Learn how to update your performance appraisal methods with these steps. Improve your performance management skills and achieve your organizational goals.

While looking at industry trends and ‘what’s happening out there’ is essential, the key is to know your people and your business. The performance appraisal systems should be a tool to reward, motivate and encourage people and hence knowing what motivates your teams is crucial.

How do you update performance appraisal methods?

Performance appraisal methods are the tools and techniques that managers use to evaluate the performance of their employees. They help to provide feedback, identify strengths and weaknesses, set goals, and reward achievements. However, performance appraisal methods are not static and need to be updated regularly to reflect changing organizational needs, employee expectations, and best practices. Here are some steps to help you update your performance appraisal methods.

1 Assess the current methods

Assessing the current performance appraisal methods is the first step in determining how well they are working for your organization. To do this, you should review existing documentation, policies, and procedures, as well as collect feedback from managers, employees, and stakeholders. Aspects to consider include the frequency, format, criteria, standards, and metrics used to measure performance; the alignment of appraisals with organizational goals and values; the fairness, consistency, and transparency of appraisals; and the impact on employee motivation, engagement, and development.

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Chinwe Obi - Onuchukwu SPHRi CIPD

Talent Management Leader | Organizational Design Expert| Senior Human Resources Management Professional | ICF Certified Coach, Speaker & Author | Board Member
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Performance Management is not a one - size fit all process that can be bought off the shelf, In my experience, I have come to realize that what works for company A most often will not work for company B, hence it is critical to ensure that your organization's PM system is in alignment with your business goals, strategy and objectives. The process must also be clearly documented and understood by all team members, it is also not a sole HR responsibility, it should be driven by line managers and business executives before it can be successful.

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2 Identify the gaps and opportunities

The next step is to identify the gaps and opportunities for improvement in your current performance appraisal methods. By comparing your current methods with industry best practices, the latest research and trends, and the feedback from your assessment, you can assess relevant factors such as the accuracy and validity of the performance data, the clarity and timeliness of the feedback, how involved appraisees are in the process, how well high performers are recognized and rewarded, and how potential performers are identified and developed.

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Chinwe Obi - Onuchukwu SPHRi CIPD

Talent Management Leader | Organizational Design Expert| Senior Human Resources Management Professional | ICF Certified Coach, Speaker & Author | Board Member
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We often forget that performance management should be a continuous process. It is not an event that we engage in once or twice a year, there has to be continuous engagement and feedback between employee and line manager to ensure there is alignment with organizational goals for the year under review. Nothing should be left to chance. Line managers must also be trained on how to engage in effective PM becuase they are expected to drive the process within their departments

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3 Define the objectives and outcomes

The third step is to define the objectives and outcomes that you want to achieve with your updated performance appraisal methods. Setting SMART goals (specific, measurable, achievable, relevant, and time-bound) that align with your organizational strategy, culture, and values can help you reach these objectives. Additionally, it is important to consider the potential benefits and challenges of updating your performance appraisal methods. These could include improved employee performance, productivity, and quality; enhanced employee satisfaction, loyalty, and retention; reduced employee turnover, absenteeism, and conflict; increased legal compliance, ethical standards, and diversity; as well as the cost, time, and resources required for the update.

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Chinwe Obi - Onuchukwu SPHRi CIPD

Talent Management Leader | Organizational Design Expert| Senior Human Resources Management Professional | ICF Certified Coach, Speaker & Author | Board Member
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It is important to engage employees in the process of goal setting, this helps them understand the "why" the "how" and the required expectations. They are also allowed to make contributions and ask questions for clarity. They take ownership of the process when they are involved from the on set.

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4 Select the appropriate methods

When selecting the appropriate performance appraisal methods, it is important to evaluate the advantages and disadvantages of different methods. Rating scales, checklists, and forced-choice methods use quantitative measures to rank or rate employees. Essays, critical incidents, and narrative methods use qualitative descriptions to highlight the strengths and weaknesses of employees. Management by objectives (MBO), key performance indicators (KPIs), and balanced scorecard (BSC) methods use goal-setting and results-oriented approaches to evaluate employees. Furthermore, 360-degree feedback, peer review, self-appraisal methods, behavioral observation scale (BOS), behavioral anchored rating scale (BARS), and competency-based methods all use multiple sources and perspectives to assess employees.

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5 Implement and monitor the updated methods

The final step is to implement and monitor the updated performance appraisal methods and ensure that they are effective and efficient. To do this, it's important to communicate the changes and expectations to all relevant managers and employees, as well as provide training and guidance on how to use the updated methods and tools. Additionally, regular appraisals and feedback sessions should be conducted according to the schedule and format. Furthermore, performance data and feedback should be collected, analyzed, and reviewed to adjust the updated methods as needed based on the results.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Sabra Patni

People I Sustainability l Board Member l Diversity & Inclusion l Artist l Author. CSR and Chair of POSH committee
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While looking at industry trends and ‘what’s happening out there’ is essential, the key is to know your people and your business. The performance appraisal systems should be a tool to reward, motivate and encourage people and hence knowing what motivates your teams is crucial.

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Chinwe Obi - Onuchukwu SPHRi CIPD

Talent Management Leader | Organizational Design Expert| Senior Human Resources Management Professional | ICF Certified Coach, Speaker & Author | Board Member
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The world is constantly evolving, especially since the pandemic. It is critical that as professionals, we stary abreast of these changes, how they impact our organizations in terms of performance management and make conscious effort to adjust and stay up - to - date.

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How do you update performance appraisal methods?

1

2

3

4

5

6

1 Assess the current methods

2 Identify the gaps and opportunities

3 Define the objectives and outcomes

4 Select the appropriate methods

5 Implement and monitor the updated methods

6 Here’s what else to consider

Performance Management

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How do you update performance appraisal methods?

1

2

3

4

5

6

1 Assess the current methods

2 Identify the gaps and opportunities

3 Define the objectives and outcomes

4 Select the appropriate methods

5 Implement and monitor the updated methods

6 Here’s what else to consider

Performance Management

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