How to Improve Employee Performance with an Online College Degree
December 18, 2020
Do you have great ideas about improving employee performance? Are you looking for new strategies and insights in your company’s performance appraisal methods? The online college at Grace has taken the time to explore the ins and outs of the types of performance appraisal and how it can be used wisely within each company.
Rethinking the employee performance review is at the top of many executive teams’ agendas, according to Harvard Business Review. The greatest limitation of the annual employee performance review undermines organizations at their core. “With their heavy emphasis on financial rewards and punishments and their end-of-year structure, they hold people accountable for past behavior at the expense of improving current performance and grooming talent for the future, both of which are critical for organizations’ long-term survival,” according to the Harvard Business Review. “In contrast, regular conversations about performance and development change the focus to building the workforce your organization needs to be competitive both today and years from now.”
The following sections explore various types of performance appraisal and how organizations can make the process more innovative and relevant. Rethinking performance appraisal is heavily considered at Grace’s online college degree in business administration, and graduates carry this framework into their careers.
Goals for Employee Performance Reviews
There are five goals of a performance appraisal system, according to Inc.com
- To improve the company’s productivity
- To make informed personnel decisions regarding promotion, job changes, and termination
- To identify what’s required to perform a job (the goals and responsibilities of the position)
- To assess an employee’s performance against the goals of the position
- To work to improve the employee’s performance by naming specific areas for improvement, developing a plan aimed at improving these areas, supporting the employee’s efforts at improvement, and ensuring the employee’s commitment to improvement.
These goals work in conjunction with each other. For instance, once companies identify what’s required in a position, they can assess and improve an employee’s performance, which then helps organizations make informed personnel decisions. All of the goals align with enhancing company productivity. With an online college degree, you can learn more about improving your company while maintaining your full-time career.
Types of Performance Appraisal
- Traditional: A traditional performance appraisal involves a manager sitting down with an employee and discussing performance for the previous performance period, which is typically a single year. Ratings are often tied to salary percentage increases.
- Self–Appraisal: Self-appraisal refers to employees taking responsibility for their performance and development goals by assessing their own achievements and failures. Self-appraisal can be used alongside other types of performance appraisal, but cannot replace an assessment of the employee’s performance by a manager.
- Employee–Initiated Reviews: With this review system, employees can ask for a review from their managers; but it is not meant to replace a conventional review process. The review system can promote an attitude of self-management among workers. While adherents contend that it promotes regular communication between employees and their managers, critics say communication is dependent on employees’ initiative, which is less than ideal for employees who are quiet or lack confidence.
- 360–Degree Feedback: This refers to feedback provided by the manager, different people or departments an employee interacts with (peer evaluation), external customers, and the employee. It also includes employee-generated feedback on management performance. In 360-degree feedback, an employee’s performance is observed by those who work most closely with that employee.
Talent, Innovation, and Performance
Harvard Business Review identified three reasons why companies are abandoning the traditional performance appraisal. Each reason offers insight into how to reformulate the performance appraisal to make it more effective and relevant.
- Talent: There is competitive pressure to upgrade talent management efforts. Not only does development lead to better workers, but retaining skilled workers is more difficult if talent management is another “dissatisfier” that drives employees away. Organizations need to focus on developing people, rather than numerical ratings.
- Innovation: Innovation in business is what agility is to the employee performance review. As part of GE’s business strategy based on innovation, the company borrows agile techniques for performance management. Now, instead of only end-of-year summary discussions, the goal is to push frequent conversations with employees and managers. These “touchpoints” revisit two basic questions: “What am I doing that I should keep doing? And what am I doing that I should change?” This process takes annual goals and replaces them with shorter-term “priorities.”
- Performance: Eliminating appraisals’ focus on individual accountability makes it easier to foster teamwork, improving overall performance. At retail companies like Sears and Gap, employees work together to keep shelves stocked and manage customer flow. In these environments, traditional appraisal systems don’t enhance performance at the team level or help track collaboration. Gap supervisors still provide year-end assessments, but only to summarize performance discussions that occur throughout the year and to set pay increases accordingly; goals are short-term. Gap reports far more satisfaction with this performance process and the company has had the best-ever completion of store-level goals.
Pursuing a Career in Business Administration
Online college at Grace is the launchpad you need to enhance your career in business and improve your employee performance. The Grace College Master of Business Administration degree is constructed and courses are delivered with an intentional applied emphasis. Consistent with learning-by-doing, course assignments allow students to use course concepts in their current employment setting. This allows students to quickly develop an initial proficiency with the concepts being covered. It also allows students to demonstrate to their employers the value-added nature of the online college program.
Learn more about Grace College’s MBA!