There is a general feeling that performance appraisals are subjective and that when managers rate their team members, a certain bit of bias seems to creep in.  This thought process leads to un-necessary friction between the managers and employees.

Can we eliminate the subjectivity in performance appraisals by automating the rating?

Sometimes, people ask us if we can automate the rating completely using our software.  So, they expect that the rating should be automatically given based on employee’s performance and pre-defined rating for such performance and managers would not be responsible for rating the performance.

So, can rating automation be a solution to remove the subjectivity in appraisals? In reality, will it be possible to remove the subjectivity element and automate the rating completely, without a manager’s involvement?  This is definitely a point to ponder on.

First, let us understand the parameters or the dimensions which are rated, as part of the performance appraisals.  Generally, there are set of performance dimensions or goals that an employee is required to achieve during the course of a year.  Also, there are a set of behavioral dimensions which an employee needs to exhibit to fulfil these goals.  So, generally, rating is given to both these dimensions, but the weightage may vary between both. 

Problems in automating the rating:

The following are some practical problems that we will face, when we try to automate the rating during a performance appraisal:

1)      Performance dimensions or goals are generally quantifiable.  But, for employees working in some departments, setting SMART goals may be quite a challenging task.  For instance, defining quantifiable goals for a sales department is much easier, than defining goals for people working in a functional team.

2)      Even when goals are quantifiable, setting proper performance measures might be difficult.  This will lead to difficulties in finding out the actual achieved numbers. So the input of the actual achieved numbers (against a target) would be done by a manager or an employee manually and there is bound to be some subjectivity in entering those numbers.

3)      Behavioral dimensions, like communication skills, cannot be quantified. So, automation of rating cannot be considered for rating behavioral dimensions, and so the bias element cannot be totally eliminated.

4)      Even if we consider that automation of rating is possible, the inability to meet the performance target by an employee might be due to various external reasons outside of the control of the employee.  Penalizing a person for this by automating a rating might be too harsh.  Some subjectivity of manager involvement in such cases would be better.

What are the characteristics of effective performance appraisal system?

I am sure all organizations have performance appraisal system set up for evaluating employee performances and for their annual appraisals. But have you looked into the performance appraisal system that you have implemented is effective or not? We come across a lot of performance management and appraisal systems with varied features and high price tags. Organizations should understand that performance appraisal systems with varied features are not always effective. Certain characteristics put together will make an effective performance appraisal system.

Following are the characteristics of an Effective Performance Appraisal System:

• Objectives should be clear: The objectives of appraisal should be clear and specific. An effective performance system will always have specific appraisal attributes to match the employee's job description. 
• Data should be valid and reliable: An effective performance appraisal system provides data that is consistent, reliable and valid. It supplies data according the objective that serves the purpose of performance appraisal and succession planning.
• Performance criteria should be well defined: Effective performance appraisal has standard appraisal forms, rules and appraisal procedures. It will have well defined performance criteria and standards.
• Economical and less time consuming: Effective performance appraisal systems are designed to be economical and less time consuming to bring maximum benefits.
• Should initiate follow up: A post appraisal talk should be arranged for employees to get feedback from their Managers. It also helps the organization to learn about the problems and difficulties the employees might be facing and discover suitable training.

Performance appraisal is one thing that not done properly can harm the organization and the employees by creating conflicts. Organization that has conflicting teams at work can never prosper. Therefore, choosing an effective performance appraisal system is a wise thing to do, and it is now easy with Synergita Software that brings performance management closure to people and business.