Separate PMS from Salary Administration and Developmental Feedback
The hallmark of a successful performance appraisal/performance development process is based less on the perfect program and more on a reflection of ownership, support and acceptance at all organizational levels. Sadly, this is not the case even in the most evolved systems we see today.
To date there is no quick fix, but there are some considerations that could ensure a more effective system, and solicit greater support at all levels of the organization. What we have today as annual performance appraisals are not an adequate reflection of an employee’s work. The reviews rarely focus on achievements related to measurable goals. More often than not, they are mere reflections of one individual’s opinion to another, and even less, the feedback or opinion from the fulcrum of the business that is directly affected by the performance or lack of it i.e. the customer, internal or external.
The traditional and widely subscribed top down, one-on-one evaluations have lost the spirit behind which the entire system/exercise was first based on. There are several fallacies associated with the traditional perf mgmt systems, be it the BSC or any other. These critically affect both the organization and the individual. One of the major fallacies being the “one-shoe-fits-all” approach! It’s unrealistic to place varied and often contradictory set of demands upon one system. Ultimately, key components get neglected or compromised and the process fails. It remains just another process. Do we truly expect this one all-purpose system to be the tool to establish performance goals, measure results, and determine compensation from salary administration to profit sharing? Can we, at the same time, count on it to be the primary instrument to point out an employee’s strengths and development opportunities, coach for improved performance, determine training and development needs, and be the basis of management succession planning?
If we can just remember and hold sacrosanct that the primary objective of performance appraisal is performance improvement and employee development — everything else being secondary, we will have a system that makes logical and tangible BUSINESS sense- most of all, will be accepted not just as a process but in spirit.
This paradigm shift is no rocket science; it just needs organizations to break out of their inertia and the “we too have it” attitude to systems. The system can be easy updated through solutions such as 360-degree feedback, training and doing separate appraisals for various functions. Replace single-source, top-down assessment information with 360-degree data. The objective summation of confidential feedback from 6 to as many as 12 sources is far more enriched and powerful than assessment information solely from a single individual. Furthermore, individuals receiving 360° feedback find it difficult to refute and there is more private acceptance. Unlike traditional “top-down” performance evaluation, multi-sourced data gives individuals a clear comparison between how they see themselves and how others in their sphere of influence see them. Thus, individuals genuinely seek continuous self-improvement rather than simply follow a strategic set of behaviours fabricated to please a reporting manager.
Likewise, it is essential that the status of both salary administration and developmental feedback be elevated and SEPARATED from the PMS so as to ensure that each receives the focused attention it deserves. In the existing system, these critical systems are confused and lost in the mire of the PMS. This is essential to preserve and uphold the validity of the feedback so that there is no compromise on account of rank, salary slabs, etc. In fact, the PMS should be separated from the salary and developmental system by a few months so that performance remains distinct and focused and not just a decision-making process for salary evaluation.
It is essential and logical to make both, performance appraisal and performance feedback parts of an integrated “total systems approach” to continuous improvement. While doing this, it is important to ensure that evaluation and feedback criteria are a mirror image of the company’s mission, vision and values. Unless people sense a pure motive and genuine interest, they will not risk change and even less, acceptance! Author Sadhana Somasekhar, Joint Managing Director, Focus Infotech