REASONS TO AUTOMATEPERFORMANCE MANAGEMENTPROCESS - Subramanian Ramachandran

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TABLE OF CONTENTS

REASONS TO AUTOMATE PERFORMANCE MANAGEMENT PROCESS ..........................................................

MANUAL PROCESS .........................................................................................................................................................

AUTOMATED PROCESS ................................................................................................................................................

FEATURES OF AN AUTOMATED PROCESS ............................................................................................................

1. ALIGNING & LINKING GOALS ........................................................................................................................

2. COMPETENCY MANAGEMENT .....................................................................................................................

3. EMPLOYEE EVALUATION/REVIEWS ............................................................................................................

Makes Performance evaluation faster and easier to administer ...........................................................

More Relevant Reviews ....................................................................................................................................

Performance Calibration ...................................................................................................................................

Improves Employee Engagement ..................................................................................................................

Process compliance ...........................................................................................................................................

Identify performance trends .............................................................................................................................

Identify competency gaps .................................................................................................................................

Monitor improvements .......................................................................................................................................

Access to employee rating distribution .........................................................................................................

Customer satisfaction .........................................................................................................................................

Increased productivity ........................................................................................................................................

Time & Cost savings ...........................................................................................................................................

4. ELIMINATE PAPER WORK .................................................................................................................................

Role based Templates are readily available ................................................................................................

Electronic routing of forms for evaluation/reviews .....................................................................................

Automated notifications/alerts/reminders .....................................................................................................

Instant access to all relevant details including previous cycles ..............................................................

Consistency in delivery of appraisals and legal immunity ........................................................................

Reports/Analytics ................................................................................................................................................

5. DATA ANALYTICS ........................................................................................................................................................

SUMMARY ..........................................................................................................................................................................

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REASONS TO AUTOMATE PERFORMANCEMANAGEMENT PROCESS

The key to deliver sustainable business growth in the global market is by developing/enhancing sustainable

competitive advantage and improve human capabilities. To achieve sustainable competitive advantages,

organizations’ focus and substantial e�orts goes in re-engineering and automation of their processes, all this

to establish excellence in quality, to deliver more with less e�ort, reduce wastage and shorten production

cycles. But, this alone is not su�cient; an organizations’ capability depends on its talent pipeline. To yield

improved e�ciency it is necessary to align the workforce with the strategic objectives of the organization

and improve manager’s ability to guide their peers. The outcomes of automating the HR process are almost

similar to that of automating business process. This research has forced several organizations to automate

their HR processes and look at Talent Management as a Strategic business unit.

This paper sets out some of the benefits organizations can realize when moving from a paper based/manual

system to an automated system

VS

MANUAL AUTOMATION

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MANUAL PROCESS

In the current scenario, we can see that, most organizations have some form of Employee Performance

Management process.

AUTOMATED PROCESS

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The process usually comprises of labour-intensive and time consuming tasks such as manually collecting employee evaluation forms from multiple people.

a)

b)

c)

Best-practices

Easy implementation and

Flexibility to configure

Some organizations have managed to semi-automate the process, either through the use of word-processing/spread-sheet or other rudimentary computer application which causes more challenges and headache.

They serve neither for the purpose of decision making to improve performance nor employee development.

It also imposes a heavy dependence on the internal IT team for support w.r.t. to generatingreports, addition of new features or investing in IT hardware infrastructure making the process ine�cient.

Many organizations have turned to innovative web-based technologies to automate their Employee

Performance Management process. These organizations have replaced their painful, manual or semi-

automated process to web-based solutions which o�er a combination of:

These organizations ensure that the software is compatible with their HR and business processes.

Automated employee performance management tools help in aligning and linking employee goals to organi-

zational objectives, thereby, helps fix responsibility, accountability & improved responsiveness of employees.

This makes employee review/evaluation accurate & consistent; develop competency & skills by identifying

gaps and addresses learning & development needs. The organizations which have adopted these innovative

solutions have benefited from “increased productivity, reduced attrition and optimised compensation.

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FEATURES OF AN AUTOMATED PROCESS

Organizational Goals are achieved because of the e�orts of multiple people making it imperative to cascade

and align goals across multiple department heads and their team members. An automated Performance

Management System (PMS) simplifies the task of creating and establishing shared goals. A bird’s eye view is

set on how the team and individuals are performing. This improves the accountability of the objectives of the

1. Aligning & linking goals:

organization delivered by an employee.

An automated web-based PMS also improves monitoring by providing easy access to dashboard to track,

review and analyse progress of goals. It makes it easier to link organizational goals to employee output. This

ensures that employees with the right skill sets are working on the job and helps to contribute towards

coaching & reinforcement of goals to meet deadlines & keep performance on track. This improves employee

engagement and drives higher productivity positively impacting both top & bottom lines.

3

BUSINESSGOAL

DIVISIONALGOAL

TEAMGOAL

INDIVIDUALGOAL

EMPLOYEEGOAL REVIEW

EMPLOYEEDEVELOPEMENT

RATING

Increase revenuefrom

$100M to $200Min next year

Increase US teritorysales by 30% in 2012

Increase UK teritorysales by 50% in 2012

Generate 20% ofsalesin newly defined Asia - Pacific territory

Acheive $10M insales on the US Product Team

Sell $5M in newproduct and servicesalesin mid-market

Close $4M in newbusiness in Q1'12.

Sell $12M in CRM software in London

Market by end 2012

Hire 3 sales Peopleand ramp to $6M

each.

Work with marketingto generate 50qualified leads

per/quater

Acheive $8M in newproduct in enterprise

quota by Dec

Acheive $2M inservice enterprise

quota by Dec

Acheive $5M in newproduct in mid market

Quota by Dec

Employee acheived$4M in quota and

gained 45 newaccounts.

Acheive $12M inservice mid-market

Quota by Dec

Employee onlyacheived 70% ofquota and mostsales included

product.

Employee must improve pipeline

developement skills

Employee mustimprove closing skills

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By listing job roles and defining relevant skill-sets in a centralized library, the entire Talent Management

process can be streamlined, starting from:

2. Competency Management

Creating of manpower request

Defining job description

Reviewing employee performance

An automated performance appraisal system allows customizing and design standards for reviews based on

competencies for di�erent job roles.

Grooming them

Creating L&D plans for skill development

Succession plans and

Analyse attrition

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Succession

Planning

High Potentials

Career

Management Training

Recruting

Sta�ng

Compensation

360o

Assessment

& Perfomance

Management

Psychometric

Testing

Competency

Architecture

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Employees need ongoing feedback to be successful and focused on their goals. They have to know what

they are doing well and where they need to improve. An automated PMS helps in the following ways in

employee evaluation process:-

Makes Performance evaluation faster and easier to administer – It provides a full functional list

ensuring that everyone knows what task they have to complete and within what time period and sends

automatic reminders. Automating employee review process with a web-based system o�ers the flexibility to

customize and setup evaluation forms unique to job roles, competencies & goals. It also takes care of every

review at every step in the process – making it easier to know who has and has not received their feedback

3. Employee Evaluation/Reviews:

at any point of time. Routing of review forms is automatic by inbuilt workflow making it significantly easier for

employees, managers and HR. Employees and managers can access review forms from either a computer or

their mobile phone to fill and submit them from any part of the world. Some of these tools also have features:

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To make feedback ongoing and continuous which helps in providing specific actionable suggestion/advice

Also contributes towards coaching employees through a range of issues.

Also o�er 360 Degree feedback to select and solicit reviews from peers, superiors andsubordinates.

The inbuilt notifications enable HR to send automatic alerts and reminders to the workforce toensure the review process happens in a controlled environment and is completed by all in time.

Employee self -Evaluation

ManagerEvaluation

Multi-ParticipantEvaluation

Enter comments and ratings

Mark evalutions Complete

FinalizeEvaluations

Enter preliminaryratings

Employee beginsSelf-evaluation

Manager beginsmanager evalutions

Nominee acceptsNominations

Enter PerfomanceNotes

CriteriaDocument

DocumentTemplate

or

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More Relevant Reviews - Real time tracking of the progress towards goals arms the manager to provide

accurate, meaningful, relevant and consistent feedbacks on time which employees can easily relate-to. This

is perceived to improve employee engagement levels and reduce the cost of employee turnover.

Performance Calibration - An automated employee evaluation system allows evaluating goals and com-

petencies as often as you want, making it easier to compare performance between individuals, groups and

departments across the organization and helps calibrate competencies and performance.

Improves Employee Engagement - Numerous studies have indicated that there is a strong correlation

between feedback, employee engagement and higher productivity. One of the abilities of an automation

tool is to provide real-time accurate insights to gauge and monitor employee engagement.

Process compliance - Automating employee reviews with web-based system enables to monitor those

who are at various stages of the review cycle in spite of the demographic distribution and helps to keep

track of participation of the entire workforce in the performance review. By defining rating guidelines

“Rating consistency or standardization” is achieved which results in consistent employee evaluation, this

leads to employees perceiving the process to be fair and taking the feedback and ratings seriously.

Identify performance trends - By automating Performance Management system, progress towards

organizational goals or we should call it as “employee development plans” w.r.t. departments, teams and

individual employees can be easily tracked. Additionally, it also becomes easier to keep track of all apprecia-

tions, awards and rewards and to promote individual employee’s achievements or maintain an incident diary

in case of an area of improvement.

Identify competency gaps - The automation process helps identify and determine critical skill gaps at an

organizational level. The inbuilt analytics easily helps in drilling down competency and performance ratings

which can help identify areas of strength and potential weakness and put the right learning & development

programs in place to address skill gaps and develop employee capabilities to their fullest extent.

Monitor improvements - The automation process helps identify and determine what skills need to be

improved in employees which bridges performance gaps. Some of these automation tools are also built with

a training courses catalogue, so supervisors/managers can assign appropriate training courses as develop-

ment activity and track completion of these courses and measure improvement in employee performance

rating over the commendable time period.

Access to employee rating distribution - Appropriately reward consistent top performers.

Customer satisfaction – High employee morale often results in higher performance and therefore, result-

ing in better products which increases customer satisfaction, that ultimately leads to brand loyalty and most

importantly top & bottom lines.

Increased productivity – HR team can anticipate savings of up to 50% time spent on administrating the

review process. The same goes with managers saving 50-70% of their time writing employee reviews,

managing performance and development as all performance related details are available upfront without

having to coordinate for details. It is estimated that managers and employees can save up to two hour

completing each appraisal reviews.

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Time & Cost savings - Savings on time & money is realised on paper, printing, filing, coordinating /

follow-ups.

An automated web-based system helps eliminate many challenges associated with a manual process:\

Role based Templates are readily available – Complaints on lack of knowledge of how an employee’s

role fits in the overall organizational strategy is eliminated, this also reduces up to 90% of time spent on

generating forms and administration of the review process.

Electronic routing of forms for evaluation/reviews - Access either through a computer or even mobile

phones, hence, saving time and review/approvals can happen even on the move.

Automated notifications/alerts/reminders - No need to chase people down automatic alerts informs

people to complete evaluation – this reduces substantial e�orts and potentially saves several man-days for

the HR team.

Instant access to all relevant details including previous cycles – Eliminates the need to make

endless copies and inadvertent access to those not concerned.

Consistency in delivery of appraisals and legal immunity – Helps protect against lawsuits and legal

hazards as all performance conversations are logged and ratings are evidence based. It is also easier to

keep records to document the e�ective and ine�ective performances to substantiate evaluations. These

documents are archived and can be easily produced on demand.

Time & Cost savings - Savings on time & money is realised on paper, printing, filing, coordinating /

follow-ups.

Well documented training and employee development plans

Ability to tie performance to rewards & pay increase

Reports/Analytics - Automated systems have the potential to generate powerful insights quickly and easily

as most automation softwares are built with reports building tools.

4. Eliminate Paper Work:

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An estimated 90% of paper processing can be eliminated, making the automated process convenient,

smooth and environmentally friendly.

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5. Data Analytics

One of the major challenges of the manual process is aggregation of data for analysis. An automated system

has the potential to generate powerful insights quickly and easily – this improves response to performance

issues and to mitigate risks. Automating the process gives access to business leaders and HR a variety of

data about employee performance and development needs. The software tools usually provide details

pertaining to:-

These data can be analysed for trends and use it to improve employee performance, rating calibration, work

assignments, skill and career development planning and compensation, in other words it emphasizes on

how to operate the business more e�ciently and increase profits.

High performing/high potential/underperforming employees

Ratings as per competencies

Insights on development needs of organization/department/groups/employees

Alignment and progress on goals & engagement levels

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Employee performance review is an important tool that drives performance, productivity and

accountability all together. It is critical to unlock the full potential of individuals and maximize

financial performance. Automating makes the process more e�cient and transparent as it saves

valuable time and relieves considerable administrative burden. It also helps to unlock the benefits

for everyone in the organization. Automation also provides clarity on what is expected and how

individual goals support organizational goals, resulting in improved engagement levels and positive

impact on business performance.

Summary: