The making of best and constructive decisions in regard to the employee management, loyalty and satisfaction has been a challenge to many Human Resource Managers. In the recent past, best policies in regard to people management have certainly started to play a critical role in the growth and development of many business firms and are increasingly becoming popular. The reasons for this are not particularly hard to discern. Human resource forms the most prized asset of an organization and there is need to attach the greatest effort towards their well being for excellent performance. The central theme dominating this course work focuses on the application of performance appraisals in organization that is aimed at achieving employee retention, satisfaction and improved performance.
The dynamics of changing business demographics and consumer purchasing patterns coupled with ever stronger competition for better employee management has increased pressure on business enterprises to undertake performance appraisals. Available literatures point to the fact that performance appraisals relate to business strategy in that they directly influence the choice of priority in business. In addition to the above, performance appraisal forms one of the critical roles of a sales manager in an organization. According to Mishory (2004), “it is a sales manager’s job to evaluate his employees: extolling their strengths, pointing out their mistakes, and offering constructive criticism”
While there are various strategies at the disposal of human resource personnel to attract the best pool of employees and ensure their satisfaction and retention, performance appraisals has been documented to form one of the critical roles in their retention. In addition to the above, performance appraisals are effective in business in a number of ways. First, they form the foundation through which employee loyalty to an organization can be enhanced. Most companies miss out the “important opportunity to gain employees loyalty through the continuous process of performance appraisals” (Mishory, 2004).
Mishory (2004) proceed to stress this point by succinctly stating that “at a time when the sales people are apt to evaluate their career options, companies can increase their retention by meaningfully engaging their salespeople more often”. The process of quality engagement of the employees must involve a deep analysis of the challenges that employees face in the course of their activities. Such critical information can only be obtained through continuous process of performance appraisals.
Second, performance appraisals provide the rare chance for supervisors and subordinates to have quality discussions on issues that surround their daily activities. According Archer North Performance Appraisal System (2010), “Almost universally, where performance appraisal is conducted properly, both supervisors and subordinates have reported the experience as beneficial and positive in that appraisals offers a valuable opportunity to focus on work activities and goals, to identify and correct existing problems, and to encourage better future performance”. Furthermore, performance appraisal is an effective tool for motivation and satisfaction, training and development, recruitment and induction and employee evaluation.
Employee training and development form the most critical components in employee performance. It has been evidenced that performance appraisals the best opportunity for discovery on the areas of training and development that employees require. Archer North Performance Appraisal System (2010) echoes this point by stating that “Performance appraisal offers an excellent opportunity – perhaps the best that will ever occur – for a supervisor and subordinate to recognize and agree upon individual training and development needs.”
This is because such sessions offers the best chances for the presence and absence of work skills and become the cornerstones for employees’ future career aspirations. The overall picture of the data that can be analyzed through variables such as sex, age and department provide the critical components for demand in training.
Employee motivation and satisfaction are also products of performance appraisals. According to Armstrong and Apperlbaum (2003), “If nothing else, the existence of an appraisal program indicates to an employee that the organization is genuinely interested in their individual performance and development and this alone can have a positive influence on the individual’s sense of worth, commitment and belonging”.
These are generally linked to employee retention and loyalty that form the pointers to improved performance. “On the recruitment and induction, performance appraisals provide the critical data to monitor the levels of effectiveness of an organization practices in regard to recruitment and induction in that such data are applicable in monitoring the changes in recruitment strategies (Archer North Performance Appraisal System, 2010).
According to Falcone and Sachs (2007) “By following the yearly data related to new hires (and given sufficient numbers on which to base the analysis) it is possible to assess whether the general quality of the workforce is improving, staying steady, or declining”. Lastly, performance appraisals are critical in the analysis of employee evaluation which remains a legitimate tool for improved performance. Even though it is not clearly spelt out, evaluation remains the major aims of performance appraisals in most organizations.
Performance appraisals can only become effective if they are done at least twice in a year. This is because, according to Mishory (2004), “frequent evaluations not only improve employee performance, it also helps improve the processes of the company as a whole”. The process of annual evaluations can become detrimental to the central goal of employee improved performance in that it coincides with end year reward events. The issues of meaningful conversation therefore get mixed up with other objectives of rewards such as “either you succeeded or you didn’t: you therefore deserve a raise or you do not” (Mishory, 2004).
Supervisors have always stood in the way of frequent performance appraisals. As a manager, the best strategies to make supervisors appreciate the role of frequent performance appraisals is by letting them talk first to have a clear evidence of their concerns and worries. This is important because as a manager, you cannot solve a problem that you do not know. Mishory (2004) illustrates that “people will more critical of themselves than you will be of them.” To retrieve as much information as possible from them, let give a critical analysis of themselves first. In addition to the above, provide a constructive criticism and avoid being destructive by overwhelming supervisors with a list that is not important.
Other effective strategies towards having supervisors appreciate the positive aspects of frequent performance appraisals include focusing on specifics and avoiding handling the concerns of the employees in a general manner and asking what you can do better. This is because evaluations are a two way street in that while their purpose is to help salespeople improve performances, as a manager you can learn critical lessons from such evaluations. In conclusion, performance appraisals have over the years served as a critical component towards employee retention, satisfaction and improvement.
Archer North Performance Appraisal System (2010). Benefits of Appraisal. Web.
Armstrong, S. and Apperlbaum, M. (2003). Stress-Free Performance Appraisals: Turn Your Most Painful Management Duty Into a Powerful Motivational Tool. New York. Career Press.
Falcone, P. and Sachs, T, R. (2007). Productive performance appraisals. Texas. AMACOM Div American Mgmt Assn.
Mishory, J. (2004). Frequency Matters. Journal of Sales and Marketing Management. Vol. 156, no. 7.