HOW TO MEASURE EMPLOYEE PERFORMANCE

The most difficult part of the performance appraisal process is to accurately and objectivelymeasure the employee performance. Measuring the performance covers the evaluation of the main tasks completed and the accomplishments of the employee in a given time period in comparison with the goals set at the beginning of the period. Measuring also encompasses the quality of the accomplishments, the compliance with the desired standards, the costs involved and the time taken in achieving the results. Measuring employee performance is the basis of the Performance appraisal processes and performance management. Accurate and efficient performance measurement not only forms the basis of an accurate performance review but also gives way to judging and measuring employee potential. For the purpose of measuring employee performance, different input forms can be used for taking the feedback from the various sources like the superior, peers, customers, vendors and the employee himself. All the perspectives thus received should be combined in the appropriate manner and to get an overall, complete view of the employees performance. Observation can also be exercised by the superior to obtain information. Some suggestions and tips for measuring employee performance are:

Clearly define and develop the employee plans of action (performance) with their role, duties and responsibilities. Organizational outcomes or the achievement of organizational goals should also be kept in mind. Focus on accomplishments and results rather than on activities. Also take note of the skills, knowledge and competencies and behaviors of the employees that help the organisation to achieve its goals. If possible, collect the feedback about the performance of the employees through multi-point feedback and self-assessments. Financial measures like the return on investment, the market share, the profit generated by the performance of the team should also be considered.

For an organisation to be an effective organisation and to achieve its goals, it is very important to monitor or measure its and its employee performance on a regular basis. Effective monitoring and measuring also includes providing timely feedback and reviewsto employees for their work and performance according to the pre-determined goals and standards and solving the problems faced. Timely recognition of the accomplishments also motivates the employees and help to improve the performance.

Measuring the performance of the employees based only on one or some factors can provide with inaccurate results and leave a bad impression on the employees as well as the organisation. For example: By measuring only the activities in employees performance, an organization might rate most of its employees as outstanding, even when the organisation as a whole might have failed to meet its goals and objectives. Therefore, a balanced set of measures (commonly known as balanced scorecard) should be used for measuring the performance of the employee.

Once a Year Overview Self Appraisal Performance Review - Preparation Performance Review - The Meeting How to Complete a Performance Appraisal Form Analysis for Improving Performance Active performance appraisal conversation Performance appraisal feedback Performance Consulting: Moving Beyond Training Writing performance appraisal Performance Appraisal Training How to Measure Employee Performance FAQ about Performance Appraisal

Self appraisal is an important part of the Performance appraisal process where the employee himself gives the feedback or his views and points regarding his performance. Usually this is done with the help of a self appraisal form where the employee rates himself on various parameters, tells about his training needs, if any, talks about his accomplishments, strengths, weaknesses, problems faced etc. TIPS FOR SELF APPRAISAL Be honest Always be truthful and honest while telling your accomplishments or failures. Dont exaggerate your strengths and dont hide your weaknesses. Dont make personal judgments for anybody. Do the preparation Its always better to prepare yourself before the meeting. Get all the lists in place, prepare all the evidences and references.

Be objective Objectivity is important in self appraisal. Dont exaggerate or downplay your achievements or failures. Be specific and concise in your statements and if possible

support them with examples or references or evidences with dates. For example: "I responded to all queries within 48 hours" is better than just saying "My customer service was good." Positive attitude Have a positive attitude towards the whole appraisal process. Be co-operative. Dont hesitate from taking the responsibility of your failures as well as the achievements. Demonstrate enthusiasm to improve in future and take all his suggestions calmly. Dont complain or demonstrate a negative attitude. Cover all the aspects Apart from your strengths, weaknesses, accomplishments and failures, express the opportunities you would like have for your development and improvement. Suggest ways to overcome the problems faced. Assess your capabilities, behaviours and skills and competence. Seek future responsibilities According to the assessment of the KSAs according to your job description, plan the short term and long term for the next year. Try to look for tasks beyond your current job responsibilities. This will help in personal development as well as contributing to the organizational productivity. Self appraisal should ideally include the accomplishments, the goals achieved, the failures, and the personal growth (i.e. new skills acquired, preparation for the future etc.), the obstacles faced during the period, the efforts for removing them, the suggestions, and the areas of training and development felt by the employee.

Preparation for Performance Review The performance review meeting should not be strictly formal nor should it be completely informal in nature. Ideally, the review meeting should be structured, semi formal meeting which needs prior preparation by the appraiser as well as the employee for it to be effective. Following are some points that need to be prepared before the review meeting of Performance appraisal:

Inform the concerned employees the date, time and place for the review meeting well in advance. Review and be prepared with each and every employees Job description o Performance standards o Planned performance goals o Performance measures collected throughout the time period o The critical incidents details o Past appraisals of the employees. Be ready with all the important dates Give the employee a copy of the appraisal form The appraiser needs to completely understand the standards for the employees at same level to maintain the consistency in the process. Prepare what to say and how to say it calmly. The feedback should be prepared in quantifiable measures where ever possible. The appraiser should be familiar with the performance review form and the details The employee and the appraiser both should be prepared to discuss and figure out the future goals and training needs They should be mentally prepared for constructive feedback
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Collect as many evidences to support your point as possible like the monthly, quarterly progress reports.

Analysis for Improving Performance Any performance review process is incomplete without the feedback to the employees. The feedback could be given in the review discussion. Review discussions are semi formal, scheduled, periodic interactions usually bimonthly or quarterly between a manager and his employee. The basic purpose of the review discussion is to analyze the performance of the employee in the past to improve the performance of the employee in future.

A review discussion is an opportunity to coach, mentor, learn and understand. The manager encourages his/her employees to critically reflect over progress made on thePerformance appraisal plan and to develop creative, yet feasible alternatives for problem areas. The manager uses this opportunity to:

Review the performance of the each employee individually. Discuss the problems faced by the employees during the course of action. The solutions tried, and the degree of success achieved in solving the problems faced. Revisit with the employee, his/ her annual plan for the remaining time period and develop revised action plans, if necessary.

Review discussions reassure the employees that each one of them has structured opportunities for one to one interaction with the manager once every two or three months during the year. These opportunities are important as they provide an important chance for performance monitoring or development mentoring. The aim of the performance review discussions is to share perceptions, solve the problem faced during the course of the action, decide on the new goals jointly and provide a feedback to the employee for the past performance i.e. to look at his strengths and weaknesses and also help to chart out a career plan for the employee. The focus of these performance review discussions should not bet o judge the employees past performance; rather it should be to motivate the employee to improve his future performance and reinforce his good behaviour.

Performance Appraisal Feedback Performance appraisal process is incomplete without the feedback given to the employee about his appraisal and his performance. But the way of giving as well as receiving the feedback differs from person to person and their way of handling and their outlook towards the issue. According to a popular saying:

"A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION WITH THE BRICKS OTHERS HAVE THROWN AT HIM." Therefore, On the part of the person receiving the feedback, the following points are important to be taken care of:
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The employee should have a positive attitude towards the feedback process He should listen to the suggestions of the appraiser calmly and try to incorporate them in his plans. He should not hesitate to ask for the help of his superiors. Should have a co-operative attitude during the feedback meeting. Dont judge the appraiser as a person. Should take the feedback objectively. Should not judge the appraiser as a person on the basis of the feedback.

On the part of the appraiser or the manager / person giving the feedback, the following points are to be taken care of:
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The appraiser should make the receiver feel comfortable during the feedback meeting. The appraiser should make it a two way conversation i.e. let the employee speak. Listen to the employee and note his points, suggestions, problems etc. The appraiser should not adopt a confrontational approach towards the meeting. The goal is not to criticize the employee. Provide a constructive feedback to the employee i.e. in a way which will motivate him to perform better. Have a positive attitude towards the process Try to understand the reasons of his failure. Be fair and objective Prepare yourself for what to say and how to say. Make the appraisal feedback meeting useful and productive for the organization and the employee.

Process of Performance Appraisal

ESTABLISHING PERFORMANCE STANDARDS The first step in the process of performance appraisal is the setting up of the standards which will be used to as the base to compare the actual performance of the employees. This step requires setting the criteria to judge the performance of the employees as successful or unsuccessful and the degrees of their contribution to the organizational goals and objectives. The standards set should be clear, easily understandable and in measurable terms. In case the performance of the employee cannot be measured, great care should be taken to describe the standards. COMMUNICATING THE STANDARDS Once set, it is the responsibility of the management to communicate the standards to all the employees of the organization. The employees should be informed and the standards should be clearly explained to the. This will help them to understand their roles and to know what exactly is expected from them. The standards should also be communicated to the appraisers or the evaluators and if required, the standards can also be modified at this stage itself according to the relevant feedback from the employees or the evaluators.

Challenges Of Performance Appraisal

An organization comes across various problems and challenges Of Performance Appraisal in order to make a performance appraisal system effective and successful. The main Performance Appraisal

challenges involved in theperformance appraisal process are: Determining the evaluation criteria Identification of the appraisal criteria is one of the biggest problems faced by the top management. The performance data to be considered for evaluation should be carefully selected. For the purpose of evaluation, the criteria selected should be in quantifiable or measurable terms Create a rating instrument The purpose of the Performance appraisal process is to judge the performance of the employees rather than the employee. The focus of the system should be on the development of the employees of the organization. Lack of competence Top management should choose the raters or the evaluators carefully. They should have the required expertise and the knowledge to decide the criteria accurately. They should have the experience and the necessary training to carry out the appraisal process objectively. Errors in rating and evaluation Many errors based on the personal bias like stereotyping, halo effect (i.e. one trait influencing the evaluators rating for all other traits) etc. may creep in the appraisal process. Therefore the rater should exercise objectivity and fairness in evaluating and rating the performance of the employees. Resistance The appraisal process may face resistance from the employees and the trade unions for the fear of negative ratings. Therefore, the employees should be communicated and clearly explained the purpose as well the process of appraisal. The standards should be clearly communicated and every employee should be made aware that what exactly is expected from him/her.

Approaches to Performance Development

Performance appraisal - Traditional approach Traditionally, performance appraisal has been used as just a method for determining and justifying the salaries of the employees. Than it began to be used a tool for determining rewards (a rise in the pay) and punishments (a cut in the pay) for the past performance of the employees. This approach was a past oriented approach which focused only on the past performance of the employees i.e. during a past specified period of time. This approach did not consider the developmental aspects of the employee performance i.e. his training and development needs or career developmental possibilities. The primary concern of the traditional approach is to judge the performance of the organization as a whole by the past performances of its employees Therefore, this approach is also called as the overall approach. In 1950s theperformance appraisal was recognized as a complete system in itself and the Modern Approach to performance appraisal was developed. Performance appraisal - Modern approach The modern approach to performance development has made the performance appraisal process more formal and structured. Now, the performance appraisal is taken as a tool to identify better performing employees from others, employees training needs, career development paths, rewards and bonuses and their promotions to the next levels. Appraisals have become a continuous and periodic activity in the organizations. The results of performance appraisals are used to take various other HR decisions like promotions, demotions, transfers, training and development, reward outcomes. The modern approach to performance appraisals includes a feedback process that helps to strengthen the relationships between superiors and subordinates and improve communication throughout the organization.

The modern approach to Performance appraisal is a future oriented approach and is developmental in nature. This recognizes employees as individuals and focuses on their development.

MEASURING THE ACTUAL PERFORMANCE The most difficult part of the Performance appraisal process is measuring the actual

performance of the employees that is the work done by the employees during the specified period of time. It is a continuous process which involves monitoring the performance throughout the year. This stage requires the careful selection of the appropriate techniques of measurement, taking care that personal bias does not affect the outcome of the process and providing assistance rather than interfering in an employees work. COMPARING THE ACTUAL WITH THE DESIRED PERFORMANCE The actual performance is compared with the desired or the standard performance. The comparison tells the deviations in the performance of the employees from the standards set. The result can show the actual performance being more than the desired performance or, the actual performance being less than the desired performance depicting a negative deviation in the organizational performance. It includes recalling, evaluating and analysis of data related to the employees performance. DISCUSSING RESULTS The result of the appraisal is communicated and discussed with the employees on oneto-one basis. The focus of this discussion is on communication and listening. The results, the problems and the possible solutions are discussed with the aim of problem solving and reaching consensus. The feedback should be given with a positive attitude as this can have an effect on the employees future performance. The purpose of the meeting should be to solve the problems faced and motivate the employees to perform better. DECISION MAKING The last step of the process is to take decisions which can be taken either to improve the performance of the employees, take the required corrective actions, or the related HR decisions like rewards, promotions, demotions, transfers etc.