HR Globe

The Hindu Business Line - 3rd April 2007

Appraisals, salary hikes, promotions... March has now become the most eventful month in an employee's life at work. While appraisals are still a dreaded exercise in a large number of companies because of the lack of systems and processes and the impending effect like exits, there are a handful of organisations that have managed to get out of the 360-degree feedback routine. They have, for instance, become more flexible and more democratic, and don't treat appraisals as mere rating exercises. Commenting on how appraisals have changed in the last five years, Sunder Ramachandran, Partner, WCH Training Solutions, a Delhi-based soft skills training company, says that performance appraisals have gained more acceptability in the last five years. "Earlier appraisals were seen as a tool only used by large organisations, today performance appraisals are increasingly being used by a lot of small and medium size enterprises."

Democratic process

Typically, appraisals are seen as an annual activity, but Ramachandran says that most organisations are now waking up to the need for appraising employees more frequently. So it's common now to see organisations following smaller appraisal cycles like, say, half-yearly or even quarterly. All 1,250 employees at Bangalore-based Tavant Technologies, for instance, are given a monthly one-on-one that gives a snapshot/review and feedback on their performance thus giving time and room for mid-course correction. This monthly feedback is done using templates where managers enter the required information. Apart from this, the company also has a six-monthly feedback that is done online. "This kind of regular feedback helps as employees are clear about where they are headed, rather than keeping them in the dark for 12 months," says Srini Vudumula, Vice-President, HR, Tavant Technologies.

Appraisals have also evolved to become democratic processes in quite a few companies. Sungard Offshore Services, for instance, follows the employee pick process where employees can choose a colleague to sit through his/her appraisal process to give the appraisers a different perspective of the employee's performance. Akila Krishnakumar, CEO, Sungard, says that this system brings more value to the discussion room. The employee pick is seen as an honest broker. Though he or she does not directly rate the employee, he or she could give a view that could change the way the employee is evaluated or assessed. "Employees also feel that it gives them visibility and recognition in the organisation, an idea of where they stand, not just within the team, but also in the entire organisation." For instance, an employee who's choosing the CEO as the `honest broker' may be looking for recognition from the top management, but should be prepared for the fact that his or her performance will be open for viewing by the top management.

Sungard has 1,200 employees in India and about 50 per cent of them opt for this programme every year. Some employees (about two-three per cent) have even opted to bring in their customers to sit through the appraisal process. Though seen as a revolutionary step, employees feel sometimes customers are able to give better feedback as they are constantly working with them, says Akila Krishnakumar.

External consultants

On the use of external consultants in appraisals, Ramachandran says they do play a critical role as they bring in a sense of objectivity as well as an unbiased approach. Companies use external consultants for primarily two roles: One is for the technology support, i.e., to provide an online performance appraisal tool that can be used by all employees across the board. This creates transparency and also makes it easy for the top management to track the entire process easily.

The second is as a facilitative mechanism where consultants are also used to interface with employees and management and bring out a consensus. As outsiders, employees often tend to trust external consultants and end up sharing a lot more with them vis-à-vis their immediate boss.

Both companies and employees are also realising that appraisals mean more than salary hikes and promotions now. "When employees realise their strengths and weaknesses early in the year, they can opt for training programmes that help strengthen some of their weak points," points out Vudumula of Tavant .

Akila Krishnakumar says that appraisals help employees develop career maps and domain training modules. At Tavant too, changes in training needs are analysed early on because of the monthly feedback. In fact, apart from regular training, workshops are conducted two months before the appraisals. The company also sets core values and defines the expected behaviour. Each manager gives feedback showing actual behaviour against expected behaviour. This is done in the areas of customer orientation, teamwork, communication and so on. Newer appraisal systems are also pointing to the fact that performance management is not just about numbers and salary hikes. Vudumula says that at Tavant they teach managers not just about what goals to achieve, but also about how to reach them. "We can't have performers walking over dead bodies just to show results." This, he feels, helps in achieving a long-term goal, i.e. in building the company culture and in developing future leaders.

Do employees plan their exits just after appraisals? Ramachandran's view is that appraisals are often the only occasion when supervisors take the time out to give systematic feedback to their teams. As a result, a lot of skeletons come out during this period. "People leave for a wide variety of reasons like - not liking the feedback given by the boss, lack of direction about their career paths, lack of objectivity, instances of favouritism," he says.

Development initiative

Ramachandran, who has worked with companies in the BFSI, retail and real estate sectors has a few suggestions to employees: Look at appraisals as an opportunity to reflect on your performance. Your peers, clients and supervisors could give you critical feedback that can help you move up the organisational ladder faster. Don't become myopic and try to analyse `areas of opportunities' and `strengths' as stated by your boss. Work on these and the monetary incentives and promotions will follow.

He also has a bit of advice for employers: Position appraisals as a learning and development initiative rather than a reward and recognition initiative. The concept of appraising employees is to give them constructive feedback about their performance so that they come up the learning curve and grow in their careers. If monetary rewards and promotions become the sole outcomes, then employees are only interested in the outcome rather than the process of performance appraisals.