Employee performance reviews often have a reputation of being biased and unfair. Simply stated, they are perceived as the total opposite of their primary role and function, namely, an easy way to professional development.
Unfortunately, they have become (and continue to be) a much-disputed part of the employee’s life-cycle within the organization. Statistics from organizations that measure human resource effectiveness show that:
- 45% of Human Resource experts believe that the annual performance review is not an accurate appraisal of the employee’s performance during the year.
- 20% of employees are not convinced that management is able to provide realistic, constructive feedback.
- 58% of global organizations do not believe that the time taken to conduct a performance evaluation has a respectable ROI (Return on Investment).
However, on the other side of the coin, there is also substantial evidence that shows that a correctly conducted employee performance review drives sustainable business growth; thereby, forming an integral part of the employee’s life-cycle within the organization.
The question that needs to be asked by both management and employee is how to ensure that performance reviews based on Key Performance Indicators (KPIs) deliver the intended results; namely, an unbiased, equitable, and impartial way of benchmarking the employee’s performance for a given timeframe. And, ultimately, contributing to a healthy, positive approach to the employee’s personal growth and development within the organization to the benefit of both parties.
By way of answering this question, here are several points that are worth considering:
Project-based employee reviews drive sustainable business growth
Most employee performance review processes are based on the annual (or bi-annual) model. Thus, it does not matter how many projects each person has worked on throughout this period. This business model provides for the scenario where some employees will contribute more to the company’s bottom line than others.
Consequently, these staff members may feel as though their peers are not pulling their weight, and the hard-working, successful individuals might look for other employment where they think their hard work will be better appreciated. This is not an ideal scenario for any organization.
Therefore, it makes sound business sense to change the review process from an annual (or six-monthly) model to a project-based model. Succinctly stated, the KPIs for each member of the team are set up per project. And, the evaluation takes place based on the outcomes of the project rather than on the length of time that the employee has worked for the organization. Employees are rewarded per project and not on an annual or bi-annual basis.
Online employee review model improves the review process
Manual employee review systems consume unnecessary time and resources like paper, printing ink, and reduce the printer’s lifespan. Therefore, it is preferable to utilize an online employee performance review system so that the employee can easily access the pre-defined KPIs and answer the associated questionnaires from anywhere and at any time.
Management (including team leaders) can then go online and comment on the employee’s review of his/her performance. A physical appointment does not need to be scheduled for the employee to meet management to discuss the outcomes of the review.
Realistically, staff and management only need to plan a physical meeting should there be a need for serious issues to be addressed, or if there are questions that require additional clarification and interpretation.
The project-based employee review model increases ROI
The Return on Investment (ROI) is a statistical measurement that attempts to quantify the effectiveness of an expense by calculating the net profit (derived directly and indirectly from the investment) divided by the cost of the investment. In this scenario, the ROI of the implementation of a project-based, online employee review system is measured against the increased profitability levels derived from the implementation of this system.
Simply stated, this ROI calculation attempts to determine whether the cost of the employee review system has improved, and will continue to drive, the organization’s ability to remain profitable.
Therefore, we can see from the above content that the implementation of an online project-based or continuous employee-review model increases productivity through the continual review process. This, in turn, improves the effective management of the employee’s time. And it provides for the early intervention of potential issues that are likely to derail the successful completion of a project.
Finally, improved productivity, higher project completion success rates, and reduced risk of project derailments all drive success for the organization; therefore, resulting in an improved ROI and improved profitability levels, allowing the company to manage and expand its operations successfully.