Hi Guys,

Its the appraisals time.

Attrition is very meagre at our office...the seniors are becoming even more senior...but the designations are no additional responsibility/ work can be allocated. But the salaries are hiked during annual appraisals every year based on the revenue.

Now the question is inspite of srengthening the sales team interms of man power and salary..we could get very little work this year and can say couldnt even reach break even...its in loss......and yes, appraisals again....iam very confused.......cause i cannot terminate or lay off employees as they are emotionally attached with the company..and are working from quite sometime..and are well trained during bench hours but i cannot hike their salaries according to the market standards as the company is in loss......

How do you think this situation is handled?? coz it is not employees mistake for we have not provided them work....otherwise they all were performing well when provided with work.....

I request all the seniors to please come out with your solutions..

Thanking in anticipation.......



From India, Hyderabad
Dear Sari,
Yes, this is very critical situation and its very hard to handle things.
As you said the employees are very loyal to the company and well trained, first thing you can do is to inform that about the situation. that " Company is not able to reach at break even and we are facing some financial crisis. When these crises will over, company starts performing again you will be appreciated for your work and loyalty to the company"
Note; Don't lay off employees. Also Don't becoming them impatient. Loyal and hardworking employees are assets for the company. Retention for the company doesn't mean that you want to save your money spent on them in past. Its about their presence, loyalty.. These are the things which are more important.
This could be a challenge for .......
Wish you best of luck,
Most of the employees better knows they have business or not.

From Pakistan, Islamabad

Thank you Hassan for your prompt reply..

The worst part is employees are expecting hike irrespective of being aware of the fact about the business situation about the company, after all they have valid, loans..etc etc...this a human side of me........

but if i think only from HR's perspective..the employees are here from quite stagnated with no new ventures....and the man power is more than required....we ending up paying salaries even when they are on bench.... i can get freshers in the mean time with a meagre pay and train them till we get projects.....infact i have seen new joinees are performing better than seniors.. and the old employees got accustomed to this company..take it for granted at discipline or proper etiquettes.....not all that flexible for new policies and changes.......and on top of it THEY DONT LET NEW JOINEES the name of competent ones are not in the right chairs....


From India, Hyderabad
If this would be the case, then just go head. Blast a mail that all employees are under stirct observation and comapny need to be re-structured. Performance of all employees will be monitored.
You may start the action. Because there would't be any compromise on discipline. Things should not be granted.

From Pakistan, Islamabad
Hi Sari,
My views...
If you are appraising sales guys, then you can take the targets and the highest target that has been achieved, then do a forced ranking as per the bell curve and analyze as to how many are your anchor guys, star performers and the bottom performers. Based on your ranking of the employees, select the bottom performers and let them go through a rigorous performance improvement plan.
Ultimately i dont think you might want to retain the non improvers inspite of these efforts. In their place get some freshers, wher your wage cost will reduce.
Gone are the days when HR was just a support function, now even we have the cost savings and earnings in our KRAs and will have to support our performance, specially when the company is in a challenging situation.
Thanks and Regards

From India, Mumbai
Dear Sari,

You need to give some token hike. The way I see it is this -- you need to communicate to all employees when they are having their appraisal meeting that they will get a hike. If someone complains that they have a meagre hike, the following reasons can be cited:

1. The company is not making as much profit as expected

2. You are not performing to your optimum

3. We've been noticing unacceptable behavior from many employees that we are going to deal with separately.

If the HR in your company is strong enough to voice it's opinion, I think you should suggest that hard-working new comers will have to get higher raises.

Ultimately, it is the law of the survivor. The seniors eventually have to move on to other roles in bigger companies and the newer lot needs to breathe in fresh energy.

With this in mind you should devise your strategy. Otherwise your problems are not going to end. They may get compounded.

Don't send a mass mail telling your employees that the company is not doing well. It may lead to unexpected repurcussions. Let the message be subtle yet firm. Eventually the once you are redundant will move on. Meanwhile, you can train freshers to take newer and better responsibilities.



From India, Pune

Thank you Siva for your genuine inputs....Sales team are target based but most of the projects are on the verge....any how we may not hike their salaries till they achieve targets, and they are aware of it.

COming to ranking the employees, the perception is changing with diff iam not a technical person iam forced from the PMs to believe that the few are performing good and the rest as average, but when i had to listen from the employees side they have to say that they are discriminated and are not allowed to grow.....

Thank you SS, it sounds good to sit with them and explain them about why meagre hike..

Iam stuck with raising my opinion about hardworking new guys getting a better hike..coz lot of politics entangled with it. In the last two months two new joinees left the organisation and they are offered double the pay so i couldnt stop them....and made it clear to higher management many times but they are doing very little about a days i see PMs behaving rude and absurd with me....being alone in HR....iam finding it really hard to take it..............

From India, Hyderabad
Hi Sari

I can empathies with you.

I have handled a similar situation a few years back.

The same argument that they had been there with us was an emotional catch. The market is bad , we did not offer them enough jobs was another excuse.

1. We did not offer them enough jobs

Let us compare with organisations who have done very during this period. My only question was if others have done why did we not?

2. They had been with us long

Are you running an charitable institution or a business institution. ? This is what I asked

It took nearly a year and the culture changed.

Some even criticised that I am not a genuine HR person.!!!

HR is not about taking care of all people HR is taking care of Performers

and enable and convert nonperformers as performers. But no organisation can wait indefinitely for training nonperformers. One of my friends used to say "we are not a training organisation" when I used to critisise him for his quick decisions on man power. I did not agree with him then.......and I was in HR then I agreed with him the moment I became head of Operations!!

Well that was my view



From India, Chennai

Thank you once again Mr. Siva, for a very clear picture of taking things..and motivating me.
Iam sure this is not faced only by me, there are many HRs who are struggling to make a change. The change may not be drastic.. as the route cause has much to do with the mindsets of the people and the culture that has been practised....but yes "WE WILL".

From India, Hyderabad
A workshop is being conducted on the subject you are talking about. Please see the attachment, it may be helpful to you. Anand
From India, New Delhi

Attached Files
File Type: pdf performance_appraisal___effective_counselling_201.pdf (70.5 KB, 156 views)

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