An employee appraisal system is something everyone working in a company takes for granted. They are structured either quarterly, half yearly, or yearly depending on the company policy. Employees know that their growth and future in the company is dependent on it. But do they use it as a tool towards self-improvement and as a means to grow their skills?
At a base level, an appraisal system shows an employee who only has a manager he/she reports to and no one working under them, a one-way appraisal system is useful. But for employees who are a rung up and for managers at every level above them, there is no tangible way to gather what sort of a leader they are and how can improve both, their strengths and weaknesses.
After all, not all are born leaders, some are self-made.
A 360-degree appraisal system, as many of you know, is a feature in the appraisal system that allows members in a team rate and qualify their managers in terms of set criteria. Team members may post their ratings on their manager anonymously so that senior management gets an overview of the kind of leadership that they promote or hire to manage their teams.
But why is this important when for decades, companies have been making do with a linear approach to the appraisal system? Other than giving a junior employee to air their grievances, how does management benefit out of it?
5 reasons a 360-degree appraisal benefits an organization:
1) Improves the company culture
As a carrot-and-stick approach works with promotions and increments for team members to keep their output at an optimal level, the same approach works with managers when they are aware that their management style will directly affect their performance as a team manager, even if their performance as an individual contributor is appraised separately.
This helps senior management in gauging leadership potential of an employee in that role and gives an overview on the performance of the team and what motivates them.
2) Provides insights into the kind of leader they would groom
Helps in identifying the strengths and weaknesses of an employee in a leadership position and helps them groom into key positions based on their past performance and aspirations. In cases where a lateral placement is required, the management will be better informed. Not everyone is aware of what motivates them; if a senior employee can guide and motivate their employees, the organization will ultimately benefit from utilizing their core strengths in a way that helps the career vision of both the employer and employee.
3) Clarifies behaviours, Enhances performance and Reduces Attrition
There could be a number of reasons for suboptimal performance or employee dissatisfaction in a team. Lack of training, resources to complete the job, lack of clear directions and goals, communication problems, or plain misunderstanding. Training issues can be solved by identifying and providing the right training to employees, resources for job completion also is solvable based on the company, human resource issues can be, to a large extent, be solved by intervention and open communication.
Such issues can come to light if they are recorded and can be smoothed out to ensure reduction in dissatisfaction in employees. After all, employees don’t leave jobs, they leave bosses.
4) Encourages personal development, provides foresight into training programs
As mentioned above, lack of training can lead to loss of productivity. Effort taken by trial and test method to complete the job can be substantially reduced by providing right training. If the company has the resources to provide training but the employee’s lack of training is identified, it would be that much easier to bridge that gap.
5) Enhance employer brand value and attract right talent
A sensitive approach to handling professional atmosphere breeds a satisfactory and well-balanced workplace that is a pleasure to work for. This, in turn, ensures happy and productive workforce. In today’s online culture, everything is reflected in social media space, be it Facebook or LinkedIn, or Glassdoor. It certainly will not hurt to have a favourable review on honest and anonymous online spaces. For example, when a candidate is called for an interview, apart from visiting the company website, they immediately go to glassdoor.com to check out what is being said about the company by its employees. It is not possible to have a 100% positive review because there will always be somebody who is never satisfied. But an overall good picture paints the company in a good light and talented candidates will be interested in working for good employers
All the above mentioned points go a long way in ensuring that employee morale remains high and their productivity directly impacts project delivery. Therefore, it is beneficial to an organization to invest in a 360-degree appraisal system and keep the process transparent to boost its own growth and expansion.