Are Annual Appraisals Better? Seeking Insights on Shifting from Quarterly Reviews

Currently, I am working with a mid-size IT company in Chennai. Here, performance appraisal is done every quarter, i.e., employees who join in the first quarter of 2012 will have their appraisal done in the first quarter of the following year (2013), and similarly for the remaining quarters.

Due to this existing appraisal process, most of our business heads feel that they are wasting valuable time evaluating and reviewing their team members' appraisal forms.

I kindly request your suggestions on this matter. I am considering moving to an annual appraisal system. Before presenting this to management, I would like to understand the benefits of annual appraisals and the disadvantages of quarterly appraisals.

Please offer your perspective broadly so that I can prepare a comprehensive report to submit.

I appreciate your insights on this matter.

Annual Appraisal System: A Consistent Approach

In most companies, the appraisal is conducted on a yearly basis, i.e., a rotational basis. If an employee joined on 2nd Feb 2012, their appraisal would be conducted on 2nd Feb 2013, and so forth. This approach provides time for the team lead or HR to monitor, coach, guide, and evaluate the employee based on their performance.

It needs to be consistent and hassle-free so that everyone can remember when it will happen and prepare themselves.

There is an alternative system which has two months during which the annual appraisals happen in a year, say April and October. Employees who joined from April to the end of September this year will have their appraisals in the next year in April. Those who joined in October and March of this year will have their appraisals in the next year in October.

Advantages:

- Helps the management in strategic decision-making, budgeting, and thereby cost control.
- This will help the BU/Group heads to have better control and will save a lot of time.

Regards,
Kanchana R

Thank you for your reply. Could you please consider other factors that we could leverage as I mentioned before? We conduct quarterly appraisals. For instance, employees who join in November, December, or January will have their appraisals in January of the following year, close to the end of the financial year. This setup makes it challenging for employees to plan their taxes and results in potential financial losses.

Similarly, I would appreciate it if you could suggest or highlight other small points like this.

Regards,
Rajasekar

I believe it is great that your company has been practicing quarterly appraisals, even though managers find it a hassle. Many companies struggle to implement an annual cycle appraisal system. My suggestion is to maintain these quarterly sessions but to modify or simplify the process into manager-staff feedback sessions. This approach aims to avoid any last-minute surprises that may be challenging to rectify. Additionally, consider including an annual full-blown appraisal.

A word of caution: monitor performance indicators, such as productivity, before and after the program changes. While managers may consider it a hassle, your company's overall performance may benefit, and your employees may become more engaged.

Regards,
Autumn Jane

First of all, leaving behind the quarterly appraisal model and moving to an annual appraisal is one of the best things you can do. A good number of companies in India conduct annual appraisals. Without any doubt, it is a convenient and easy model.

Advantages of Annual Performance Appraisal

Improved morale and teamwork

Increased job motivation and engagement among employees

Easier to identify areas that need improvement

Enhanced productivity

And much more...

These are the top benefits of annual appraisal. Highlight these points to your management and encourage them to switch to this model at the earliest.

Regards, HROne