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Performance Appraisal – demystified !! De-stress the process by simplifying

Why did they change?

We’ve been hearing that companies are moving away from annual review types to periodic reviews. Biggies like Microsoft, Deloitte, Adobe, etc. have taken this giant step in the recent times. Certainly, they had faced issues in the past and brought in this phenomenal change. They are experiencing real time growth and that is the trending news now. Initially they believed that annual performance reviews would enable organization’s growth. Ironically when it did not, they changed track.

Why do annual reviews fail?

The most important thing is that performance appraisals is like a ritual that is being followed in most of the organizations once in a year. This type of reviews has the biggest de-motivating factors like the recency bias, predefined bell curve, ranking employees, and forced-fitting employees. Also, it is not just a nightmare to employees but to HRs, as well. Manually done performance reviews involve hectic paper work, formatting and structuring the performance curve according to the salary curve, normalization process, etc.  At the same time you just cannot throw away annual reviews because you need some mechanism to split the employees into groups of “super-performing”, “ok-performing” and “not so ok-performing”. So, how can we achieve this?

rating system

What needs to be set right?

– Organizations should make employees focus on key objectives. Technically we say KRAs & KPIs.

– Enable constant communication between manager and his employees to enhance active collaboration.

– Introduce more frequent feedback sessions between manager and his employees that are pivotal to organization’s growth.

– Eliminate forced-fitting employees into predefined bell curve.


So, how can this be set right will make the rest of my blog.

New Trends in Performance Management
Define SMART Goals

SMART goals is nothing but an acronym that defines goals a little deeper. A goal should be formulated in such a way that it is Smart, Measurable, Achievable, Relevant and Time-bound. It clearly says to have objectives set within the scope of the employees and ensure that it is aligned towards the path of the organization. And it does not stop here but is completed only when the employees are tracked and looked upon their targets.

measurable goals

The value of conversation

Constant communication between manager and his employees will have great impacts on the targets achieved and also will improve the employee quotient to achieve better results. When employees are given objective and constructive feedback, they get carved to showcase their best. Even they have chances to learn things that are not very familiar to them. This type of ongoing communication will keep employees engaged towards work at the same time increases the efficiency of the job done.

reward and celebrate

Periodic Reviews and regular Check-ins

Timely feedback and meaningful discussions will allow managers to review priorities and provide course correction. Employees will be highly engaged as they are constantly noticed and nurtured. Also, periodic reviews not just push employees but also act as a motivation check point to work better. Periodic reviews will deviate employees from their stereotype of addressing issues. It is not held just to complaint an employee’s type of work but includes appreciation notes when employees perform well.

manager - employee communication

Remove Forced ranking and Force-fitted Bell curves

rating employees

I’m not complaining that once a year way of reviewing performance is wrong but to tweak it a little such that it suits the current trends is my argument. Now, there are two types of bell curves – salary curve & performance curve. Organizations design the salary curve even before assessing employee’s performances and only then the performance curve is drawn. Anyhow there is the least probability for these two curves to replicate each other. So what happens eventually is that performance curve is pulled and pushed to come in-line with the salary curve. Let us not do this anymore and allow the performance curve to flow freely.

bell curve

Need of the hour

What is needed is a simplified agile system that is a perfect composition of robust technology that requires minimal administration effort but enhances employee engagement. The new trends in HR is the programmed software that incorporates all the features that you will need in a Performance Management system, that will compile reports in seconds, consuming very little time on analyzing performance data. Also, the software facilitates managers to identify employees who need training and put him through a recommended training program that will improve the employee’s performance level. The needful components of a typical performance management process when put together in way that will increase engagement, retention decreasing turnover rates constitute a REAL PERFORMANCE REVIEW SYSTEM.

manager-employee session




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