation’s performance overall.”
Amongst the new methods in performance appraisal is the upward review- where a subordinate reviews his or her manager. In most cases, these reviews are anonymous in nature to encourage honesty and negate any resultant bias. The stereotype of a dictatoresque manager is one that is fast fading, thanks to the dialogue that this process generates. “The current generation is quite forthcoming. Most people these days are vocal about their opinions,” says Venkatraman. Kasi supports her statement by saying, “Gen Y is more forthcoming and is more comfortable with providing feedback and today’s managers are also keener to receive and incorporate feedback from multiple sources.” What is most essential for an upward review to be successful is the culture of the organisation and its managerial style, she adds. An opinion that IT professional Ananthanarayanan shares: “My reluctance to air opinions might depend on how people-friendly the management is perceived to be.” He also states that in his experience of having worked at an organisation with a workforce of less than 25 individuals, being completely honest while participating in an upward review was near impossible. “In a smaller organisation, your boss might be able to guess whose review it is despite the anonymity clause and it could have an adverse effect on your rapport.” Innovative means are being used to help in improving and appraising performance. The upward review is only one such; surely more will follow in this field that is forever changing the norms.
In a services-driven economy, where people are the backbone of most organisations, it is essential for them to adopt methods to ensure employee loyalty and satisfaction, something that is most evident during performance appraisals. Any interaction between a team manager and team member is critical in tackling people- related issues, most important being attrition. It is perhaps not about the number of times these discussions are held, it is more about the nature of the discussion itself- how receptive is each rung of the organisation to the needs of its people? Unarguably, the performance of individuals, teams and divisions together defines the performance of a company. And organisations that hear the voice of its people will see a definite difference in productivity levels, a difference that will surely show on the bottom-line.