Herding employees to maximise value creation (2)

So, do you dread your performance appraisal? Should we disdain what should be the culmination of a process that recognises one’s hard work, the areas they excelled in and those that require improvement? The question we should all ask and answer is: why do some people not welcome their performance appraisal? After all, the appraisal process drives the mechanics of value creation at the company. It fixes whatever is not right and augments what is going well. In effect, it’s the engine of value creation at the company.

Yet many of you remind us all the time that the above is the ideal, but the script that we see at firms big and small is much different

The place to be after your evaluation

Well, for those affected and interested companies, below and courtesy of the Open Learning World, we elaborate the fixes needed to deliver a viable individual performance evaluation system and with it, signature value creation from the leadership, strategy, and design OV’s.

Implement the fixes at your company, and the result is an appropriate employee T.L.C regime, right organisational climate, brand affection and ultimately an effective organisation that creates signature value for the owners

The polity of employee performance management

The Open Learning World resource recommends eight (8) elements that are needed to certify an individual performance appraisal as good.

  • Reliability and validity
    Specific key variables are required for an appraisal to be certified as reliable and valid: consistent, reliable, valid information and data that the organisation can rely on in court in case of a legal dispute and the employee under evaluation can attest to. Also, evaluation techniques should satisfy the condition of inter-rater reliability, i.e. where two evaluators, using the same technique, agree with each other. Good evaluations also satisfy the validity condition – measuring what they are supposed to measure.
  • Job relatedness
    The two documents that are usually the focus of evaluation are the employee’s job description and the agreed individual high-level or stretch goals. The performance evaluation process needs to measure the employee’s competencies in the agreed job-related areas and clearly articulate the outcomes of their effort towards the agreed job-related areas
  • Standardization
    This is indeed a no-brainer. Appraisals are systemic in nature and are ultimately linked to the organisation’s goals. Appraisal tools, therefore, as well as rating determination, should be standardised Not many institutions take seriously the sensitivity relating to appraisal process rubrics and how they impact value creation at the organisation.
  • Practical viability
    Of course, organisations should avoid having a PhD thesis for their performance appraisal manual. If the appraisal manual is too complicated, senior managers will cherry-pick, and it’s only natural that they will go for the easy bits, avoiding critical value creation levers
  • Legal sanction
    Yes, appraisals ought to satisfy labour law requirements. Have your appraisal tools checked by a competent labour law lawyer
  • Training to appraisers
    The sheer importance of assessments to people’s careers, personality, weak-points identification and mapping, and the whole gambit of T.L.C for staff, calls for very a very careful and well-calibrated process of engagement. The process doesn’t have to be too soft or hard. It’s a delicate balancing act that calls for particular skills set by the appraiser. Organizations may consider providing some kind of training to appraisers
  • Open communication
    ‘Most employees want to know how well they are performing the job. A good appraisal system provides the needed feedback on a continuing basis. The appraisal interviews should permit both parties to learn about the gaps and prepare themselves for future. To this end, managers should clearly explain their performance expectations to their subordinates in advance of the appraisals period. Once this is known, it becomes easy for employees to learn about the yardsticks and, if possible, try to improve their performance in future.’
  • Employee access to results
    Transparency is needed in any employee evaluation processes. Results of evaluations should be shared and a rebuttal allowed for the employee. Follow on discussion should be held to resolve any areas of disagreement. In many instances, it’s a matter of clarification of the facts. In a few cases, it’s accepting fault on the side of the evaluator and corrections being made. The latter rebuilds trust and like we have written already sustains organisational value creation in the long-term

So what?

Well, as we concluded this sequel on individual performance evaluation at the SMART organisation, we are obliged to highlight yet again, the interconnectedness at the bionic entity and how dysfunction in one OV negatively impacts value creation by the other OV’s, in this case, Leadership, Strategy, and Design.

The SMART organisation value chain is so interconnected that leaders have to take cognisance of the fact that not paying attention to the whole OV bionics stratagem undermines value creation. For example, a staff’s performance evaluation can’t create signature value if: it’s not linked to the organisation’s strategy, the performance goals aren’t established in the context and limitations of the organisation’s current design, etc.

The parting shot from Synergita: ‘Performance appraisal should be used primarily to develop employees as valuable resources. Only then it would show promising results. When management uses it as a whip or fails to understand its limitations, it fails. The key is not which form or which method is used (Mathis and Jackson).’

The bionic entity is an exciting and welcome OD. hodgepodge for those of you that are keen to build sustainable smart organisations. We hope that you will choose and build the right jigsaw puzzle for your company’s performance evaluation paradigm

Next stop: Dealing with difficult colleagues – the manager’s nightmare

A very happy and prosperous 2018!

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Categories: People

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