Performance Appraisal Aims to develop a performance driven culture at an organisation culture. For any Organisation, people are its key assets and every team member should contribute to the best possible potential. It is a part of process involving guiding and managing career development through obtaining, analyzing and recording information about the related work of an employee to the organisation.
Its purpose is to provide the direction and clarifies performance expectations; provide training inputs and professional development needs. For me in a nut shell, it’s like a bull’s-eye exercise to analyse hits and misses of the employee in the said period & if done in right spirits may give you the exact hits and misses at an organisation level and road-ahead to plan.
For every staff it provides a clear opportunity to take charge of their career transformation, training needs and also gives a chance to get recognised for extraordinary efforts made, if any.
A normal performance appraisal is carried out in every financial year. Some innovative organisations have systems of measuring weekly/monthly/quarterly/half yearly performance also. Though I strongly recommend timely feedback, and it is very essential specifically at top X level. The frequency differs and should suit to the organization DNA in Toto. There can also be an informal chat process, not an appraisal but on the lines of employee engagement & especially with a new employee at least twice in first six months to ensure alignment. If so, it is clearly mentioned as people always have financial expectations from an Appraisal Process.
•Setting of Goals/KRA:
Setting goals is the most essential part of the performance appraisal process. These are drill down of organisation goal and are very critical for individual and team success. Concept of SMART (Specific, Measurable, Attainable, Realistic, Time bound) KRA’s is very important for accomplishing team, department and organisation goals. This is in lay mans term listing down of the functional competencies required for the role’s success.
•Bell Curve Distribution & Forced Rating:
Bell curve distribution and forced rating arisen out of it, is the process which compares performance of people engaged in similar activity. It is the relative grading method where the entire workforce is segregated into various slabs basis the percentile distribution.
The same can be traditionally 10%, 20%, 40%, 20%, 10% (normally in organisations on the rating scale of 5 to 1) or as per organization needs.
There is load of criticism on the bell curve and subsequently forced rating mechanism, some of which I am also party too. Having said so still, I strongly recommend it as a good method available to distinguish between performer and non-performer at an organisation/function/plant/department level. When I say distinguish, it should clearly reward the performers through some incentive program like career path or deferred-bonus or linked-pay for performance. It can be only successful, if it is impartial, transparent and can manage performer well. It should also inherently discourage non-performance and engages them to at least work towards better engagement & takes strict action again continuous defaulters.
•Post Appraisal Mechanism:
In India, we are very good at pointing out to an employee what didn’t go according to the plan? Are we are supposed to also tell him/her what the road head from here is on? I don’t think our role should be only of rubber stamp showing our superiority or should be a one-way forced rating. It is not the feedback is important; it is the feet- forward.
This can be done only if each employee is met personally post an appraisal, given a chance to discuss their performance during the year, challenges in the role and synchronise it to the overall organization goals and vision for the next year.
•Hi-Pot Employees:
A High Potential or Hi-Pot employee is an individual with the ability, aspiration and engagement to arise and succeed in critical position. They are capable of taking future responsibility. They are normally team members with knowledge, skill, emotional intelligence, cognitive ability, interpersonal skills and with a toping of willingness to take pressure.
How do you recognize them? Are they normally high raters year on year? The answer is yes to an extent but not true always. Apart from being high raters this breed have in them the ability to drive, to excel, learnability, spirit and dynamism as their X-factors. In a nut shell they are dynamos and can be identified easily by passion towards the organization. They are also normally people who are willing to teach or handhold each other and their team members.
Previously career paths for these high potential employees used to be for the length of 10 years but in todays fast pace environment 5 years period is enough, we may look at it post 5 years to continue it further.
•Succession Planning
This is the process to identify key areas and approximately top 10% critical positions. Subsequently the identification of competencies for these roles would help us in setting clear and well defined paths. Knowledge transfer strategy and evaluation of its effectiveness would help in a long way.
•Defining Core and Leadership Competencies at Organisation Level
It is very important to define core and leadership competencies which are related to organization overall mission, vision and objectives. They may also align the overall values of the organization for example may be i.e. Integrity, Change Management, Communication, etc. The Higher the role, the weightage of leadership competencies should increase.
The Role of Human Resources Team
1. Setting goals for appraisal systems
2. Train employees on goal setting
3. Developing criteria for successful performance
4. Creating matrix for evaluating performances
5. Selecting reviews and reviewers
6. Organisation logistics
7. Giving candid and constructive post appraisal feedback with the line manager
8. Follow up to ensure that the system works
Follow up for the organization
1. Use of forced ratings for gap analysis and need assessment
2. Track performance appraisal statics and measure its success
3. Train new hires, train reviewers and evaluate their feedback
4. Ensure that that the performance appraisal system is in alignment with business goals at the organisation level.
5. Survey the cost and benefits of the systems.
Your Performance, Review Forms should consist of following:
1. Key accomplishment in the previous review cycle.
2. Initiative taken for team enrichment
3. Factors leading to your achievement
4. Factors inhibiting your optimal performance.
5. Steps taken towards self development
6. Training needs
7. Career aspiration for future
Final Tips:
If your appraisal is round the corner, go through your past performance and analyse the areas where you excelled. While it is important not to ‘Tom-Tom’ about your achievements, yet, if you don’t accept and mention them straight on, how can others? Don’t balk at the criticism that might come your way. Be graceful in admitting where you went wrong. If you want to grow, you will and must take on additional responsibilities. If you don’t, you are making sure that your old set of tasks remains by your sight all your life. Even if you are not handed over higher responsibilities right away your keenness cannot go unnoticed.
Deepak MalhotraVice President - Human Resources
IL&FS Environmental Infrastructure Services Ltd.
reach him at deepak.malhotra@ilfsenv.com