Key principles involved in designing and implementing an effective Employee Appraisal System part 2/3

Today - according to our weekly blogging schedule - it's time for another installment of employee evaluation knowledge. You can find the previous entry here. As part of my exploration of the topic, I came to the conclusion that it would be optimal to divide the issue into three parts (instead of the previously planned two). The article will be reader-friendly, and we are assured that the topic will be put into a decent informative framework.

Principle 3 - When designing the system, define precise criteria and measures, making sure that they follow from the adopted grading concept.

When designing an evaluation system, an extremely important issue is the selection of the concept and the establishment of evaluation criteria. When choosing criteria, you can use a concept based on:

• efficiency criteria (concerning the results of work, such as the quantity and quality of work done, timeliness of tasks performed, economic effects, including: the amount of profit achieved per employee, the value of sales, etc.),
• behavioral criteria (concerning the behavior observed during the performance of tasks in the perspective of the requirements, including the readiness for professional improvement, professionalism in action, attitude to customers, superiors and co-workers, etc.),
• personality criteria (such as, for example: creativity, responsibility, reliability, resistance to stress, etc.),
• or qualification criteria (education, experience, skills, aptitude).

The choice of evaluation concept can also be a combination of all the above criteria. Regardless of the choice of evaluation concept, the criteria being evaluated should be assigned a specific weight, specifying both priority and secondary or additional criteria. The selected indicators do not have to be the same for everyone. It may happen that similar jobs are characterized by different indicators, while they must be adequate and specific to the job. The specified valuation criteria should be measurable, and the way they are calculated must be understandable to both the evaluators and the appraised themselves.

Principle 4 - Ensure that every participant knows what the rules and criteria for evaluation are.

The effectiveness of the system is evidenced by its openness- the principles and criteria according to which the evaluation is carried out must be open and widely known to everyone in the company, otherwise the system ceases to fulfill its "development" function, as employees do not receive information about their strengths and areas for improvement (desirable for a specific position in terms of effective task performance). It is a good strategic move to familiarize employees with the adopted evaluation criteria, in order to learn their opinions and gain acceptance, especially since the evaluation process, despite being a necessary activity, invariably arouses a lot of controversy mainly among those who are evaluated, and leads to an increased sense of their insecurity, which may be due to low self-esteem of the employee or be influenced by external factors (e.g.: high unemployment, competition in the labor market) and the professional environment (lack of information strategy in the area of evaluation). Appraisal criteria, even the most open and in line with the company's strategy, will not serve their function if they are not publicly presented and explained, and thus not understood by employees. The requirement to understand the system applies to both the evaluators and the evaluated. This is an important condition in the effective design and implementation of an employee evaluation system, because, as S. Celińska - Nieckarz rightly noted, "in order to evaluate a person, behavior or situation, two conditions must exist: the individual being evaluated must be familiar with the subject of the evaluation and know the criterion against which the evaluation is to be made."

Principle 5 - When determining the methods and techniques of evaluation, remember to adapt them to the specifics of the company.

Determining the evaluation model, defining the purpose/objectives, making the selection of the concept and establishing the evaluation criteria are decisions of a strategic dimension, while determining the degree of formalization of the evaluation and establishing the specific methods that will be used during the evaluation of individual groups of employees within the framework of the adopted concept are decisions of a tactical nature. Within the framework of the adopted concept of evaluation, the following can be used: ranking techniques, techniques oriented to employee behavior (such as descriptive methods, point scales, critical event technique, weighted scales, selection tests), or performance-oriented techniques (characterized by moving away from focusing attention on employee behavior, and focusing it on evaluating the contribution of work to tasks, the achievement of goals set by the company). An effective Employee Appraisal System must be developed for a specific enterprise and can be a "mix" of techniques and methods, provided that they are tailored to the specifics of the company resulting from its organization, ways and areas of functioning in the market, traditions, organizational culture, or, finally, the personality of the people employed there. The transfer of "template" patterns of evaluation sheets and procedures of conduct, as a rule, is inadequate and of little use.

Principle 6 - Determine the frequency of the evaluation conducted, so that it harmonizes with personnel sub-strategies and company strategy.

As part of the design of the Employee Appraisal System, the frequency of appraisals should be determined so that the information from the conducted appraisal will provide the information necessary for the smooth implementation of the sub-strategy of recruitment and selection, motivation and development of personnel. The frequency of conducting evaluations will also depend on whether a sieve model or a human capital model is in operation at the organization level. If the sieve model is used, the frequency of evaluations will be higher, as it is necessary to "separate successful employees from those who are not successful at work as quickly as possible." The frequency of appraisals will be lower if the company presents a soft orientation (human capital model), due to the fact that this model develops and spreads a culture of conciliation and understanding, treats employees as a unique resource, involving them in the management process, motivates them to work by using not only financial incentives, but also by delegating authority and responsibility, showing respect, recognition, trust, creating conditions and opportunities for self-realization. In this model, managers have "more patience capital" with which they endow their subordinates, and use an individualized approach (differentiated as to pace, direction and effectiveness) to the development of individual employees, hence the receipt of frequent information from the course of evaluation is not so important from the point of view of implementing the sub-strategy of recruitment and selection. It should also be borne in mind that the frequency of appraisals should harmonize not only with personnel sub-strategies, but most importantly with the company's strategy.

The next article will already be finalizing our series on correct employee evaluations. We will workshop the last two principles, and thus dot the "I", or in this case, the "O".