Comparing Performance Appraisal Systems Across Sectors: What Can We Learn?

Dear all, I would like to know about the performance appraisal systems in two companies from different sectors.

Thanks and Regards,
Alankrita

I appreciate your help. I need an analysis of the difference between the types of appraisal systems used in two sectors. This is a project I am working on.

Regards,
Alankrita

Types of Performance Appraisal Systems

Irrespective of companies, the Performance Appraisal Systems are broadly of two types: (i) Goals/KRAs based and (ii) Competencies/skills based. Some companies have a mix of the two by allocating weights to each. For example, Goals/KRAs may carry 60% weight, and the Competencies/skills may have the balance of 40%. The distribution of weights may differ as per employee level. For example, in the case of Managers, Goals/KRAs may have an 80% weight, and for their subordinates, it could be only 40%. The reason for this is 'employee development'. Development plans are based on competencies/skill gaps, and there is a greater need to focus on the same for employees with lesser experience. The senior employees are fairly developed, and it is time that they deliver as per goals.

Hope this gives you a fair idea, Alankrita, about the basis of the design of performance appraisal systems. This is just an introduction since the full design is a complex process, involving an interplay of many variables and is based solely on the maturity of HR processes of an organization.

Regards

Hi Alankrita, I do not have many details as I only have the information shared with me during the interview. Hopefully, you can investigate further. I visited a company in the consulting industry. They specialize in market and financial consultation and have a global presence, being a well-known name in the market.

They Follow a 360-Degree Appraisal Process:

360-Degree Feedback is a system in which employees receive confidential, anonymous feedback from their colleagues, including their manager, peers, and direct reports. Some even gather feedback from their customers.

Using a 360-degree feedback system for performance appraisal is common but not always advisable. Structuring a 360 feedback process that builds trust when used to measure performance can be challenging. Additionally, 360 feedback mainly focuses on behaviors and competencies rather than basic skills, job requirements, and performance objectives, which are typically addressed during an annual review and performance appraisal. Incorporating 360 feedback into a broader performance management process can be beneficial with clear communication on its purpose.

What a 360 Feedback Survey Measures:

- 360 feedback assesses behaviors and competencies.
- Provides feedback on how others perceive an employee.
- Addresses skills like listening, planning, and goal-setting.
- Focuses on subjective areas such as teamwork, character, and leadership effectiveness.

What 360 Feedback Surveys Do Not Assess:

- Does not measure employee performance objectives (MBOs).
- Not a way to determine if an employee meets basic job requirements.
- Not focused on basic technical or job-specific skills.
- Should not be used to measure objective things like attendance or sales quotas.

Please review the following link as well: http://www.psychtesting.org.uk/downl...16F322&ext=pdf

Regards,

Thank you all for your guidance. However, I am already aware of the types of methodologies used. I am now interested in learning about the system and method of performance appraisal that a company is currently using in real-time.

Regards,
Alankrita

Hi Alankrita,

As far as the process is concerned, each organization has peculiar ways. The firm I talked about used this approach: They have a questionnaire designed for performance evaluation. The forms are given to the appraisee (employee) for self-evaluation and to his/her immediate supervisor for evaluation.

Usually, an employee is allowed to recommend 2-3 of his peers (teammates), 2-3 customers (if any), and likewise. The HR can then choose from his/her end whom to ask for evaluation.

Feedback is brought together and collated for every individual based on the group or set of people who evaluated them. They use a database handling mechanism.

Once the data is collated, all the ratings are put forward (please note the questionnaire is designed so that ratings are taken and feedback is collected), and an average rating is given.

Then there is a one-to-one meeting (employee, his supervisor, and the HR) where feedback is shared constructively, and employees are asked again how they would rate their performance.

After a detailed meeting and revision of ratings, there is an option of distributing the people by giving them percentiles. This is known as normal distribution.

I hope this answers your question.

@MyHrSoft

From the query, she does not need software or a tool to help her with performance appraisals for her people. It's a project she's working on, perhaps academic. Please comment if you could add to her knowledge. You already asked her to contact you in case she needs your tool. Do not be too desperate to advertise yourself as this is a knowledge-sharing forum. If there is something you wish to answer her personally, I would suggest kindly advising it on this open forum so that we all can learn and grow simultaneously.

Please do not misunderstand me, but when the thread grows, it becomes a little confusing when we see posts with practically no knowledge in them posted again and again. Hope you understand.

Regards