Success of an organization is defined not only by its ability to acquire the right talent and resources, but also by its ability to retain that right talent. The performance appraisal process directly impacts the attrition of employees in any organization. Therefore, managing performance appraisal process for HR is a critical activity that has a domino effect on multiple processes across different departments in the organization. In a conventional setting, the process poses a few major hurdles for HR which are captured below:
1. Defining and aligning objectives for the year
Just like running a sprint without a finish line might be a futile exercise, employees working without set objectives is a wasted effort. The employees must be aware of what the company objectives for the year are and what individual key result areas they must target to contribute to overall company objectives. In case either of these is unclear, it may lead to loss since the unwarranted efforts of the employees may not produce maximum profits for the company.
2. Facilitating timely conclusion of appraisal process
Almost always the appraisal process commences on time in organizations but concluding it timely becomes almost impossible. Offline processes are disadvantaged in this regard since personal requests to HR for deadline extension of review completion are inevitable. On top of it, tracking the employees who are yet to complete review process and sending separate reminders to them for completion of their review is an arduous task in offline or legacy systems. Delay in closing the appraisal process by even a month could negatively impact the organizational cost and employee engagement both.
3. Resolving conflicts between managers and employees
A conflict situation may arise when the employees don’t agree with the rating provided to them by the manager. This disagreement could stem because of the rater’s bias, inefficient communication, leniency or central tendency or other such reasons. It is important to have a system in place to eliminate these conflicts proactively and reactively for an amicable acceptance of feedback.
4. Regulating continuous feedback
A lot of environmental volatility could occur between the duration of task completion and the end-year review like change of reporting manager, promotion, or a long leave of the employee which could increase information gaps or pose a risk of recency effect during the appraisal.
Organizations try maintaining a continuous performance management process through excel sheets or feedback forms due to which employees end up spending too much time during review in collating data from different sources. A formal system needs to be in place which keeps a record of this continuous performance and its feedback.
The aim of a performance appraisal process should be to objectively evaluate the performance of an employee and contribute towards their growth. Any glitch in the process due to administrative or technical issues could cost your organization valuable resources and revenue. Keep an eye out for innovations in HR tech space that have been morphing at a breakneck speed to resolve all these issues and provide a win-win situation for both the employee and the employer.
We at Motherson Technology Services are working to elevate the experience of both employees and employers with our continuous performance appraisal system. Click here to learn more about how you could step-up your performance appraisal system to increase your bottom line.