Everything You Should Know About Performance Appraisal

Everything You Should Know About Performance Appraisal

The truth is that performance appraisal is an essential part of everyday life. It’s not about judgments of people surrounding you — it’s usually YOU wanting to know how well you did. Think about when you crave an opinion of how tasty these pancakes you made were or measuring how far you can run while keeping that tempo. It’s completely natural to feel motivated by your accomplishments or the idea of improving them. Actually, it’s the goal everyone’s trying so hard to reach: to get better. Improvement wouldn’t be possible to achieve without knowing how well you’re doing right now and what needs to be changed.

Since it’s already established that evaluation is necessary for self-development, it seems to be obvious how elementary it is for your company’s employees. We’ve not even mentioned that the correct method of employee performance appraisal is crucial for creating a good motivational system. These two actions could easily determine how simple managing people in your space is. The methods vary, which makes it hard to even find two companies that use the same system or forms. Thankfully, however, we can group them by functionality to make it easier to understand the myriad variations.

People or software

A performance appraisal can be conducted by someone or via software. Of course, in case of every group I’ll be talking about, it’s possible to have a system that is a combination of the two. That may actually be the better idea, because it gives you a nearly complete view of employee performance without any major loopholes.

The main difference between having a performance appraisal done on software and one done by a real person is objectivity. Despite the best intentions they may have, people cannot eliminate their personal feelings, impressions and intuitions when it comes to making judgments. It’s hard to step aside and look at someone as a statistic. It’s natural to lean towards the staff we “feel for” or personally like or find useful. Moreover, the sense of justice is usually based on feelings, which are completely subjective. Employees need to feel that the review they’re given is correct and fair. Evaluators can’t have doubts about the validity of their decisions that will be based on the performance reviews. The workers also need to feel like they’re all treated as equals, by fair, unbiased supervisors. That’s something way easier to achieve when the performance appraisal is made by software. Not only it is hard to argue with the accuracy of your software’s math calculations but it’s also difficult to claim it has bias toward various employees or “plays favorites”.

The right software is also a better tool than human when it comes to direct work measurement. When a human is watching the work, the employee knows he’s being observed. People always act unnaturally, when they feel that somebody’s watching their activities. Instead of doing what they’re supposed to, they start thinking about whether what they do is correct and how they will be judged for that. It’s extremely stressful, not only for the employee, but also for the person conducting the performance appraisal. This causes errors in performance by the employees and errors in scoring by evaluators. Putting a software program in place of a human analyst helps to eliminate these errors. Software makes it impossible for a worker to tell when his work is being analyzed. Moreover, the system is pure math, so it’s harder for employees or evaluators to cheat. With the mathematical calculating accuracy of software, It avoids measurement mistakes too. An example of how this works is with work sampling (the technique for determining how much time employees spend on various activities), where observations are taken randomly throughout some period of time in order to keep accuracy high. 

Individuals or groups

Methods of a performance appraisal can be divided into individual and group evaluations. For each method there’s a myriad of possibilities. There’s a critical incident method for individuals and there is, paired competition or ranking for larger groups. Choosing which one is better for a company depends mostly on how many people work in that company, because some methods are easier to conduct on smaller staff. Methods can be also divided into absolute and selective ones. A method that is “absolute”- based means that the employee’s performance is compared to some set standard (which then becomes a set of expectations for the employee) — and the appraisal is based on the result of that comparison. Selective methods don’t have an absolute set, they’re based on comparison of employees’ performances with each other.

Common methods

When it comes to one of the most popular methods of performance appraisals — scale rating –– you should understand that it’s based on making an evaluation of the individual employee’s attitude toward such traits as punctuality, sincerity, level of engagement with their work, and more. These traits are ranked between 1-10 points on a scale (where 10 means high feedback and 1 basically stands for none). Another really popular technique is paired competition, which is conducted in a group. It works by comparing two employees together and rating which one of them has the better performance (and then usually rewarding the one who does).

Mistakes happen

In theory all of these methods seems to be easy, well-known and quite basic. The real thing starts when your turnover rate stays the same or increases. Then it’s time for you as a supervisor or HR professional to look at your work and think, what am I doing wrong with my employee performance appraisals? And why don’t they work as they should to help us improve?

Incorrect evaluations happen all the time, everywhere, but they may have unexpected and negative effects when it comes to your employees. Consider the idea of the “self-fulfilling prophecy”. You’re making mistakes that result in a review of your employee that is less than fair. That makes him care about his work less and less and his work becomes sloppier and sloppier until by the next review, he truly deserves the poor performance appraisal. The same goes for situations when the employee feels like the evaluation is unfair and doesn’t accept it. She won’t try to get a better rating from you. Instead, she’ll feel like the whole evaluation system meaningless and often, she resents it and can cause unrest among other employees., That can happen when the appraisals are based on personal feelings of the evaluator, or when the appraisal is made without honoring the established rules. That could easily make the employee turnover rate go higher. To combat that, it may seem like the lesser evil would be not to inform your employees about their performance appraisal at all. However, that: won’t do any good for them (or you). More likely, if it doesn’t demotivate them, it will surely make them feel confused.

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