The one positive thing recession has done for organizations is shifting the focus to what really matters when analyzing employee performance.
“I think Steve is a great guy.” doesn’t work anymore. It has to be “Look at John’s sales performance report. It says he is doing great job.”
Consider the case of three managers in the same department of an organization in Year 2007. The performance of the teams of these managers was at par with marginal differences.
Manager A: Ram is one of the youngest managers and hails from Generation Y. He is very optimistic and looks for positive side of the employees. He believes in motivating by carrots.
Manager B: Sonia is in the middle of her career. She has high career prospects in the company and looking for promotion in 1-2 years. She likes to play safe.
Manager C: Johnson is an ex-government employee. For him discipline and loyalty come foremost. He cannot tolerate any deviation from policies and authorities. He believes in the stick.
Here are the scores given by each of them to their team members on the scale 1- 10:
Johnson Name Scores Name Scores Name Scores Meera 10 Amar 5 Mohan 7 Scott 7 Steve 6 Lada 6 Sunil 8 Phillips 5 Harris 5 Tim 6 Lacey 7 Adam 4 Nita 9 Edwards 5 Mike 6 Peterson 6 Mary 6 Jackson 4 John 5 Kate 7 Reema 5 Rob 7 Seema 6 Sheela 4 Mukesh 8 Peter 8 Lucy 5 Sarah 9 Ramesh 5 Olang 7
If HR looks at the employee scores and rank performance according to the scores obtained in the appraisals, the following picture will emerge:
Top Performers Mediocre Performers Bottom Performers Meera 10 Rob 7 Lucy 5 Nita 9 Scott 7 Reema 5 Sarah 9 Lada 6 Harris 5 Mukesh 8 Peterson 6 John 5 Peter 8 Seema 6 Edwards 5 Sunil 8 Tim 6 Phillips 5 Mohan 7 Mike 6 Ramesh 5 Olang 7 Steve 6 Adam 4 Kate 7 Mary 6 Sheela 4 Lacey 7 Amar 5 Jackson 4
Inferences that can be drawn from the above table are:
- Most of the top performers are from Ram’s Team.
- Most of the bottom performers are from Johnson’s Team.
- The best of Sonia and Johnson are nowhere near Ram’s team members.
- Ram has no bottom performer.
The questions that arise?
- Is Ram performing because he has got all top performers?
- Is Johnson such an effective manager that he can drive results even with mediocre and bottom performers?
The above table clearly shows that using the “performance appraisal scores as it is” doesn’t provide accurate information about an employee’s performance. It also indicates that there are personal biases/ nuances in the scores. It will, thus, not be prudent to plan succession, compensation and more importantly “Firing Decisions” based on these numbers. What’s Next?
There are two processes that can help remove the personal biases from appraisal scores: Normalization of Appraisal Scores and Relative Grading. Read more about Normalization of Appraisal Scores in a White Paper by Maj Gen Bhatia.
Read this blog to quickly complete employee evaluation.