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5 Performance appraisal methods that actually work

5 Performance appraisal methods that actually work

In this article, you’ll learn modern strategies for reviewing employee performance, enabling your organization to develop a comprehensive understanding of your workforce.

Implementing a well-executed employee appraisal strategy into your management program may seem intimidating. However, if the process is properly managed, you will reap tangible rewards later on.

In this article, you’ll learn modern strategies for reviewing employee performance, enabling your organization to develop a comprehensive understanding of your workforce.

What is Performance Appraisal?

Performance appraisals are often performed on an annual or quarterly basis. Depending on your organization’s targets, budget, size, and resources. Without performance appraisal, employees are left disengaged and unmotivated, resulting in reduced productivity. A recent Gallup study reported that:  


“Only 2 in 10 employees strongly agree that their performance is managed in a way that motivates them to do outstanding work.”


Older performance appraisal techniques were rarely successful because they focused exclusively on past performance. However, modern methods have become extremely effective in:


  • Offering insights into future training needs
  • Enhancing employee productivity
  • Retaining and developing existing employees
  • Correlating business goals with employee performance
  • Uniting the workforce with a company vision

Effective Appraisal Methods

Successful performance management can be broken down into a 3-step process: development, management, and review. To increase your chances of an effective appraisal it is important to pay close attention to each stage. The key is always in good planning.

It is the duty of the manager/assessor to always provide clear and objective feedback. This feedback should always be very specific and be supported by tangible evidence. An employee is more likely to respond to criticism when they fully understand what they’re being asked to improve.

Once the assessment period has ended, and the data has been gathered, this information can be used as an indication of the necessary behavior and work habit changes. It can also provide managers with intel for providing employees with future compensation and rewards.

Behaviorally Anchored Rating Scale (BARS)

Commonly referred to as one of the more ‘well-rounded’ appraisal methods, the BARS system will deliver you with both qualitative and quantitative results. Here, predefined behavioral statements are coupled with a rating scale. This is a major difference from a standard rating scale which has been linked to a predefined question. It enables an assessor to establish a higher degree of accuracy, relative to performance.

Pros

  • Outlines expected employee behavior relative to circumstance
  • Reduced chance of bias or subjective results
  • Creates a clear standard for performance across multiple instances
  • Applicable to every department of the companies workforce, from interns to executives

Cons

  • Time-consuming and labor-intensive
  • Doesn’t offer clear insights into promotional decisions
  • Depending on behavioral statements, reviewing could become subjective

Management by Objective (MBO)

With this strategy, managers, subordinates, and employees come together to set a period and discuss specific predefined goals. Once the period has ended, assessors will judge the performance against the objectives. It’s important that these expectations are clear and offer tangible, measurable results. One way to ensure this is by using the SMART criteria:


  • Specific
  • Measurable 
  • Achievable
  • Relevant
  • Time-based


Your employees should understand the reason for the assessment and how they are being reviewed. It's important that these objectives are within the employee’s control. The recent Gallup study also found that:  


“Only 21% of employees strongly agree they have performance metrics that are within their control.”

Pros

  • Delivers clear data on measurable results
  • Encourages employees to reach for set targets
  • Promotes synergy between departments
  • Increases chances of completing goals

Cons

  • Limited integration with top management
  • Minimal consideration for inter-personal skills and commitment

360-Degree Feedback

If you’re looking for an appraisal method with an emphasis on self-assessment, you must consider 360-degree feedback. Here, the performance review will incorporate feedback from a variety of channels. Some examples of these channels are:

Self-Appraisal

Encouraging an employee to conduct an assessment helps them to be more connected with performance and results. It also allows the manager to be more empathic and see the employees as individuals. This is a common difficulty, especially in larger organizations.

Managerial Reviews

These reviews are often responsible for rating and assessing individual performance, as well as teams and programs. 

Peer Reviews

Involving peers within the review process can be a fantastic way to quickly broaden your assessment across a large team. As a peer assesses a colleague’s performance, they are simultaneously analyzing their role and how they are working. 

Subordinates Appraising Manager (SAM)

The appraising manager is a fundamental contributor to the process. They have significant responsibility and often feel great pressure in analyzing and quantifying results.

Customer or Client Reviews

A unique channel of feedback, customers, and clients offer a different perspective on employee performance. This perspective can place a higher value on less tangible data such as attentiveness, empathy, or courtesy.

Pros

  • Provides a broad level of feedback from multiple channels
  • A catalyst for strategizing development programs
  • Encourages employees to assess self-performance

Cons

  • Animosity or destain can skew peer reviews
  • Feedback can be easily misinterpreted
  • Inconsistent metrics for evaluation

Graphic Rating Scale

If you’re just starting and struggling to decide where to start with your assessment strategy, this could be a great place to start. The Graphic Rating Scale is a simpler, more user-friendly strategy.


The process will start by determining a set of role-specific characteristics and applying these to a table. Each employee will then be ranked for each of these traits. The results enable you to segment your workforce into different trait-specific categories, helping you to decide who is most likely to succeed at a given task. 

Pros

  • A great place to start for assessing your overall workforce environment
  • Can provide valuable data for subsequent appraisals
  • Easy to use system

Cons

  • Vulnerable to overly critical and highly subjective assessment
  • Is not goal-orientated
  • Assessment results could be affected by external factors

AhoyTeam for Appraisal Methods

As more offices become remote, managing your team’s performance can seem like a challenge. How can you accurately monitor the output of your workforce when you can’t look over their shoulder? 

At AhoyTeam, we generate customized, automated workflows for your business. These workflows can be department specific, giving you the power to put multiple repeatable tasks on auto-pilot. This saves you countless hours which can now be invested in more important tasks, like conducting employee appraisal. Improve the efficiency of your team, and you’ll see substantial financial rewards.





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