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The Future of Performance Appraisals: 6 Innovations and Changes [Quick Guide]

The performance appraisal is a crucial aspect of performance management, businesses are proactively seeking ways to maximize their performance. Traditionally the performance appraisal is a once in a year exercise associated with a lot of paper work, yearly meetings, and little bit of frustration. Both the managers and employees felt the pressure during the appraisal process. However, things have changed rapidly, businesses have started adopting more modern and advanced performance appraisals systems to boost the performance and employee engagements. Since past decade we have witnessed a wide-scale adoption of modern performance appraisal methods and systems all around the world.

Businesses in UAE are also rapidly adopting to modern performance management trends. In this blog we will discuss how a modern performance management system can greatly elevate your performance management process. The modern software-based performance management systems digitalize the process, offer advanced data collection tools, and boost employee engagements and satisfaction. The modern workforce have different priorities and require a completely different performance management approach. This is why the traditional annual reviews and performance appraisal systems are failing, compelling businesses to embrace the innovation and automation.

The Future of Performance Appraisals Innovations and Changes
The Future of Performance Appraisals Innovations and Changes

The Evolution of the Performance Appraisal System

The traditional performance appraisal system focuses on annual reviews majorly focused on hierarchal feedbacks, which proven to be ineffective for the modern workforce. The major reasons of its failure are the revolutionary change in the workforce behavior alongside rapid and sudden changes in the business landscape. Businesses started realizing that they need a more frequent and continuous performance assessment framework which is very responsive and it aligns with the modern workforce mindset. Now a days businesses are more focused on continuous feedback and real-time assessments which led to real-time development and improvements.

See Also: Why Organizations need Performance Appraisal System in UAE

Moreover the one-size-fits-all approach also faded away, as businesses have realized that this method is no longer fruitful. Instead of that businesses started adopting personalized and robust assessment methodologies that are flexible and harmonious with individual employee needs and goals. Instead of appraisals being an annual event the modern performance appraisal system offers a bi-weekly or monthly assessments and a continuous feedback framework which keeps employee engaged and promote a highly collaborative and highly efficiency development system. The regular check-ins are a great way to discuss ongoing progress, give constructive feedback and align employees with organizational goals and objectives.

The Evolution of the Performance Appraisal System
The Evolution of the Performance Appraisal System

1. The Blend of Modern Strategies and Technology

The technology is the backbone of the modern performance appraisal system, it completely revamped the entire process making it more efficiency and effective. A technology infused performance appraisal system is built around a performance appraisal software or performance management software (PMS). From integration of AI (artificial intelligence) and smart analytical algorithms to advanced real-time data collection tools, businesses are embracing the power of technology to elevate performance appraisal process which ensures highest levels of efficiency and accuracy. The modern performance appraisal systems offer intuitive online platform where the both managers and employees can access to the relevant performance data in real-time enabling them to take actions, when and wherever needed.

See Also: Characteristics of a Good Employee Appraisal System

These tools can greatly enhance the efficiency and eliminate the tedious paperwork from the process. Businesses can not only automate several administrative tasks but they can also get real-time updated data to understand various employee performance trends and deeper insight. This insight helps them identifying the area of improvements and taking timely actions to keep everyone on track towards achieving high-level organizational goals and objectives. Furthermore the modern performance appraisal system software are super-accessible, employees and managers both can access the system from online or even via their mobile phones. The self-assessment tools, advanced skill development modules and accurate KPIs can significantly improve the accuracy, efficiency and impact of the system.

The Blend of Modern Strategies and Technology
The Blend of Modern Strategies and Technology

2. Shift towards Continuous Feedback and Focus on Employee Alignment

The traditional performance appraisal system lacks two major and most crucial factors, one is frequency of the feedbacks, in fact it only has once a year feedback and assessment system and the other most important aspect is the inefficient and ineffective approach towards employee alignment with their individual goals and in long term towards the high level organizational goals and objectives. The traditional annual reviews and feedbacks are prone to develop a gap and disconnect between the employees and the managers which results in delays in feedbacks and actions. Once a year feedback couldn’t course correct and align employees with their goals, however, the course correction and addressing to performance hindering issues is required in real-time.

See Also: How to Develop Custom Performance Appraisal System in UAE?

The bloodline of performance management and main objective of appraisal process is to align individual employee’s goals with high-level organizational strategic objectives. The annual appraisal reviews and feedback lacks this connection which results in disengagement of employees from the high-level strategic goals and objectives. This requires intense communication and a strong bond between the managers and the employees. A modern performance management system promotes communication, continuous feedback and give ownership to employees boosting engagements and cultivating a culture of collaboration, communication and collective growth. The modern performance appraisal system ensures every employees clearly understand their goals, success parameters, and how their goals and work will contributes to the higher-level organizational goals and strategic objectives.

Shift towards Continuous Feedback and Focus on Employee Alignment
Shift towards Continuous Feedback and Focus on Employee Alignment

3. Shift from Fixing the Weakness towards Focusing on Strength and Development

The primary focus of the modern day performance appraisal system is not focusing only on the past performance but it also has to be a catalyst for the growth, development and improvements in the future. Now a day’s businesses are more focused on employee development and retention. This help businesses gradually grow their workforce and skillset to build strength which drive performance and efficiency. Another most important and impactful advantage of the resent day employee appraisal system is to give ownership to the employees and empower them to shape their development journey. This system gives employee power, resources, support and tools to build strength, identify their weaknesses and focus on learning and continuous development.

See Also: Modern Methods of Performance Appraisal

Businesses need to build and retain a skillful workforce that can improve operational efficiency and help businesses achieve their goals and drive long-term sustainable success. The managers can leverage the inbuilt advanced tools to identify the strengths and weaknesses of the individual employees with contextual performance insights. This insight is crucial in further enhancing the employee’s skills to make them more productive and fruitful for the organization. This also help businesses and HR leaders to take informed investment decisions in development programs which help businesses build a resilient workforce which ensures high-quality products/services and satisfactory customer experience.

Shift from Fixing the Weakness towards Focusing on Strength and Development
Shift from Fixing the Weakness towards Focusing on Strength and Development

4. Flexibility and Data-Driven Insights

In today’s modern market landscape businesses have to be very vigilant and proactive towards the rapid market changes emerging needs. This demand agile performance appraisal and data collection system which is flexible enough to enable businesses to make instant adjustments. This helps businesses align with the emerging needs and help them to be more responsive towards rapidly changing market trends. This is only possible when the business leaders and managers have highly accurate performance data and critical insights which help management identify trends, correlations and patterns which help making more accurate and informed strategic decision to improve the performance.

See Also: 5 Challenges to face if Performance Appraisal is not customized as per Organization’s Policies

Furthermore the performance appraisal system is a software based solution which enable businesses to customize their performance management system to accommodate their unique business needs and to deal with unique challenges they face. The ability to customize the performance parameters, goals, KPIs, and even the entire framework help management proactively take actions to respond to the rapidly evolving trends, customer demands, and needs. This also prepare businesses to deal with unprecedented and unexpected situation while minimizing or eliminating the disruptions. Whether it is adjusting to the goals, assessment criteria, feedback and review process or integration of the new technologies, the inherent flexibility and customization of the performance appraisal system helps businesses deal with challenges with no or minimum disruption in progress.

Flexibility and Data-Driven Insights
Flexibility and Data-Driven Insights

5. Performance Beyond Numbers – Accountability with Transparency

Traditionally the performance appraisal was focused on KPIs and achievements, lacking contextual analysis and behavioral competencies. However, the modern performance appraisal system is measuring performance beyond numbers, and recognizing the importance of accountability with highest transparency. Businesses have realized that achieving goals is important but there are several other personality traits and qualities which also plays a crucial role in overall performance as well as fostering a high-performing and engaging organizational culture. Here are a few most important qualities:

  • Teamwork and Collaboration: Today’s work environment demand higher collaboration and teamwork in order to effectively achieve the strategic objectives.
  • Adoptability: Today’s market landscape is driven by technology and the technology evolves rapidly furthermore the customer demands and market trends are also subjected to change quickly, therefore it is crucial for an employee to be able to adopt to emerging changes.
  • Ethics and Responsibility: A modern day employees should have to be ethically strong and they should exhibit exceptional ability to take ownership, responsibility and initiatives. This will make them a valuable asset for the organization.
  • Creativity and Innovation: Businesses are always facing challenges either with emerging needs, or rapid advancement in the industry, therefore an employee with higher level of problem solving skills and a creative and innovative mindset to bring new ideas to the table.

See Also: How to Design a Modern Performance Management System?

The KPIs, OKRs, and the evaluation based on above qualities and other such qualities will help businesses and organizations to build a performance appraisal framework which can precisely evaluate the true potential and abilities of an employee.

The accountability and transparency is the soul of an employee performance appraisal system. This is also one of the biggest reason why business leaders and organizations are adopting to modern performance appraisal system and methodologies. The traditional performance appraisal system lacks transparency and is prone to biased evaluation furthermore the insufficient performance data also hinder the transparency and cause lack of trust on the system. The employees are more concerned about transparency, fair evaluation, clear evaluation criteria, performance expectations and clarity in goal and objectives. This is only possible with modern performance appraisal system, continuous feedback, 360 degree feedbacks, customizable performance dashboards, and various other advanced analytical and data collection tools to promote fair accountability and transparency in the system.

See Also: The Role of Performance Management in Employee Engagement

Performance Beyond Numbers – Accountability with Transparency
Performance Beyond Numbers – Accountability with Transparency

6. More Focus on Reward and Recognition

The employee motivation is one of the most crucial factor contributing to the entire performance of the organization. If the employees are rewarded for their performance and their achievements are adequately recognized and well-appreciated, they tend to perform better. A regular annual raise or bonuses are not enough, businesses are finding more creative ways to reward and recognize their employees such as:

  • Public Recognition: Public recognition is one of the best way adopted by modern organizations to appreciate their employees. When employees are appreciated publicly either in marketing, social media, newsletter or internal meetings, it will not only boost their morale but it will also result in inspiring and motivating others.
  • Development Opportunities: The learning and development opportunities are a great way to raise employee retention and to boost employee skills which eventually contributes to improving performance. Employees who doesn’t found enough learning and development opportunities they feel their growth is limited and are tend to leave the organization.
  • Fair Reward Process: Fairness in the reward process is crucial, the employee who is rewarded must know on what criteria he or she is rewarded and the other employees must also know what he or she did exceptionally which make them eligible for this particular reward. The fairness and transparency is crucial for keeping everyone’s morale high.

See Also: What are the Features of a Best Performance Management System?

The fair and transparent reward and recognition program can greatly benefit both employees and the business by fostering a culture of appreciation and encouragement. Furthermore the modern employee performance appraisal system provides a systematic framework for communication which helps employees understanding their goals, business’s expectations, performance criteria and it is also very helpful in strengthening the relationship between the managers and employees which itself is a great way to increase employee engagements and boost the organizational performance.

More Focus on Reward and Recognition
More Focus on Reward and Recognition

Conclusion

Traditionally the employee performance appraisal process comes with a lot of paperwork, efforts, and some frustration as well. Furthermore the traditional performance appraisal system also fell short of meeting the modern need of performance management and the accuracy of the process is also questionable. Therefore businesses are now adopting to modern performance management and appraisal practices alongside software aided solutions. The modern performance appraisal system comes with a comprehensive software application which not only digitalize the process but also help automating it and offer many additional benefits which enable businesses to conduct more frequent evaluations, even project-based evaluation and bi-weekly assessments are also effectively done through it.

The modern performance appraisal system offer continuous feedback loop, communication framework, goals and objective setting facility, highly accurate KPIs monitoring tools, real-time performance data collection, personalized assessment methodologies, and specialized tools to focus on reward and recognition while boosting transparency, accuracy and efficiency. Furthermore the modern performance appraisal system also focus on higher employee alignment with organizational goals and strategic objectives. This helps businesses achieve their long-term goals and sustainable success.

Furthermore the modern performance appraisal system also focus on fostering highly collaborative organizational culture which not only boost communication but also help businesses keep employees more engaged and proactive. Businesses also want to achieve higher employee retention which is only possible when the organizations are able to identify the areas of improvements, employee problems, their needs and expectations. In this blog we have discussed how the future of performance appraisal will look like in the coming years. If you want to learn more about the subject or if you want our help to design and deploy a modern and customized employee performance appraisal system exclusively designed to meet your unique business need, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

See Also: How Performance Management Impact on Organization’s Culture?

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The Role of Performance Management in Employee Engagement

In a modern competitive market landscape it is crucial that a business fully leverage the true potential of its workforce. The HR is responsible for ensuring every employee is working at its full potential while being happy and satisfied with their work. The employee engagement is a crucial function because it can impact each and every aspect of the business such as operational efficiency, technical capabilities, product and service quality, customer experience, employee satisfaction, profitability, etc. A performance management system provides a comprehensive framework, which help businesses in performance management process and it can greatly increase employee engagements. The performance management systems are designed to align individual employee performance with the high-level organizational goals and strategic objectives.

The performance management system seamlessly integrates various processes such as performance evaluation, feedbacks, reviews, appraisals, goal setting, etc. The performance management system is a modern software based solution which offers various tools and features which aid in performance management tasks. The performance management system is equipped with advance data collection tools, analytical reporting tools, and various other features which can help in performance management activities. In this blog we will discuss the role of performance management in employee engagement.

The Role of Performance Management in Employee Engagement
The Role of Performance Management in Employee Engagement

What is Employee Engagements?

Employee engagement is not just a single measurable substance, it is an entire spectrum of emotions and feelings an employee could have towards their organization, individual job role, daily work, co-workers, or team. The employee engagement is absolutely essential for the success, here is why:

  • Passion: Enthusiastic and passionate employees tend to work harder, as their work is very important for them and these types of employees are always read to meet new challenges.
  • Dedication: The engaged employees are more dedicated towards their work and goals, they believe in organizational goals and understand the value of their contribution to it.
  • Higher Purpose: Engaged employees believe in higher purpose, they feel their job role and work has a higher purpose which contributes to something higher-than themselves.
  • Growth: The engaged employees tend to be more eager towards growth and development, they tend to outperform the poorly engaged employees and tend to be more productive and skillful.
  • Recognition: The recognition and acknowledgement are the key factors, when employees feel valued they become more energetic, enthusiastic and dedicated towards their work.

See Also: Performance Management System: Best Practices

The business leaders and HR utilizes various methods and techniques to enhance employee performances. The performance management is one of the most widely used methods to increase employee engagement, productivity and efficiency. However, the traditional performance management methods are losing their impact, now a days, a modern software based performance management system is taking over. The modern performance management system provides a comprehensive framework coupled with modern performance management methods and practices. Businesses all around the UAE are adopting to modern performance management systems for higher employee engagements.

What is Employee Engagements?
What is Employee Engagements?

How Performance Management System Enhance Employee Engagements?

A modern day digital performance management system is a structured solution offering a comprehensive framework to implement modern and advanced performance management methods and strategies. The performance management system offers advanced monitoring and analytical tools, helping analyzing various aspects of individual and team performance. Furthermore the performance management system helps implementing policies to increase employee engagements and overall employee satisfaction.

See Also: What are the Features of a Best Performance Management System?

A well-implemented performance management system can greatly increase employee engagements:

  • Goal Setting: The performance management system streamline goal setting process with in-built features for objective key results (OKRs), SMART goals, and customized KPIs. The performance management system also help communicating goals to individual employees.
  • Alignment: When the employee goals are clear and communicated effectively, they knows what is expected from them, this also help them understanding how their efforts align with the high-level strategic goals and objectives.
  • Advanced Feedback: The performance management system provides a systematic and structured approach to streamline communication and feedback, encouraging continuous feedback and more frequent interaction help boosting employee engagements.
  • Employee Development: The performance management system not only monitor employee performance but it also help identifying strengths and weaknesses of the employees, highlighting the development opportunities and boosting employee competencies.
  • Reward and Recognitions: Appraisals, rewards and acknowledgements are essential for boosting employee morale and when the employees are admired, valued and have a sense of importance they tend to be more engaged and perform well.
How Performance Management System Enhance Employee Engagements?
How Performance Management System Enhance Employee Engagements?

See Also: The Impact of Performance Management on Organizational Culture

Furthermore the performance management system offers a variety of features and tools which can be very helpful for the management to keep employees more engaged and productive. Businesses can also customize these tools and digital features of the system to enhance its impact and adoptability. Here are a few more features that can be integrated in a performance management system to boost employee engagements and satisfaction:

  • Regular Feedback: A performance management system can help implementing a more frequent, regular, and continuous and even real-time feedbacks. The feedback is crucial in engaging the employees, it also keeps them motivated and help management course correct.
  • Customized Software: The modern performance management system relies on a software application, the performance management system software should be customized as per unique business needs to amplify its impact and to boost employee engagements.
  • Collaborative Culture: The performance management system can provide essential tools and features to enhance collaboration, communication and peer-to-peer feedbacks. Streamlined communication and peer recognitions help engaging and employees.
  • Mentorship Program: The mentorship program can greatly increase employee engagements. Managers and senior employees can be appointed as mentors to guide and coach the new or inexperienced employees and help boosting collaborations.
  • Training Program: When businesses invest in employees they tend to become more motivated and perform well. Personalized training programs, workshops, and learning opportunities can help boosting employee morale and increase their engagements.

With the advanced features of a performance management system businesses can conveniently foster a culture of highly engaged employees. Engaged employees tend to be more active, innovative, creative and confident. Employee engagements are crucial for higher performance and high-performing employees are crucial for long-term sustainable success.

See Also: 5 Performance Management Problems and How to Solve Them

The Performance Management System Offers a Variety Of Features and Tools
The Performance Management System Offers a Variety Of Features and Tools

Conclusion

Employee engagement is a powerful catalyst to boosting the entire organization’s performance, productivity and profitability. A modern performance management system is not just an appraisal tool used to evaluate the employees, but it is a highly structured and systematic approach to elevate the entire organizational culture. A digital performance management system comes with a customizable software application that can greatly enhance the impact of performance management.

The performance management system empowers employees, encourage communications, and provides a structured approach for regular and continuous feedback fostering a highly collaborative and connected organizational culture boosting employee engagements. In this blog we have discussed the role of performance management in employee engagement. If you want to learn more about the subject or if you want to our help to design and implement a bespoke performance management system for your organization, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

See Also: Performance Management System Trends in 2023

See Also: Choosing a Performance Management System A Buyer’s Guide

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The Impact of Performance Management on Organizational Culture

Performance management is one of the most important HR function, businesses and organizations strive to adopt to methods, ways and solutions that can enhance their productivity, operational efficiency and quality of work. The employee performance matters a lot for business growth, every business and organization wants to achieve a sustainable growth, for that the employee retention, satisfaction and high-performance is absolutely essential. High performing teams produce high-quality work, which inspire and attract customers and make them loyal to your brand. Earlier the performance management processes were carried out manually, which was very inefficient and eventually both employees and managers lost trust from manual practices. This lead to the creation of digital performance management systems and HR solutions.

The digital performance management systems are serving as a backbone for the modern enterprises. Businesses in Dubai, Sharjah, Abu Dhabi and all around the UAE have started adopting to digital performance management systems and HR solutions very early, now a days, such solutions have become so common, however, there are still businesses who are either stuck in old practices or haven’t moved to modern performance management systems. In this blog we will discuss how a modern performance management system can enhance organizational culture resulting in elevated employee performance and higher operational efficiency.

The Impact of Performance Management on Organizational Culture
The Impact of Performance Management on Organizational Culture

What is a Digital Performance Management System?

A digital performance management system is a software-based comprehensive framework and strategy which enable businesses to systematically monitor, measure and enhance organizational performance. The modern performance management system offers tools and mechanisms to efficiently execute performance management related tasks. It provides, real-time performance data coming from a multitude of systems and touch points, which is analyzed with in-built analytical tools and AI engine to provide performance data in interactive and intuitive dashboards. The HR team is responsible for conducting several performance management related tasks, which often are time-consuming and required a lot of efforts, this raise the cost of performance management and at the same time it also make the process more inefficient and inaccurate.

The digital performance management system on the other hand automatically collects data from various sources, minimize the human factor by significantly reducing manual work, bringing transparency and accuracy in the performance management process. It provides a comprehensive framework to setup goals, put monitoring mechanisms in place, provide automated reports and performance analytical data and help enhancing performance management function. Businesses can greatly enhance various performance management related processes such as performance appraisals, feedbacks and reviews, setting up goals and objectives, monitoring KPIs and progress, identifying hurdles and problems, enhancing employee development program, improving employee satisfaction and retention and much more.

What is a Digital Performance Management System?
What is a Digital Performance Management System?

How Performance Management System can Improve Organizational Culture?

The organizational culture is one of the most crucial factor which is often overlooked. The organizational culture have huge impact on employee behavior, attitude, and happiness and consequently the overall business success. A modern performance management system helps streamlining and improving various processes which have direct impact on organizational culture. A positive and productive organizational culture ensures employees are satisfied, valued, motivated, appreciated, engaged and recognized well. A performance management system provides high-tech tools and intuitive processes which majorly helps in the following core performance management processes:

  • Defining success, clear expectations, SMART goals and individual objectives
  • Communicating and relating individual objectives and goals with high-level organizational goals
  • Real-time monitoring and performance data collection with intuitive analytical tools
  • Continuous feedback and reviews, contextual performance and much more
  • Identifying problems, strengths and weaknesses and help making informed decisions
  • Designing effective and comprehensive employee development programs
  • Identifying high-performer, acknowledging their performance with effective reward programs

Apart from that, the performance management systems also help in various HR processes and with the ability to digitalize and automate the performance management process itself become very efficient, impactful and cost-effective.

How Performance Management System can Improve Organizational Culture?
How Performance Management System can Improve Organizational Culture?

What are the Key Benefits of Implementing a Modern Performance Management System?

Here are the key benefits of implementing a modern performance management system that positively impact the organizational culture:

  1. Driving Productivity: A performance management system can greatly increase productivity in any organizational culture by streamlining communication, increasing and encouraging collaborations, and high focus on the result-oriented progress. A highly engaged workplace lead to higher performance and it empowered employees to deliver their best efforts.
  2. Raising Employee Satisfaction: For any successful organization the importance of employee satisfaction is paramount. The performance management system enhance reward and recognitions processes encouraging employee to perform well by recognizing their achievements, providing them new opportunities, and fostering a culture of constructive feedbacks.
  3. Better Employee Retention: For any business or organization the employee retention is crucial, in order to retain employee the businesses must provide them a positive organizational culture. The performance management system boost communication, enhance collaboration, encourage efforts, develop employees’ skills and provide them more opportunities to grow.
  4. Align Employee Goals: The primary goal of any performance management system is to improve the overall performance of the business. For that it is extremely important that all the employees put their efforts in the right direction. The performance management system helps aligning individual employee goals with the high-level organizational goals and strategic objectives.
  5. Transparent Appraisal System: The transparency and accuracy is the core functionality of any performance management system. The appraisal process is a crucial aspect of performance management and it has profound impact on employee performance and satisfaction. A bias-free, effective and transparent appraisal system can greatly boost employee performance.
  6. Fair Rewards and Recognitions: Employee often complain of bias in traditional and manual performance management systems. The digital performance management system eliminates that and make reward and recognition processes fair and transparent. The employees are rewarded solely based on their performance criteria while all metrics are made available to them.

In the modern day business landscape the employees demand more frequent evaluation and continuous feedback from their managers. The Gen Z. is too impatience, they want instant gratification. This can be achieved only when you have an effective and efficient performance management system.

What are the Key Benefits of Implementing a Modern Performance Management System?
What are the Key Benefits of Implementing a Modern Performance Management System?

What are the Key Elements of a Modern Performance Management System?

A modern performance management system comes with several features which are very helpful in performance management process, administrative and management tasks as well as carrying out some regular HR tasks. Usually a performance management system is customized or tailor-made for any organization to align with their unique and exclusive needs. However, there are some elements that are inherent to any modern day digital performance management system:

  • Setting Goals: Setting up clear, realistic, measurable, and achievable goals for the employees gives them a sense of direction and purpose. When the employees know what is expected from them or what success looks like, they tend to perform better. The performance management system facilitate setting up SMART goals, while ensuring a perfect alignment between individual goals, and high-level organizational goals. This greatly improves overall performance.
  • Frequent Feedbacks: One of the biggest advantage of a performance management system is that it provides a comprehensive framework to encourage frequent feedbacks. Frequent and constructive feedback raise employees’ moral and encourage them to perform well. In most modern performance management system frequent and continuous feedbacks are common and can greatly enhance the impact of a performance management system on organizational culture.
  • Appraisal Process: The performance appraisal process is one of the most important and crucial process of a performance management system. It helps management evaluate employees, acquire a deeper insight to their strengths and weaknesses. A systematic and fair performance appraisal process ensures the evaluation is fair, transparent, and based on pre-set criteria. It also provides a system of constructive feedback, coaching and it aids decision making process.
  • Employee Development: The employee development programs are crucial to unlock the true potential of the workforce. A digital performance management system accurately identifies the strengths and weaknesses of the employees and provide them with the continuous coaching, opportunities to learn and grow which enables them to acquire new competencies and skills. This includes offering mentoring, training, resources and tools to enable them perform well.
  • Reward and Recognition: Higher level of motivation and engagement are essential to high performance, and for that a fair and well-designed reward and recognition program/process is absolute necessity. A performance management system provides a systematic approach to align rewards with performance while ensuring the performance is fully aligned with high-level organizational goals. Recognizing achievements and offering incentives elevates organizational culture and consequently the overall performance of the organization.

There is a strong correlation between employee performance and organizational culture. Happy and satisfied employees tend to be more loyal and have greater potential to grow and excel. A high-performing workforce requires a strong, positive and productive organizational culture which can only be achieved by effective performance management. A digital performance management system provides integrated solution, has ability to collect performance data in real-time and it offers multiple dashboards for monitoring. It also elevate several internal processes which results in better communication and higher collaboration. Employee goals can be aligned with high-level organizational goals and with help of real-time data monitoring tools the course correction is seamless which is essential for higher outcomes. These features and benefits made performance management system absolutely essential.

What are the Key Elements of a Modern Performance Management System?
What are the Key Elements of a Modern Performance Management System?

Conclusion

An effective digital performance management system have transformative impact on organizational culture. It is a combination of integrated digital tools, data collection and analytical tools, coupled with most modern performance management tactics and practices. The traditional performance management systems and annual appraisal reviews are very time consuming, require a lot of efforts, and are inaccurate which results in distrust and prompt businesses to shift to most modern practices and digital solutions. A modern performance management system on the other hand can greatly improve the efficiency and efficacy of the performance management process and help businesses greatly improve the organizational culture. A positive, strong and productive organizational culture foster high-performing teams. The digital aspects of the performance management system empower employees and increase engagements.

The business goals and individual goals should be fully aligned in order to produce higher outcomes. This has become very easy with the help of an effective digital performance management system. On top of that it elevate fairness and transparency resuming faith in the system and also help businesses to minimize employee turnover. All these features help enhancing organizational culture and bridge the gap between employees and managers fostering a more connected and collaborative work environment. In this blog we have discussed how an effective performance management system can positively impact organizational culture and boost overall performance of the organization. If you want to learn more about the subject or if you want our help to design and implement a bespoke and highly cost-effective performance management system for your business, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

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How to Develop Custom Performance Appraisal System in UAE?

The custom performance appraisal system in UAE are not very common. Usually businesses rely on cloud-based or commercial off-the-shelf solutions. The biggest problem with ready-made or stock performance appraisal system is that they are standardized for a particular industry, hence they are not as that flexible. However, every business is different and unique, and all businesses develop a completely unique culture and have different goals, needs and preferences for the performance management. Using a stock or commercial off-the-shelf solution can never fulfill such needs. Therefore businesses start looking into the possibilities to develop a custom performance appraisal system. For that businesses have two choices either they get it done by the internal software development team, which is very less obvious, and most of the time businesses doesn’t have IT teams who can deliver that kind of sophisticated application. The other choice is to acquire the services of a professional software development agency in Dubai or anywhere else in UAE who is experienced in HR solutions and performance management systems.

However, even if a business acquires a professional service provider or vendor, they must still have adequate understand of the performance appraisal system. In this blog we will discuss the important factors which will help businesses to get a high-performance and impactful performance appraisal system in UAE.

How to Develop Custom Performance Appraisal System in UAE?
How to Develop Custom Performance Appraisal System in UAE?

What is a Custom Employee Performance Appraisal System?

An employee performance system is a set of methods, techniques, tools and framework used to evaluate employee performance and progress against a pre-defined objective and it helps identifying the weaknesses, strengths and areas of improvement. The prime purpose of the employee appraisal system is to ensure that all the available resources are progressing in the right direction and their efforts are fully aligned with the high-level organizational goals and strategic objectives. The performance appraisal system is a foundation stone for growth and stability. Only by leveraging the full potential of the employees, a business can sustain and grow in the highly competitive and fast-paced markets like UAE. The employee performance appraisal system provides a comprehensive framework to collect employee performance data and feedback and transform this into actionable insight which helps management and HR department to take informed decisions and progress towards their high-level organizational goals and vision. When we say custom employee performance appraisal system the only difference is how the system is developed. A custom employee performance appraisal system is developed exclusively for a particular business as per their exclusive and very unique business needs. That is why it is called a custom employee performance appraisal system.

See Also: What are the Features of a Best Performance Management System?

What is a Custom Employee Performance Appraisal System?
What is a Custom Employee Performance Appraisal System?

What are the Benefits of Using a Custom Performance Appraisal System?

An effective performance appraisal system help businesses drive the productivity, it helps them minimize the problems caused by the lack of technical or behavioral competencies. The employee performance appraisal systems are not a tool to scrutinize the employees, but it is a comprehensive framework which lifts up the performance of the employee, increases employee engagements, and over the time strengthen their technical and behavioral competencies. A good employee performance appraisal system can have massive impact on a business’s growth and success. That is why it is important that the employee performance appraisal system you use is fully aligned with your business needs and resonate with your unique organizational culture and priorities. Here are the key benefits of using a custom performance appraisal system:

  • Elevating and Enhancing Communication: The communication is the backbone of our modern business ecosystems. All business functions should have a fraction-less and instant communication enabled in order to boost the operational efficiency. The lack of communication between employees and managers could devastate the performance and efficiency. It frustrate employees, fuel hopelessness and it kills productivity. The performance appraisal system help managers communicate the goals and objectives, and help employee understand the success criteria. Hence the employee are more motivated to progress in the right direction.
  • Appreciate High Performance and Improvements: One of the biggest concern of employees and managers is with the outdated appraisal practices is their efficacy and accuracy. A modern custom performance appraisal system help building trust and ensures the high performance is well appreciated while the areas of improvements are also noted accurately. Rightful incentive and appreciation not only boost employee morale but also encourage others to do well in the coming performance cycle. The reviews, feedbacks, and evaluation are done with a systematic framework which help employees and managers to understand what has to be improved and how, which also help raising the morale of low-performing employees.
  • Impactful Training and Development: Businesses who are actively offering training and development programs tend to perform well in UAE. A custom performance appraisal system does the heavy lifting and help the HR in many processes, which also enables them to design high-impact employee training and development programs. A well-organized performance data and intuitive reporting provide a better insight and help the HR to identify the training needs. The employee performance data can be analyzed by multiple angles and can be plugged-in into various other systems to ensure the maximum impact of training and development activities. The same can also be used to convince employee to participate in those programs and help businesses make the most impact of their efforts.
  • Guiding the Right Path: Studies have shown that the biggest reason of employee quitting form a jobs in UAE is the lack of clarity of their career path. A custom performance appraisal system provides you a wealth of performance data, when this data is coupled with employee data the HR can easily identify the suitable path for the employees and guide them with their long-term goals and career path. Such guidance is crucial, it help employees boosting their morale and confidence and it gives them a sense of importance and valued. When employees are guided to a right career path with a better scope and success in future, they become more loyal and satisfied. Happy and satisfied employees always tend to give their best.
  • Raise Employee Satisfaction: A modern custom performance appraisal system is a great tool to maximize the employee engagements. The employee appraisal system provides a systematic approach to engage employees at various levels and decision making processes. The digital aspect increase their trust, successful training and development programs raise their loyalty and satisfaction. With transparent evaluation practices, reward and recognition programs and frequent feedbacks and interactions the employees gain more confidence and become more satisfied with their job, knowing they are important and their concerns are addressed and their voice is heard. The employee engagements can greatly reduce the employee turnover too.
  • Help Under-Performers: Here in UAE business leaders and HR specialists are agreed that the under-performers are the employees who can seriously undermine the organization’s overall performance. A custom performance appraisal system helps HR to accurately identify the under-performers, closely monitor their performance and the impact of coaching and training and give them a fair chance to improve. The performance appraisal system is very much capable of identifying the reasons of poor performance which greatly help HR to address the real issues. It also help managers to provide right guidance, coaching and mentorship to encourage under-performers and to boost their morale.

See Also: Performance Management System: Best Practices

A good performance appraisal system not only align employees with the organization goals and objectives, but it also help developing and nurturing a highly productive organizational culture where the employees can improve and grow over the time.

What are the Benefits of Using a Custom Performance Appraisal System?
What are the Benefits of Using a Custom Performance Appraisal System?

How do I design a custom performance appraisal system?

Most of the time when businesses decide to adopt a custom performance management system they think it is a very sophisticated and time-consuming task. However, designing a custom performance appraisal system is not difficult at all. It is a very simple process, all you need is to consider following important aspects of performance appraisal and you can design a high-impact custom performance appraisal system:

  1. Understand Modern Performance Appraisal System: The modern performance management is way too different than the traditional/annual appraisals. More than 80% of the employee, business leaders and HR experts have shown distrust form the annual appraisals, as they majorly focused on the most recent events, and progress. However, the modern performance appraisal system facilitates more frequent and even continuous performance monitoring. Another drawback of traditional appraisals is that it is very time consuming. However, the modern performance appraisal systems leverage digital technologies and software based tools. Which ensures continuous monitoring, more contextual and comprehensive data, and highly accurate reports.
  2. Set Your Goals and Objectives: Whenever a business is acquiring a new system or implementing a solution they have clear goals and objectives, what they want to achieve with that system. Same is applicable here too, if you are designing a custom performance appraisal system you should set goals and objectives for that, it would be simply what you would want to achieve by implementing that system, such as getting better and deeper insight to employee performance, communicating the expectations, increase employee performance, driving efficiency and reducing redundant work, reducing the time, effort and cost of the appraisal process and so on. Setting up clear objectives for the system will help you maximizing the ROI as well.
  3. Define Benchmarks and Setting up Standards: It is important to do some research on industry standards and define benchmarks and set up your standards accordingly. It is very important to include the most effective elements and features in your custom performance appraisal system. In order to understand the impact of different strategies and features the market research is the key. Furthermore the case studies can help you understand different features of the performance appraisal system and accordingly you can vision your custom performance appraisal system. Studying market trends is equally important. That is why it is crucial to do some research and consult experts to define the scope of your system.
  4. Develop Metrics and Establish Success Measures: Since you already have a clear understanding of what you would want to accomplish with your custom performance appraisal system, it is absolutely essential to setup metrics and establish clear success measures. So, you can gauge your performance against your objectives. Furthermore establishing success measure will also help you to evaluate the efficacy and impact of your custom performance appraisal system. It is not as that complicated as it may sound, let us take an example of a goal which is ‘improving employee performance’ for that your custom performance appraisal system should be able to communicate what is expected from the employees, it should have tools to measure employee performance against pre-set goals and it should have features to ensure employee alignment with goals.
  5. Evaluate Your Current Appraisal Processes: It is important to scrutinize your existing performance management and appraisal processes and practices. This will help you identify the areas of improvements and missing tools or features which you can include in your new custom performance appraisal system. It is also important to collect user feedback, in this case the employees, supervisors and managers are your audience. You should conduct interviews with a sample from different audience/user pools and consider their recommendation as well. The next step is to analyze that data and revisit your success measures and ensure your success measures and goals are fully aligned with the benchmarks you are planning to achieve with your new custom performance appraisal system. We are still in the planning phase so any step can be revised and adjustments can be made if needed.
  6. Establish the Scope of the Project: Above all steps are mostly part of the planning. Forming a clear scope of the project is what you will hand over to the development team and get the system done accordingly. It is important to understand that the scope of the project is a high-level technical guideline or in fact a blueprint of your custom performance appraisal system. Make sure you add enough details and also expected outcomes. This will help the development team to build the features and functionalities in your custom performance appraisal system. At this stage you can also engage IT/Technical teams to make this charter more contextual, descriptive and technically understandable for the development team.

See Also: How to Design a Modern Performance Management System?

How do I design a custom performance appraisal system?
How do I design a custom performance appraisal system?

How to Implement a Custom Performance Appraisal System?

Once you have a completed the planning phase and prepare a detailed scope of the project with all the features you need. Now is the time to appoint a custom software development team to execute the project. Remember the employee appraisal system and performance management is not just a method or strategy, but it is actually a very powerful software application which lifts the heavy load and enable the HR to effectively implement their employee appraisal and performance management strategies. This requires a powerful software engine which can collect performance data, analyze it as per your needs, and produce intuitive reports to let the management understand the performance status and provide them administrative dashboard with required features to acquire insight and take informed decisions and then effectively implement their decisions and action plans to course correct and take measures to ensure the set-goals are achieved at the end of the performance cycle. The software development team will follow the scope of the project document, and build that software engine for you. You can hire in-house team to build custom appraisal system for your business or you can outsource it to a well-reputed and experienced vendor who can further help you refine your system and provide required training for the system to ensure maximum impact can be created with it.

See Also: Benefits of Implementing a Modern Performance Management System

How to Implement a Custom Performance Appraisal System?
How to Implement a Custom Performance Appraisal System?

Conclusion

Businesses who are operating in Dubai, Sharjah, Abu Dhabi or any other emirate of UAE are well aware of the fact that the employee retention is one of the biggest obstacle in growth. The overall UAE market is very competitive and it is relatively easier to switch the job. In such scenario retaining good talent is quite difficult. Furthermore the markets are very competitive and the businesses have to ensure their customers are having a satisfactory experience and excellent service which is nearly impossible with your employee performing with optimum level of productivity and efficiency. Therefore businesses tend to implement various different types of performance management and employee appraisal systems to ensure they achieve their high-level organizational goals. In order to achieve your organizational goals and strategic objectives, the employee must be aligned with your goals, satisfied with their job role, motivated, guided, trained and engaged. This all can be achieved only when you implement a systematic framework to measure and monitor your employee performance and offer them a highly transparent and fair appraisal system.

A business have two choices, either they can acquire a commercial off-the-shelf solution or they can develop a custom performance appraisal system. The bespoke solutions tend to deliver more comparing to standardized off-the-shelf solutions. In this blog we have discussed how a business can develop and highly-effective and most impactful custom performance appraisal system. If you want to learn more or if you need our help to develop a custom performance appraisal system for your business in UAE, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

See Also: Choosing a Performance Management System A Buyer’s Guide

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Performance Appraisal System for the HR Department

The HR Department at any business or organization is one of the most important business function. The HR is responsible for the capabilities and performance of the workforce for the business. If the business have all the required skillset with high performing teams, individuals and business functions, nothing can stop it from dominating the market. Here in Dubai and all around the UAE the markets are very competitive comparing to other gulf countries in GCC and MENA regions. Tougher competition requires maximum performance and productivity. The HR department designs performance appraisal processes to boost the employee performance and capabilities of the workforce. Individual employee performance adds value to the team performance which reflects in the overall performance of the business or organization. That is why the HR department is considered to be the most important business function and the performance appraisal is the key driver for the high efficiency, quality of work, productivity, profitability and growth of the business.

Performance Appraisal System for the HR Department

In any market or any scenario leveraging employee’s full potential can provide a great competitive advantage. Whether it is lowering the cost, raising the product/service quality, optimizing the operations and management or anything else, the employee performance is crucial. Businesses have their long term goals and vision. Every business strive hard to achieve those goals and objectives. However, most of the time we noticed that the problem lies within the practices and methodology rather with the resources a business is investing or willing to invest to achieve their high-level organizational goals and objectives. The performance appraisal is the major process a business relies on to optimize and increase its performance. On the bases of performance reviews and appraisals a business perform several HR related tasks, the same are used for building employee development and training programs which are crucial for performance management. In this blog we will discuss how a performance appraisal system can solve a lot of problems and how a business can achieve their performance objectives with it.

Performance Appraisal System for the HR Department

What is a Performance Appraisal System?

The performance appraisal is a process of reviewing employee performance usually at the end of a year and on the bases of these reviews the HR department or reviewer determines the value and worth of an employee and its contribution to the high-level organizational goals and strategic objectives. This entire process is a very time consuming and often done almost manually which requires HR department to invest a lot of time and resources in the process. The performance appraisal system is a software and a digital solution which help businesses streamline their performance appraisal process and automates various steps to save time and resources. The performance appraisal system is capable of enabling businesses to execute both traditional and non-traditional appraisal processes with higher accuracy and more efficiency. The performance appraisal system also offer a variety of modern solutions and improve data flow and communication which is a great advantage.

What is a Performance Appraisal System?

Furthermore the performance appraisal system offers digital tools and allow HR department to evaluate the employee performance against a set of pre-determined objectives, their strengths and weaknesses, their worth and value for the business, the financial aspects of retaining an employee, and facilitates various other HR processes, especially decision making. The performance appraisal system is also capable of integrating with various other third-party tools and systems and help businesses to leverage the data more efficiently. The performance appraisal system also support modern needs and allow businesses to customize their own appraisal strategies and processes. One of the biggest advantage of the performance appraisal system is that it allow businesses to conduct more frequent reviews such as twice a year, at each quarter, monthly or even at the end of a particular project or phase. Which allow management to continuously monitor performance and take timely decisions to set course and make corrections to ensure at the end they will achieve their high-level goals and objectives.

What is a Performance Appraisal System?

Types of Performance Appraisal in Human Resource Management

Majorly the performance appraisal process involves top-down reviews in human resource management. Where a senior employee evaluate and review their subordinates. There are conflicting information about the origins of the performance appraisal process, however the most common belief is that the performance appraisal processes was first created and implemented during the word war I, however the corporate sector have adopted it in somewhere between 1950s.  Here are a few types of performance appraisals:

  1. Top-Down: This is the traditional employee performance evaluation technique. In this method the supervisor or line manager reviews the performance of the employees and usually the employees doesn’t have any say in the review.
  2. Self-Assessment:In this method the individual employees rate their abilities, skills, behavior, competencies and performance by themselves. Obviously this could be biased but it has great impact on the employees and encourage them to perform better.
  3. Peer-to-Peer:In this appraisal processes, the co-workers, team members and other relevant employees who work alongside with the individual employee review their technical, personal and behavioral competencies.
  4. 360 Degree Feedback: This is a very broader feedback and review process it includes review and feedback from peers, managers, supervisors, cross-function and cross-team feedback, customer and supplier feedback and review from any other stakeholder.
  5. Negotiated Review:This is a more detailed employee performance review, it considers the employees tasks and what they were doing before the review, and it also allow employees to give their opinion/explanation along with the review. Great to resolve disputes.

Types of Performance Appraisal in Human Resource Management

Key Advantages of Performance Appraisal System for the HR Department

The performance appraisal system allow the HR department to closely monitor and optimize the performance of the entire business across all its functions. Here in Dubai and all around the UAE various performance management methods are adopted by the businesses. The performance management system is a very powerful digital tools which doesn’t restrict you to follow only certain methods or practices, in fact it allow businesses to keep evolving and improving their appraisal methods and practices over the time. Here are the key advantages of the performance appraisal system:

1. Collect Valuable Feedback

The feedback is the core of the performance appraisal. A good performance appraisal system provide multiple channels to collect feedback from multiple resources and combine it in a single dashboard to provide a quicker and broader view of the employee performance with high accuracy and reliability of the data. The performance appraisal system allow businesses to improve the transparency of the process and collects data from multiple streams which further improve the accuracy and quality of the feedback data. The performance appraisal system not only collect feedback data but it digitalize it and allow HR to perform several analysis with in-built tools and let them generate actionable reports. Which not only improve the quality but also enable them making more informed decisions with positive impact on the overall performance of the business.

Collect Valuable Feedback

2. Set SMART Goals and Objectives

SMART goals and objectives are crucial for performance management, most of the time the HR Department failed to achieve their performance goal because their goals and objectives are not properly set. The SMART goals and objectives means Specific, Measureable, Achievable, Realist/Results, and Time-bound. The SMART goals and objectives are a very popular technique and performance appraisal system allow businesses to effectively execute it. Furthermore the performance appraisal system allow more in-depth monitoring, historical data and comparison features which help businesses to improve their goals and objectives too. When employee are given SMART goals, they tend to perform well. It gives them a sense of focus, encourages them to outperform themselves and others and help boosting their morale.

Set SMART Goals and Objectives

3. Improve Promotion Process

For any business or organization it is extremely important to bring the right people at the tops and keep everyone at the right place. For that the businesses follow promotion processes which is mainly based on the employee performance appraisal. The performance appraisal system makes this process more efficient, accurate, and transparent and help HR department to accurately and more closely understand the strength and weaknesses of an employee. Only employees who deserve promotion should get it, it will keep the morale of the others high and will encourage them to follow their footsteps. If wrong person got promoted they will eventually failed, and the other employees especially who deserved promotion will feel a sense of left-behind, their morale will decline and they will also lost over the time. Despite having required talent the HR department might have to hire new people which put extra strain on the business.

Improve Promotion Process

4. Improve Reward and Compensation Process

Another great advantage of employee performance appraisal system is that it help the HR Department to improve the reward and compensation process and methods. The performance appraisal system provides in-depth performance data and also monitor several KPIs (key performance indicators), hence the reward and compensations are not only awarded on the bases of the supervisor’s reviews, but a lot many other factors are also taken into account. Which improve the reward and compensation process and ensures the employee who work harder throughout will get the most benefits. Rather than on the bases of just one mistake or just one last performance they rewards and compensation or salary raise is not given. Which encourage employees to perform well throughout the appraisal period and help HR Department to improve the overall performance.

Improve Reward and Compensation Process

5. Improve the Effectiveness of Employee/Individual Development and Training Program

For any business who wants to grow it is crucial to up-skilling their employees and keep their workforce up-to-date. The performance appraisal system help HR Department to closely monitor employee performance from various different prospective to understand their strength, weaknesses and potential. The performance appraisal system makes it easier to collect all the feedback and performance data from various different competencies, such as technical skills, behaviorally anchored reviews, ability to deal with unexpected situations, decision making abilities, and much more. Hence the training and development program is not only limited to the reviews, but it is designed considering a lot of factors which help HR department to build a more beneficial training and personal development program. According to several studies the training and development programs are a key driver for employee retention and are equally important as rewards, compensations, promotions and non-monetary acknowledgments.

Improve the Effectiveness of Employee/Individual Development and Training Program

6. Help Retaining Best Talent during Downsize or Right-Size

The performance appraisal system collects feedback and data from various sources, it can also help HR Department to accurately estimate the financial impact on an employee for example, how expensive the employee is and what financial value he/she is adding to the business. Furthermore the performance appraisal system provides HR Department with the most accurate data about employees and their capabilities which help them to understand the worth of each individual employee and their impact on performance of their team, department or the overall performance of the entire organization. There could be many reasons for downsizing, such as financial difficulties, new competition in the market, overall market conditions, etc. Which force businesses to lay-off some of their workforce to optimize the expenses. Right-sizing is a relatively new turn, it also means laying off employees but not due to external factors. In fact it accounts internal factors, such as an employee become non-productive over the time, their behavior got changed and is impacting others, or their skill might not be needed.

Help Retaining Best Talent during Downsize or Right-Size

Mostly due to new technologies and automation business might not need certain skills. Whatever the scenario is if a business will have to lay off some of its employees, the performance appraisal system ensures that the business retains the best talent and only lay off the poorly performing or low-performing employees with least impact on the overall operational capabilities and performance of the business.

7. Improve the Impacts of Coaching and Mentoring

The managers at each business are expected to coach their sub-ordinates and teammembers. If a manager is saying the right thing, the employees will keep inspiring from them and it will become easier for the manager to become a good mentor for the employees. However, this is not as simple as it may sound. It is very difficult to understand the actual difficulties and problems an employee is facing and where they need support to make improvements. However, with the help of performance appraisal system since everything is digital and a huge amount of data is available for the managers with interactive reports and intuitive performance dashboards. This enables them to understand the obstacles an employee is facing but is unable to express. The performance appraisal system also help them understand the strength and weaknesses of the employees in terms of technical, behavioral and knowledge competencies. Which let them communicate better with the employees and help them encourage to perform well.

Improve the Impacts of Coaching and Mentoring

8. Increase Employee Engagements

Employee engagement is one of the most serious concern of the HR department, as it is very crucial for employee retention and to boost their performance and productivity. Communication is a key to employee engagements. A performance appraisal systems facilitates and encourages communication between the individual employees and their supervisors or managers. Furthermore the ability to collect 360 degree feedback also allow individual employee to review the performance of their supervisors and managers and also let them provide feedback about them. Which not only help improving the performance of the supervisors and managers but also tell employees that they are important and their opinion matters too. The digitalization help improving in-person and digital communication which also let the managers and HR Department understand the problems, issues and strengths/weaknesses of the employees and let them address the issues.

Increase Employee Engagements

The performance appraisal system also help communicating the individual and high-level organizational goals and objectives to the individual employees and tell them about their value and contribution in the high-level goals. Which increase employee engagements and also help HR Department to reduce employee turnover.

9. Improve Employee Retention

For any business retaining the employees is a key factor in maintaining a great workforce. When businesses hire an employee, they invest on them, the employee themselves gain experience over the time, they get integrated within the organization and understand its internal processes and culture. However, the new recruits will take time to learn and understand the internal processes, culture of the business and many things, hence they take a lot of time to reach to the performance level of their predecessor. This entire process costs a lot of resources and have significant financial impact too. That is why employee retention is very important. The key factors that plays role in employee retention are reward and compensations, individual development programs, and the communication. If the employee knows they are valued by the business and their say will be listened they feel more connected to the business and become more loyal. The employee loyalty doesn’t only increase employee retention but it also drive performance.

Improve Employee Retention

10. Help HR Department Dealing with Legal Situations

Here in Dubai and all around the UAE the federal and local governments have very strict laws and regulations against discrimination and employee rights at workplace. The federal and local governments have great policies in place to protect employee rights and have several government departments to ensure the workplace environment is supportive for the employees. Discrimination or favoring an individual employee due to personal bias or any other reason could lead to a lawsuit. Hence having a proper performance management system in place could provide you an advantage and let you provide all the data to prove no misconduct have happened. Such claims could have devastating impact on the business’s reputation and could also have a significant financial impact too. Which is why a proper performance appraisal system will help you dealing with such situations. In fact the performance appraisal system ensures greater transparency which help preventing any such situation.

Help HR Department Dealing with Legal Situations

What are Key Objectives of a Performance Appraisal System for HRM?

The employee performance appraisal system is a tool for human resource management which helps to implement performance management strategies and to achieve higher performance across the entire business. Basically the primary objective of the performance appraisal is to align all available resources with the high-level organizational goals and objectives to maximize the contribution of each individual employees in the business goals and objectives. The rapid adaptation of new technologies and digitalization in the business practices have completely changed the dynamics of traditional performance appraisal methods. Now a days’ businesses are practicing more modern performance appraisal methods which are mainly aided by a digital solution or software since the manual processes tend to be ineffective and prone to errors and issues which can cause a variety of very serious problems for the HR Department. Here are the five key objectives of using a performance appraisal system:

 

Set and Communicate Goals Effectively

1. Set and Communicate Goals Effectively

Setting up goals is the very first step towards performance appraisal process. The SMART goals and objectives are the modern form of goals, however, setting up perfect goals and objectives that align individual resource with the top-level goals and objective is not enough, being able to communicate those goals and objectives to the individual employee is a key to success. Communicating what each employee will have to do and what is expected from them will encourage them and provide them more clarity which results in great improvement in overall performance and efficiency.

Continuous Feedback Collection

2. Continuous Feedback Collection

Feedback at the end of each year will only help you identifying the issues and problems and on top of that mostly the traditional year-end appraisals are largely influenced by the latest performance rather than the overall performance throughout the year. Performance appraisal system offer continuous feedback and allow managers to correct course during the appraisal period and evaluate several time to ensure everything is on track. This makes easier to achieve the high-level and individual goals by the year-end.

Identify Strengths and Weaknesses

3. Identify Strengths and Weaknesses

Today’s world is rapidly changing, businesses have to keep their workforce up-to-date and relevant all the time. Technologies are coming and going at a rapid pace which is also impacting the business practices hence the employees and their job roles as well. Even small looking problems can have huge impact over the time. It is crucial to identify the strengths and weaknesses of the employees and guide them appropriately and take measures to improve the workforce. The performance appraisal system made it very simple and easy as the entire data is digital and extracting actionable reports requires just a few clicks.

Talent Development and Employee Retention

4. Talent Development and Employee Retention

The talent development depends on employee retention. Employee retention can be increased by increasing employee engagement and offering transparent reward and compensation programs. Furthermore the talent development is done by conducting good training programs, coaching and mentoring. The performance appraisal system help building a complete framework to achieve all that and improve the outcome of all relevant efforts. It is much more expensive hiring a new employee comparing to retaining an employee and developing them gradually over the time.

Reward and Recognize Performance

5. Reward and Recognize Performance

Recognizing the performance of an employee means rewarding them for their good performance. The performance appraisal system not only monitor employee performance but it regularly collect data which help managers and supervisors to understand various obstacles an employee is facing. It remove bias and make reward and recognition processes more transparent. When an employee’s good work is acknowledged by either monitory or non-monetary compensations it encourages them as well as others to perform better.

 

Conclusion

The HR Department at any business is one of the key component which is responsible for ensuring a smooth operation and sustainable growth. The make sure that the business have required skillset and a high performing workforce to achieve maximum productivity and profitability. The performance appraisal is one of the core process of the HR Department. Traditionally the performance appraisal was done at the end of the year, and mostly it is a manual process. It takes a lot of time, requires a lot of resources and due to manual process the problems and issues are very common. However, the performance appraisal system is a digital solution and software which has ability to automate and simplify the performance appraisal process. It increase transparency and accuracy of the appraisal and help boosting the performance of each individual resource, departments and entire organization. RSI Concepts is a leading performance appraisal system designing and development company in Dubai, UAE. If you want to learn more about the subject or want us to help you building a high quality performance appraisal system exclusively for your needs, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

Check out this : Software Development: In-house vs Outsourcing

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How the HR should select a Performance Management System?

How the HR should select a Performance Management System

For any business the human resource is considered to be the backbone of the business. The HR is responsible for hiring skilled staff. The HR is also responsible for employee retention and employee happiness. Job satisfaction is a very positive factor and can boost one’s performance by many times. Here in Dubai and all around the UAE the market is very competitive, the customers are also very savvy and there are other challenges too which makes it extremely crucial to make your employees productive and efficient. For that businesses uses multiple methods and tactics, most of the businesses use a performance management system. The main reason to use a performance management system is to measure and evaluate the employee performance and their impact on the high-level organizational objectives and goals. Basically the performance management system is used to make sure all the employees and departments are working in the right direction to achieve the high-level organizational goals and objectives.

How the HR should select a Performance Management System

The continuous performance monitoring and evaluation also help encouraging employees to perform well. The performance management system is also used to improve employee’s capabilities. It helps HR in many ways and it enable businesses to implement employee development programs which help them improving their employees’ professional skills and capabilities. The performance management system is also a great tool to understand the strengths and weaknesses of the employees which help businesses in effective and efficient resource planning and management. All these benefits can help businesses and organizations in achieving their goals and objectives and maximize the productivity and profitability of the business.

When it comes to implementing a performance management system there are several options available in the market. Here in Dubai and all around the UAE the off-the-shelf and ready-made solutions are in abundance which also makes it difficult for the HR to decide which system they should acquire. Obviously each business have different needs and plans, so in this blog we will discuss how the HR should choose the right system for their needs.

What is a Performance Management System?

A performance management system is mainly a software which have in-built features that allow the businesses and organizations to execute the performance management tasks and strategy. There are two major parts of performance management. First part is called performance management system which is drawing a roadmap to achieve the goals. The second part is performance appraisal system which is basically measuring the performance and progress of each individual employee, teams, departments and management with the reference to the high-level organizational goals and objectives. Although most of the time the performance management system and the appraisal management system are interchanged and referred to as the performance management system only.

What is a Performance Management System?

The performance management system software can be hosted on cloud, online hosting or in local/in-premises data centers. The system is interlinked with the central information center as well as all necessary systems and tools via API based integration which enables it to synchronize, update and push data to and from other systems.

Here are a few important things that the HR should consider while selecting a performance management system:

Performance Management System Software Technology and Platform

For any performance management system the software technology and the platform is crucial as it will not only support businesses with customization and scalability but it also have huge impact on the cost. The performance management system must be built on a widely available technology. Hence the changes or customization should be easy. These days many performance management systems are utilizing open-source programing platforms which is very cost-efficient and easy to customize. Furthermore the performance management system should be able to provide easy and cost-efficient scalability. The performance management system’s software consists of user interfaces (UIs) and a core server application.

Performance Management System Software Technology and Platform

The server application is where all the source code and algorithms are stored and executed. Hence the software platform should be able to support multiple server technologies such as online hosting, cloud hosting, local or in-premises hosting solutions. This will enable the business to choose appropriate solution as per their convenient and doesn’t put extra strain on the expense by forcing them to opt for a particular hosting technology.

Exclusive and Intuitive User Interfaces (UIs)

For performance management system or in fact for any system it is extremely crucial that the users are able to use it without any trouble. The intuitiveness and simplicity improves user experience which improves the overall efficiency and efficacy of the system. For the performance management system as it should be utilized by different all of the employees who all have different level of IT proficiency and computer knowledge, so the user interfaces should be designed to keep the users in mind. In a standard performance management system there are several different types of user interfaces which are all designed for different user groups, for example the user interface (UI) for the employee would be very different from the user interface for the CEO or the top level executives.

Exclusive and Intuitive User Interfaces (UIs)

That is why it is extremely important that the user interface is easy to understand and intuitive. In some cases if training is required then the training should be provided to the staff. An employee or even a manager can only get the full benefits of the performance management system if they could use it easily.

Flexible Goals and Objectives Implementation

This is the most important part of any performance management system. The performance management system must have to be very flexible and user-friendly to enable the users to easily set goals and objectives in the system. At every managerial hierarchy till the individual employees the system administration (which is top level management) should be able to transmit the goals and objectives. In-built features should allow the board of directors and senior management to communicate the high-level organizational goals and objectives with the head of departments, directors, etc. and then they should be able to communicate those goals to their respective teams. For example the director operations should be able to set goals of the managers from the department and then they can do the same for the next level of employees and then the line managers, supervisors, etc. and at last the individual employees. This should be available for all business functions.

Flexible Goals and Objectives Implementation

In this way the high-level organizational goals and objectives can be effectively communicated to everyone in the chain and businesses can get better results. Furthermore a good performance management system always encourage inputs and feedbacks from the individual employees and lower level management, which help them understand the goals much better and when employee have their say in planning and strategic affairs they feel more compassionate about their work and become more loyal with their employer. This can help improving their performance too.

Strong Monitoring Tools and Dynamic Strategy Implementation Approach

Most of the time the high-level organizational goals and objectives never changed, they remain same for the entire year. However, due to unplanned and unforeseen circumstances the individual goals and plan of action can be changed to remain on course for the high-level organizational goals. This requires continuous monitoring of the performance and the progress. A good performance management system should be very flexible towards implementing strategy and plans. It should provide continuous performance data to the managers and supervisors and let them change or amend the goals at any time. This course correction help them dealing with unforeseen events, interruptions and unplanned events.

Strong Monitoring Tools and Dynamic Strategy Implementation Approach

Another upside is that it also provide continuous performance data to the employees as well and provide them with a chance to improve their performance to reach their goals and objectives. Furthermore it also estimate the impact of the individual performance on the overall performance of the team, department and the organization as well. Which also help encouraging the employees to perform well and it gives them a sense of importance which is good to improve employee loyalty and employee retention.

Continuous Employee Feedback

For any performance and appraisal management system the employee feedback is absolutely essential. It provides management a chance to evaluate the employees in a more accurate and better way and it also help reducing the communication barrier which is usually present among the junior employees and the management. The performance management system should have a dedicated in-built module for the employee feedback management. Where the managers should have ability to schedule one-on-one feedback sessions for any of their subordinate and also the manager who will be conducting the feedback session. The performance management system should also include online feedback features to conduct online surveys and feedbacks.

Continuous Employee Feedback

Furthermore the peer-to-peer, top-to-bottom and bottom-to-top feedback collection mechanisms should be available. These features can become very handy for the HR department and they also help understanding the problems and issues of the employees in greater depths.

Employee Appraisal Management & Reward Modules

The employee appraisal management is a very crucial part of the performance management. The employee appraisal is basically their performance during a particular time period. The employee appraisal management modules measure the employee performance on the bases of their progress towards the objectives, goals, and their contribution in the overall organizational goals and objectives. The appraisal management is the key component that is used to align all organizational resources with the high-level organizational goals and keep everyone on track to ensure the high-level goals and objectives will be achieved. The management by objectives is a modern appraisal method that involves employees in goal setting and strategy building process. Furthermore there are other methods too such as behaviorally anchored performance scales, 360 degree feedback, straight ranking appraisal, accounting appraisals, etc. and many more.

Employee Appraisal Management & Reward Modules

A good performance management system should not only support all these methods but it should also be able to allow the management to customize and configure their own methods and techniques. The appraisals play a crucial role in improving the overall productivity and profitability of the business. On the bases of the performance evaluation the performance management system should also help businesses to implement an effective reward program. The reward program help businesses in improving employee’s morals, encouraging them to perform even better in future. Furthermore the performance management system can provide accurate data on technical and behavioral competencies which help businesses to setup and plan training programs and it also help them in measuring the effects of the trainings and skill enhancement programs. This help HR to improve the overall operational and professional capabilities of the entire workforce.

Employee Appraisal Management & Reward Modules

KPIs, OKRs, KRAs, and other Matrices

The performance management system have in-built performance measuring matrices. These matrices are used to track, monitor and measure the performance of the entire business along with all its business units, departments, teams, and employees. The KPIs are Key Performance Indicators which are used to measure the performance of the individual employees, teams, departments, and even the entire business. The KPIs are used to communicate what is needed from an employee and quantify their work to assess the performance. While the KRAs or Key Result/Responsibility Areas are matrices that are used to measure the employee performance in terms of the expectations from their job role. Majorly the KRAs are used to clearly communicate the job role of the employees and give them a perspective of what the business is expecting from them and what should be their contribution.

KPIs, OKRs, KRAs, and other Matrices

The OKRs means Objectives and Key Results and it is a fairly new performance management method. The OKRs are reviewed more frequently (usually at the end of each quarter) and they are transparent both horizontally and vertically. The OKRs are different from KPIs as the KPIs provide the measure of the effectiveness of the existing processes, the OKRs mainly address the change and growth and it measures how far a business have progressed in in a certain time period in pursuit of their goals and objectives. These are some matrices that any good performance management system should have. These matrices and a lot many more such matrices improve the efficacy of the performance management system.

KPIs, OKRs, KRAs, and other Matrices

Performance Management System with Remote Access Enabled

A good performance management system must also have capabilities to provide access to the employees remotely if needed. These days in general our dependence on the smartphones and mobile devices is increasing.  In fact most of the people use their mobile devices as their primary device to access the internet and do regular tasks. Furthermore businesses in Dubai and all around the UAE usually have many branches and most of the time employees are deployed off-campus or at project sites. This means that all of the employees wouldn’t have access to the computer or they won’t be able to come to the head-office to access their performance management system dashboard. Sometimes the higher management and stockholders also want to access the system from remote locations such as if they are at home, or at a business trip or if anything urgent came up while they are not at the office, etc.

Performance Management System with Remote Access Enabled

That is why having the facility to provide remote access via mobile and smartphones could be a great advantage. Businesses can also integrate special purpose interactive kiosks with the system which can provide access to the performance management system from remote locations and make it possible for all employees to access their dashboard any time and from anywhere. Such features are very helpful in improving the effectiveness of the system and help businesses improve their performance in all sectors.

Performance Management System Cost – Customized VS Off-the-shelf Solution

Obviously the cost is one of the major factor. Whenever a business planned to acquire a new system or tool the cost is always an important anchor point. The ROI is calculated on the bases of the cost and the returns a business gets from the software or system. There are two types of performance management systems on the bases of their cost and usage agreements. Some companies are providing ready-made or off-the-shelf performance management systems which can be acquired on the rental bases or at different subscription plans. In both cases the scalability is expensive and the business must have to pay for the plan or package they have opted for. Usually these plans and packages are designed for general purpose hence most of the businesses end up paying for unwanted features and tools as well.

Performance Management System Cost – Customized VS Off-the-shelf Solution

The data is stored in the service provider’s storage and business have no control over it. Another big disadvantage of off-the-shelf solutions is that they are hard to customize and sometimes businesses have to wait for a long time to see the new features in the updates. If any customization is done, it remains limited and it is also very expensive and in some cases it is not permitted at all.On the contrary the custom-build performance management systems provide full control and freedom. The business usually acquired a software development company like RSI Concepts or they hired a team of programmers and developers. In any case the business have full ownership rights over the software and it’s all resources. This make scalability a non-issue and business can include as many employees, departments, branches and everything whenever needed without paying hefty charges or upgrading fees.

Performance Management System Cost – Customized VS Off-the-shelf Solution

Furthermore the full ownership frees the business from dependency on a single vendor and businesses can move to a new vendor or service provider without losing anything or going through the migration problems. This make customized performance management systems more superior and cost-efficient. In the long term the cost to benefits rates are excellent and the business have more control and freedom over their performance management system.

Conclusion

The performance management system is a very critical component of any business’s management. Businesses use a digital performance management system to plan and execute strategies as per their goals and vision. However, when it comes to selecting an appropriate performance management system the HR department had to be very careful. The performance management system could have a significant and long term impact on the business’s growth and productivity. In this blog we have listed some basic features which will help the HR department to choose the best solution for their performance management needs. A performance management system help businesses to set realistic goals and help them implementing strategies to achieve those goals. It significantly improves communication.

The performance management system also help employees’ in understanding their job roles, the expectations from them and the importance of their contribution in the overall high-level organizational goals and objectives. The feedback and planning tools help businesses including the employees in planning and strategy building phases which increase their trust and improve their relationship with the business.A performance management system is absolutely necessary for any business. Each business grows, some grow faster and some at a slower pace but eventually each business grows and their internal business processes become more complex and sophisticated. A performance management system ensures the business sustain that growth and with the growth it also improves it workforce, operational capabilities while ensuring higher productivity and performance.

RSI Concepts is a leading performance management system provider in Dubai, UAE. If you want to learn more about the subject or if you need our help to provide you a high-quality performance management system, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.

Check out this: Employee KPIs and Performance Management

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Appraisal Methods in Performance Management System

 

Appraisal Methods in Performance Management System

Employee Performance Management is a set of processes and activities which helps organizations to develop their employees and improve their productivity and efficiency. However, the performance appraisal, in fact, is the actual periodical review of the performance of an employee. The appraisal system reviews and assesses employee’s actual performance, skills, work quantity & quality, achievements and contribution to the organization within a specific period of time. The performance appraisal system measures the performance of an employee on the basis of predefined scales or objectives and their contribution to the organizational objectives and goals. The appraisal system plays a very critical role in aligning all of the organizational resources to the organizational objectives. The periodical appraisal review determines

  • Employee skill level
  • Work quality in contrast with the quantity
  • Strengths and weaknesses
  • Growth or lack

This provides a very clear insight into an employee’s capabilities and an organization can easily decide the contribution the employee makes towards the organization. Periodical appraisal promotes quality of work and exposes maximum potential from a resource.

There are different methods and techniques of performance appraisals. Here are the most commonly used appraisal methods:

Appraisal Method 1: Management by Objectives

Appraisal Method 1 Management by Objectives

Get the employee involved in the goal-setting process with the line manager.

This is the most advanced method of Performance Appraisal. My organization has adopted this method in 2021 to align the goals of the organization. The Performance Management System developed by RSI Concepts has provided this method and encourages organizations to utilize it more than other methods.

Studies have shown when an employee gets involved in the goal-setting process, they are more likely to achieve those goals. The manager and employee both plan the objectives for a certain period of time and then those objectives are monitored and measured to assess employee performance. The management by objectives is a full-on process rather than a one-time evaluation. It could be set for a particular time interval such as a month, quarter, yearly or bi-yearly. Once the goals are set, a strategy has been formed and the plan has been executed. The manager and the subordinates both sit after a certain time interval to discuss the progress and to estimate the future expectations. This also provides them a chance to improve the ongoing progress by tweaking their existing strategy and plan.

The management by objectives involves both the subordinate and the line manager so it provides a greater self-awareness, which encourages the employees to perform better. It is considered to be the most cost-effective employee appraisal method. The subjective bias can also be eliminated and the method is very effective in measuring the performance of the senior management, mid-level managers, frontline managers, supervisors and employees.

Appraisal Method 2: 360 Degree Feedback

Appraisal Method 2 360 Degree Feedback

Get feedback not only from the line manager but all the peers involved in the process.

The 360 Degree Feedback is another latest method in Performance Appraisal and adopted by many organizations or by some departments within the organization. It provides a detailed assessment of the employee. Usually, the feedback can be collected from many individuals, including senior colleagues, subordinates, supervisors, customers and managers known as peers. The catch here is all of these personals who are giving their feedback must have been working with or around the employee but in the business process – who is being assessed. The 360 Degree Feedback is mostly to assess the overall contribution of the employee towards their job role, tasks, objectives, expectations and organizational goals and objectives.

The 360 Degree feedback process could take up to two weeks to get complete, it starts with selecting the participants also referred to as raters. The selection of participants or raters is important and it could be up to 25 persons, it entirely depends on the employee’s work and responsibilities. The Performance Management System developed by RSI Concepts has the configuration level settings to change the number of peers or raters. Once the raters are being shortlisted then a questionnaire should be prepared by keeping in mind to generate enough data to help to build comprehensive reports. Some businesses and organizations also use online mediums to conduct surveys for 360 Degree Feedback. Once getting all of the expected feedback, a report has been produced. After that report, the line managers can hold a session to discuss the report and performance to find out methods and ways to improve performance further as and how assessed and required.

Appraisal Method 3: Behaviorally Anchored Rating Scale

Appraisal Method 3 Behaviorally Anchored Rating Scale

Get line manager response in a YES and NO fashion. Quick and Precise!

The behaviorally anchored rating scale is designed to include behaviour related ratings in the appraisal process. Usually, particular behaviours are denoted with a numeric value and then the value is being used for the rating process. The behaviorally anchored rating scale or BARS is widely used to incorporate quantitative and qualitative ratings in the appraisal process. It is very important that all the behaviours that need to be assessed are carefully listed and then graded to ensure highly accurate appraisal results. Usually, a number of outcomes are listed then the possibilities of incident and behaviour has been analyzed which can produce those outcomes. Then we can create scales, grades or indicators on the basis of this analysis. This is how behaviorally anchored rating scales are defined and measured. The BARS results are very accurate and reliable, the data can be used for the appraisal process as well as for estimating employee efficiency and productivity for the future under particular circumstances.

In the Employee Performance System developed by RSI Concepts, the Behaviorally Anchored Rating Scales are influenced by the standards provided by the Government of UAE, Dubai and Sharjah. A set of Behavioral Competencies are defined and divided into the main categories and while each category further has 3 to 4 subcategories where each employee can be assessed on a scale of 1 to 5 where 5 is the best. The ratings are then incorporated into Performance Appraisal periodically.

The behaviorally anchored rating scale is very easy to understand and accurate to help organizations and businesses to understand the behaviour of their employees which could help the management to take accurate decisions to ensure maximum utilization of the skills, experience and capabilities of a particular employee. The BARS completely eliminate the irrelevant variables from the equation and only provide measurable, accurate results based upon clearly observable behaviours. This is what makes them very important and useful for performance management systems and the employee appraisal process. However, if you want to incorporate BARS into your appraisal rating program then you should have to do intensive research to ensure you will get accurate and actionable data. The behaviorally anchored rating scales are expensive, require more resources and efforts, but provide excellent data.

See More: How a KPI Software can help provide better Customer Journey?

Appraisal Method 4: Straight Ranking Appraisals

Appraisal Method 4 Straight Ranking Appraisals

Get employees ranking compared with each other.

Straight Ranking Appraisals are very straightforward and simple. In this method, the line manager assigns a rating or number to all the employees working on a particular task under the same conditions. Most of the time the reviewer defines the ranking or scale on the basis of the top performers or on the basis of their personal experience or by the knowhow of the job. There are a few more variations that were being introduced later and are also followed by many organizations and businesses. The straight ranking is among the oldest and simplest appraisal methods still being used. Usually, all the employees are compared with one another and a ranking system is being established based on the ratings of most productive to least productive or most efficient to least efficient and so on.

Furthermore, the straight ranking appraisal has been transformed into more appraisal methods such as paired comparison appraisal, in that method the employees are divided into groups and then their performance is compared to each other. Another popular method is the standard rating scale method in this method the personality traits of an employee has been rated against a scale ranging from poor to excellent or as such.

See More: How Performance Management System helps in Customer Journey improvement?

Appraisal Method 5: Human Resource Accounting Appraisal

Appraisal Method 5 Human Resource Accounting Appraisal

Get the money earned vs money yielded.

The human resource accounting appraisal measures the performance of the employees on the basis of the monetary benefits they have yielded for the organization against the expenses they had cost to the organization. The cost is measured accurately by calculating the cost of retaining a customer, their salary, benefits, hiring cost, any other cost and then the monetary value of the benefits or work is calculated as per the predefined criteria and measurements to measure the monetary benefits an employee brought in for the business over a predefined span of time. The human resource cost accounting appraisal method includes the overall departmental cost, production unit cost, office cost, employee cost, interpersonal relationship cost, and many more. Basically, it is a purely cost and benefits based analysis, so sometimes, some employee’s trait or expertise could be missed out or not included in the appraisal process. But this can overcome by using other appraisal techniques in parallel.

The biggest advantage of using this appraisal method is that it provides a very accurate picture of what an employee is costing a business and in return what they are bringing back to the organization or business. It also clearly identifies and project the financial impact of the employee performance over the organization. It is an excellent method to understand the monetary and non-monetary benefits an employee is providing to the business.

See More: Employee Performance Management is a small part of Performance Management System

Appraisal Method 6: Assessment Center Appraisal Method

Appraisal Method 6 Assessment Center Appraisal Method

Get employees to see how others observe them.

The assessment centre appraisal method is most widely used by business to evaluate and assess the technical expertise, skills and performance of an employee for either recruiting purposes or for promotion, transfer, etc or for identifying the training needs for the employee. Assessment centres are specifically designed to assess and review certain tasks and certain job roles. Usually, the assessment centres are outsourced but even if a business has an in-house assessment centre they will have to prepare it with required planning to ensure an accurate outcome. All the employees are being given the tasks they will have to perform for a particular job, then a team of assessors will monitor the actual performance of the employee and on the basis of that performance, it is easier for the business and organizations to make hiring decisions, or decision about an existing employee such as their promotion, salary increment, job role and position, and training needs.

Assessment centres are one of the most widely used appraisal methods with excellent help for the HR department and remarkably accurate assessment results. The assessment centres can be very helpful in performance appraisal reviews and employee assessment. The assessment centres are designed for testing the physical skills and expertise of an employee. For the employees who have failed the assessment, the business and organizations are continuously offering development program to regain their motivation and to encourage them to improve their skills, that kind of setup is called development centres, there is a combination of both the development centres and the assessment centers can be used to ensure the improved human resource in future. Although this method is time-consuming and cost-intensive but provides greater results for industries such as Manufacturing, Educational institutes and Service based departments.

See More: What are the Different Types of Queue Management System?

Conclusion

The Performance Management System is used to achieve the goals and objectives of the organization to maximize efficiency and profits. Performance Appraisal is one of the factors which is designed to improve the work environment and employees and their capabilities and work efficiency within Performance Management. The different methods of performance appraisals are designed to help different requirements and challenges organizations face during periodical appraisals. The appraisals methods covered in this blog are prominently used in Sharjah, Dubai and UAE. These methods are widely used because they can provide highly accurate data which can help organizations and businesses to understand the true potential of an employee to contribute to the organizational goals and objectives. When an employee is placed on a job role where they can perform well, it improves their morale and it increases the employee retention rate. When an employee is working efficiently the operational cost get reduced. Not only that the appraisal systems are also used to identify the training needs for the employees as well.

RSI Concepts has a leading Employee Performance Management System in Dubai and UAE with effective and widely used appraisal methods. Please get in touch with our business consultants through our Contact Us page or leave a comment below and we will get back to you at the earliest to learn more about your requirements. Our Performance Management consultants can help you propose a solution according to the industry requirements to streamline the challenges.

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