How to Measure and Improve Employee Performance?

To excel in life, what matters the most is performance. Performances which are upto the mark are always appreciated. But maintaining the same level of performance always does not turn up successfully. Then the couple of questions arise like, why productivity is low? What are the loopholes in performance? So to answer such sort of questions and to fill the bridge between current and expected performance, two points which are taken into consideration are:

  • How to Measure Employee Performance?
  • How to Improve Employee Performance?

Firstly to elaborate, Employee performance is referred to how an employee fulfills their job duties and executes their required tasks. It involves the effectiveness, quality, and efficiency of their output.

Importance of Assessing Employee Performance

  1. Every employee’s individual performance influences how all the team or maybe the firm (especially if it’s small) is doing. Hence assessing the performance shows them the clear picture of their standard of output.\
  2. It clarifies the employee’s role and status in the organization. Some employees are always curious to know regarding their stand. So assessing job performance clarifies their status and needs to the company.
  3. Self-development is the most important benefit for the employee performance appraisal as it allows receiving positive feedback as well as identifying areas for improvement. An employee can discuss and even create a developmental (training) plan with the manager so he/she can improve his skills.
  4. Performance appraisal system also helps the management in deciding about the promotions, transfers and rewards of the employee.
  5. It is easy to identify the under-performers and decide whether companies want to keep them hoping for improvement or sometimes have to let them go.

Process of Assessing Employee Performance

Step 1 – Establish Performance Expectations and Standards

The process assessing employee performance begins with the establishment of per­formance standards. The managers must determine what outputs, accomplishments and skills will be evaluated. These standards should be relevant to job analysis and job descriptions. These performance standards should also be clear and objective to be understood and measured and should not be articulated in vague manner.

Step 2 – Communicating the Standards

Once the performance standards are established, this needs to be thoroughly and clearly communicated to the respective employees so that they come to know what is expected of them.

Step 3 – Measure Actual Performance

In this stage, the actual performance of the employee is measured during the specified period of time. It is an endless process which involves monitoring the performance throughout the year. This stage requires the careful selection of the right techniques of measurement, taking care that personal bias doesn’t affect the outcome of the process.

Step 4 – Compare Actual Performance with Standards

In this step, the actual performance is compared with the desired or the standard performance. The comparison tells the deviations within the performance of the employees from the standards set. The result can show the actual performance being more than the desired performance or, the actual performance being less than the desired performance. If the desired performance is not upto the mark, it proceeds to the fifth step in the process, i.e., the discussion of the appraisal with the concerned employees.

Step 5 – Discuss the Appraisal with the Employee

The fifth step within the appraisal process is to communi­cate to and discuss with the employees the results of the appraisal. This is the most challenging task that a manager faces when they need to present an accurate appraisal to the employees and then make them accept the appraisal in a constructive manner. A discussion on appraisal enables employees to understand their strengths and weaknesses. This has, in turn, impact on their future performance. The impact could be positive or negative depending upon how the appraisal is presented and discussed with the employees.

Step 6 – Initiate Corrective Action

This is the final stage in the process. Initiating some effective corrective measures should be executed according to the results of the appraisal.

How to Measure Employee Performance?

Here are a few ways to measure and evaluate employee performance:

1. Graphic Rating Scales

A typical graphic scale uses sequential numbers, such as 1 to 5, or 1 to 10, to rate an employee’s relative performance in specific areas. Scales are often used to rate behavioral elements, such as “understands job tasks” or “participates in decision-making.” Or they could note the frequency an employee performs a certain task or behavior, such as “always,” “frequently,” “occasionally,” or “never” coming to work on time. You can adapt scales to your business needs.

2. 360-degree Feedback

This well-named system takes into account the feedback, opinions and assessments of an employee’s performance from the circle of people in the company with whom they work. It can include co-workers, supervisors and others. As this evaluation includes the input from many sources, one can note positive and negative similarities and trends and can also identify areas that may need additional measurements and support.

3. Self-Evaluation

Asking an employee to evaluate his/her own performance can be very effective. Often, employees may be more critical of their performance than you might be. A form that includes multiple-choice answers, essay-type answers, or a combination of the two. Comparing self-evaluation to measure own objective appraisal can be helpful in finding similarities and discrepancies along with a richer understanding of employee’s performance. It can generate conversations that can be beneficial to employee development.

4. Management by Objectives (MBO)

Also known as “Management by Objectives,” this is a process whereby employees and managers form objectives together. They jointly determine individual objectives, how they align with company goals, and how performance will be measured and evaluated. MBO gives employees a transparent understanding of what’s expected and allows them to participate within the process, which fosters better communication and increases motivation.

5. Checklists

Using a simple “yes-no” checklist is a quick and easy way to identify employees that have deficiencies in various performance areas. It will also identify those that need additional training and knowledge to become more efficient.

How to Improve Employee Performance?

1. Understand the Reasons Behind Poor Performance

Employees don’t truly understand the company vision or how their job contributes to its achievement, or employees don’t have measurable performance goals, so they don’t even realize they aren’t performing well enough. Understanding the causes behind poor performance (and even average performance) is a critical first step toward improving employee performance which can be resolved and improved through a healthy conversation.

2. Prioritize Employee Development

At a certain good time to readdress employee goals and plan accordingly to benefit the organizational goals improve employee performance. Working closely to bridge any skills gaps will not only help them achieve long-term goals but will also benefit the company as when employee skills improve it fulfills business objectives.

3. Improving Morale

Boosting morale of the employees with recognition, or celebrating their success or special days. Even sometimes with few monetary perks improvise the employee performance.

4. Empower Employees

For effective results in work, what is most important is that employees must have belongingness and authority that can be gained when an employee is duly empowered and has sufficient amount of freedom and space to work.

5. Utilize the Right Technologies

Implement technology platforms that drive performance and engagement daily. Technology is crucial in today’s workforce, as it reduces stress and saves time. Tech-savvy approach always fascinates employees to work more effectively.

6. Continual Communication

Essence of communication is to understand. Hence more communication means better understanding towards a company’s core value resulting in improvement of work standards.

7. Foster a Positive Work Environment

Happy employees always come up with happy results and to make employees happy what is utmost important is a positive work environment. Inculcating such culture never disappoints the staff and their productivity.

8. Don’t Micro-manage

Micromanagement is a management style whereby a manager closely observes and controls or reminds the work of his/her subordinates or employees. In this manager control every part of a situation, project, etc., even including the very small details, in a way that may not be necessary and may not give enough responsibility to the employees which involves avoiding delegation, constantly making reports, not allowed to make decisions and can’t pass on their skills or knowledge which makes routine work and culture very sofocative and full of congestion so avoiding this practice gives more space to employees to perform both efficiently and effectively.

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