One of the things that managers and employees have in common is that they dread annual performance reviews. According to research annual reviews have not indicated much effectiveness. Out of an average 10 companies, 9 of them conduct annual performance assessments. However, only 3 of them find it useful. Additionally, neuroscience research suggests that performance-ratings systems may impact an employee’s motivation and productivity adversely – it may trigger a fight-or-flight response.
Below are three ways in which companies are changing the way annual assessments are carried out with performance review software. This software is known to have tremendous capability and allows you brilliant flexibility in terms of setting measurable variables.
1. Forgoing Annual Reviews
Annual reviews by managers and employers too. A lot of time is wasted just preparing these documents, and the concept of an annual review makes it sound overwhelming. It also has a disadvantage of getting employees keyed up when appraisal time is near.
This can blur an individual’s actual performance through a certain period especially when you have a new manager on the job who will largely rely on written data to assess each employee.
In contrast to this, an ongoing form of assessment carried out with performance review software continuously is best implemented to establish an employee’s true performance at any given time of the year. Thanks to this software’s ability, you can easily harness the power of employee performance data.
2. Rethinking Old-School Ratings Systems
Old rating systems have actually collapsed age ago because you can never really estimate an employee’s performance just by numbers and achievements. Today the concept is shifting towards the value of a person in terms of his or her input, communication, etc. as opposed to solely looking at what he or she has achieved on paper.
In other words, companies are now paying more attention towards ‘who you are as a person’ as opposed to ‘what you have achieved’. This is more fulfilling for employees and allows a company to holistically assess an employee’s performance.
3. Revamping Compensation Offerings
As opposed to the age-old concept of a fixed salary, companies have started being innovative things like biannual bonuses and peer-to-peer rewards. While the concept yesteryears was to think that employees served the company only, today it works both ways, as companies now want to engage their employees through smart incentives.
With compensation revamped, performance review software is more easily implemented and just makes more sense for companies and employees too.