Business Scaling

8 Reasons To Invest In Performance Reviews

8 Reasons To Invest In Performance Reviews
Every organization aims to become the best in its field. Say you have superior products and services, an excellent positioning, and branding that suits you well. But there are other things to improve internally because the best brands are crafted from the inside out. 

Why Investing In Your Talents Are Way More Important Than You Think

Employees are valuable assets of an organization. With the help of an effective management system, they can ace organizational goals and eventually, influence the corporate culture. Cultivating the employee-management relationship can make a huge impact on organizational processes. As well as brand image, and even define its future state. 

The management conducts regular Performance Evaluations on employees. It is an assessment that aims to go through employees’ work conduct within a certain time frame. It can help define their strengths and weaknesses and the aspects that deserve a reward or further improvement.

Conducting performance evaluations is the norm for some companies. Today, others shifted to casual assessments and rely on feedback mechanisms to improve work performance. But these can overlook specific issues in the organization. A formal performance evaluation holds documented and organized data to improve employees, the management, and the brand as a whole. 

Here are eight more reasons to invest in performance evaluations:

1. Pinpoint Where the Problem Lies

Performance evaluations are carefully done on every employee. Their cases are diverse. Some are exceptional and deserve compensation, and others are achieving the standard, while a handful may have difficulty complying. But the reasons for these also vary. Data collection through proper assessment should be done to evaluate the situation fairly. 

Say you adopted a new strategy or approach in the workplace. The team has been underperforming for a while, taking a toll on your operations. But it does not always mean that they are incompetent. There might be other causes you missed to spot. 

With the help of a performance evaluation and workforce analytics, it was identified that they have a collective experience on the new strategy. The data collected shows that they have struggled to adapt due to a lack of knowledge. Therefore, addressing the learning curve and providing enough training for this new process will improve the situation. 

According to Mark Huselid, the Center for Workforce Analytics director, "We need to let our strategy dictate the metrics we adopt. We've got to focus on the data that we need and not the data that we have."

2. Help Turn Weaknesses into Strengths

Initiating discussions with your employees can make them comfortable enough to voice their thoughts. While this can enhance your connection, it can also break down barriers. Healthy communication can ease tension and effectively discuss concerns. 

During performance evaluations, identifying employees’ weaknesses is essential. It will demand better work performance from the employee to achieve organizational needs. But in the end, it’s more valuable to correct them and turn them into their strengths. 

According to Wharton professor Adam Grant, “When it comes to assessing our talents, we’re full of blind spots. If you can see yourself through the eyes of others, your vision will become less blurry.”

While this applies to recognizing our strengths from another perspective, seeing your weaknesses the same way may help overcome them. Employees might have stated their weaknesses in resumes or mentioned in interviews, but some can still appear in new situations. Performance evaluations can be a form of a mirror for employees to see their strengths. Most importantly, to recognize weaknesses and be able to work on them. 

3. Improve your Business Reputation

Employee experience reflects company culture and its processes. A way to improve the working environment is to assess the gaps between employees and the management. Especially pay close attention to employee feedback and experience. 

Performance reviews can reveal the underlying struggles of your employees. While it can help to spot mistakes– so they can correct them– support from the management would be much appreciated. Showing your employees that you care for their personal development can increase your reputation. 

Provide development programs and training; give education opportunities; encourage personal growth. Allowing them to improve their skills can help them overcome their struggles and also gain a competent employee on your behalf. Let your employees speak for you. It radiates in and out of the workplace when they are treated well. 

4. Improve Your Future Hiring Process

We conduct our performance reviews each year, a month before the employee’s anniversary in the company. But it varies per organization, and some may do it earlier or later than the other. The data collected during these assessments are carefully examined to help with the company’s future decisions. And one of these is the improvement of the recruitment process. 

The employee's performance reflects the success or failure of the current recruitment process. This can be identified through appraisal data. Were the employees hired several years ago performing well? Do they display a need to improve the hiring process?

Data-driven hiring eliminates human errors and displays variables that fit your company’s needs. Appraisal data and other forms of data available can shape your hiring process-- a way of preventing problems before they occur. Finding and hiring the right people for the position can help you reduce future costs and possible liabilities. 

5.Secure Goal Tracking and Achievement 

When it comes to employee-management relationships, monitoring and feedback are essential. It is crucial to recognize their efforts to inspire them to do better on the employee's end. This connection also creates space to discuss their personal and the organization's goals.

In a performance evaluation, there is a chance to clarify the organization’s goals that the employee must achieve. The manager should lay it out clearly. And track its achievement over time. Not only does it show concern, but it also prevents course correction along the way.

According to Prof. Lakshmi Murthy, Chief People Officer, ITM Group of Institution, “The tracking at all levels ensures that the organization's goals are achieved. The feedback should be factual and objective, and there should be dedicated time assigned to the discussion.”

Individual goals are as important as organizational goals. Its maximum achievement depends on the amount of effort given to it. A performance evaluation keeps both goals on track and identifies needed improvement or recognition of a job well done.

6. Protect You from Lawsuits on Wrongful Termination

Lawsuits are expensive to settle and can tarnish the company’s reputation. One of the most common civil lawsuits is wrongful termination. Ex-employees have the right to file such if proven that there has been a discrepancy in their termination process. However, in some cases, the company lacks the evidence to defend itself in times of accusation.

Performance reviews can save you from such a burden. According to Zoe Bekas, “Performance evaluations are particularly effective in legitimizing the employer’s stated reason for termination if the evaluations showed a decline in performance over time and culminated in termination.” 

As an employer, it is your responsibility to treat everyone fairly and uphold their rights. It is essential to make the session objective during the evaluation, with open communication and consistency with all employees. And to move away from possible accusations in the future. The data collected can be evidence to protect your reputation or put you behind bars. Its legitimacy will stem from you and possibly dictate the company’s future. 

7. Feedback Helps Build Relationships

Just as each individual has a different learning style, employees cope and learn in a workplace in their own way. Some are assertive and open to feedback as a way to develop themselves, while some take feedback negatively. Either way, you generally get the most--and the best--feedback from people who work closely with you.

That's because the more you get to know someone, and the closer your working relationship becomes, the easier it is for them to tell you the truth. Good, open relationships develop when people feel comfortable telling each other what they really think. In a great work relationship, the person receiving feedback doesn't see it as criticism or an attack.

Instead, they see it as a gift--someone is helping them out.

The person giving the feedback protects them, making sure they don't continue doing something that "is in their blind spot." Meaning it is something that others see, but you don't realize that you're doing it.

A process for delivering feedback ensures your team can develop these close relationships, and everyone feels comfortable giving and receiving feedback.

8. Feedback Improves the Way We Listen

Any feedback starts with listening from both sides, as communication is a two-way street. Good feedback demands that the person receiving it is open and engaged with the process. And that means listening to the feedback in a specific manner.

There are two kinds of listening: passive and reflective.

Passive listening essentially means you're only listening to someone else to set up your next point. You're hearing what they're saying, but in your head, you're trying to decide how you'll counter it or use it to build your position.

Reflective listening is much different. In this type of listening, the person receiving feedback is open enough to information to give it a chance to change its mind. If they hear a compelling argument, they can be swayed. They aren't so locked into their own opinion that they dismiss or manipulate what they hear.

Reflective listening is what everyone in your company should be striving for when they get feedback. No getting defensive or making excuses. Just an open acceptance of--and reflection on--what's being offered. The more you encourage listening and feedback, the more your team improves.

The Long-Term Impact

Performance evaluations provide benefits for both employees and the organization. But more than an assessment, it can also be a powerful tool to hone organizational culture.

Employees are one of the most critical drivers of your business. But to maintain and continuously acquire the best of them, you should consider the organization's culture. According to a 2019 report from Hired, 45% of applicants consider organizational culture the number 1 factor in accepting job offers. 

Today, more of them look at companies to reflect their working environment-- the more robust the culture is, the more attractive it can be. It shows that the management and the employees have healthy working relations, open for collaboration, and demonstrate value on employee development. 

Regularly conducting performance reviews; can help identify unhealthy work practices, continue and reward good habits, and improve employee competence. Thus, shaping a robust organizational culture with reduced employee turnover and a higher success rate. 

MultiplyMii’s Performance Appraisal 

At MultiplyMii, employees’ performance is closely looked upon. This careful evaluation ensures top-quality performance among them. These performance reviews are done quarterly and annually. And according to competency expectations set by the company and the client that the employee is assigned to. 

External multipliers are assessed objectively. Information comes from MultiplyMii managers and feedback from clients. Performance is measured according to a rating scale system. A higher score indicates eligibility to merit increase, while a lower score can equate to specific development programs. We aim for the maximum efficiency of our multipliers. To provide bespoke staffing solutions, performance review from clients is a valuable part of our assessment. 

At MultiplyMii, performance reviews make way for employee development and client satisfaction. More than an assessment, it aims to help with clients’ decision-making. And to provide the best way to improve the quality of the workplace.  

Final Words

People from different cultures, beliefs, and backgrounds are joined together to achieve the goals of an organization. It is part of the management's responsibility to guide them towards a single vision while creating space for personal development. On the other hand, it is employees’ responsibility to reach the required work performance that needs to be carried out.

Employees are your biggest asset. Day by day, they make your visions come to life, keep your company established, and can be a determinant of your future. Investing in your employees’ development goes a long way. 

Conducting performance evaluations should not solely equate to weeding out poor-performing employees. Or a stressful assessment that pressures both employees and management. It should be seen as an investment for both ends, especially for the organization. 

Your employees reflect your culture and reputation. Cultivate their skills and see positive changes in the workplace.  

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