Methods of Performance Appraisal

A professional writer and passionate blogger, Sampurna has been lending her expertise to the online world by penning articles, guest posts and blogs on career, business and employment for a quite some time now. She also an avid reader; loves travelling and photography.

The area of performance management is of enormous interest, particularly at a personal level. However, these days it has gained immense prominence as a topic of discussion among corporates worldwide that are all set to initiate big and small changes to the way they approach the measurement and management of performance review. Over the last four decades, we have seen the outlook towards methods of performance appraisal come a full circle.

From the early methods of qualitative evaluation of some reports set up confidentially or some being erstwhile, organizations – globally as well as in India have now embraced greater objectivity—that of quantification and relative ranking.

Together with this, came the approach towards compulsory distribution, which was esteemed and despised in equal measure. From early 2014 onwards, an interesting trend has been observed among global organizations, especially in the consulting and technology space to make their overall performance management approach more development-focused and less dependent on the age-old practice of relative ranking and somewhat generalization.

This has also encouraged their Indian counterparts to evaluate their current performance processes and make modifications critically.

However, now the days of the annual review or the traditional methods of performance appraisal seem to be numbered. Some companies, including leading ones like Deloitte and Accenture, even announced plans to drop it. Here’s what Deloitte asked its managers to take into consideration – four questions and their response to it:

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1. Keeping in mind, this particular employee’s performance, if I had the power and the money, I would have awarded him with the best possible hike in compensation as well as an excellent bonus component.

2. I am well aware of this individual’s performance and keeping that in mind, I would want him or her to be on my team.

3. This employee’s performance needs to be evaluated as he is at a low-performance risk.

4. This particular employee is ready for promotion.

However, Deloitte’s approach might not be the best one as there are many other aspects involved in the methods of performance appraisal. Several companies are working on technology that ends up assessing employee performance not once in a year but on a regular basis. Other companies are using social media to enable workers to rate each other, and some are now even resorting to Big Data for the same.

Is Big Data the New Face of Performance Review?

Well, several companies are resorting to Big Data to answer or transform their methods of performance appraisal. Various systems of surveillance that have been tracking employee performance have been a familiar feature of the corporate life for years now; however, the boss’s eye did have a plenty of blind spots. But, now that has begun to change considerably as a new generation of technology is tracking employees’ whereabouts.

Let’s observe an example here, that of Hitachi.

Hitachi, the Japanese electronics giant, implemented a unique technology named Business Microscope sensors that would be instrumental in measuring employee whereabouts: wearable sensors will make it possible to record the energy level in the voice of an employee and even how often she makes movements and gestures.

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Recently, Hitachi used the Business Microscope sensors to collect a whopping 5 billion points of data observing the physical movement of around 468 employees working in seven companies. They used this to identify “distinctive patterns in physical movements that have high correlations with a group’s happiness,” according to a press release from February 2015. After analyzing the data, scientists found an existing correlation between great happiness and extended duration of physical movements but also between happiness as well as sales productivity.

However, the primary goal behind Hitachi’s implementation of microscope sensor was to apply the same as a problem-solving tool rather than any surveillance on employees. The primary purpose of Hitachi’s Big Data or Cloud Services implementation was to, quantitatively and efficiently evaluate the efficacy of the organizational policies and work environment in a company, where it had been challenging to accomplish such unprejudiced evaluations in the past.

Social Media Comes to the Rescue

While big companies like Hitachi are strategically implementing Big Data in their innovative methods of performance appraisal, on the other hand, some companies are using social media to rate employees in the same way as e-commerce sites Airbnb is doing it. Experts opine that social evaluation provides a positive opportunity to reward those who are helpful, supportive and collaborative in the workplace. Moreover, in the social evaluation system, people who have the capacity to steal ideas and achieve results through aggression are more likely to be identified and get that behavior addressed.

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However, implementing social media among the various methods of performance appraisal does have its own set of shortcomings, as humans are not always good at making people decisions. In addition to that, social evaluation can have its vulnerabilities in a way that an employee might feel somewhat ganged-up by the whole office. Nonetheless, if used in conjunction with other methods of performance appraisal, social evaluation can turn out to be useful for performance management.

Despite all the hullaballoo, sounding off the whistles and the bells, traditionalists still stick to their thought process that performance appraisals will continue to remain on the lines of honest and sometimes difficult conversations.

Whatever that might imply, on a final note it can be said, whether it is an implementation of Big Data or Social evaluation – the concept of performance management is all set to undergo some massive changes in the coming times.

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