Increasingly used by HR sectors, performance appraisal software is an essential tool to improve the alignment of your company’s internal culture and make people management more efficient.
Therefore, knowing how this device works and what are the main benefits of using it is essential to obtain better results.
In this text, we’ll cover how performance appraisal software can help HR. Stay tuned!
What is performance appraisal software?
A performance evaluation software is, basically, a tool that centralizes all the performance information of your company’s employees. In this way, it facilitates the implementation of evaluation processes within the organization and, consequently, enables the following gains:
- improvement in the strategic alignment of managers;
- strengthening of internal culture;
- increased transparency to employees — about the processes being carried out;
- greater personal development of professionals.
How can performance reviews be carried out?
There are two main customer ingress scenarios. The first one concerns customers who do not have a defined evaluation process and do not know how to do it.
So, in addition to the tool, they need to understand how to implement a performance appraisal process that brings results.
In the second scenario, there are customers who have a consolidated process and only demand the tool.
In this way, HR hires software to use and prepares a specific assessment model that includes all the company’s employees, but not necessarily in the same way.
In both contexts, albeit to different degrees, we have companies specializing in the development of solutions for People Management, which can assist their clients in the implementation or review of an evaluation process.
What are the main differences between the tools?
For the adoption of a performance evaluation software, it is necessary, as a first step, to register the employees – either through Excel spreadsheets or through specific APIs.
Thus, there is a list of collaborators and the filling of different fields that must be defined — such as name, e-mail, date of birth, position, etc.
Usually, these definitions can be customized according to the company’s taste, which is an important gain for the result to be more satisfactory.
After that, it’s time to create a performance evaluation model — which, after all, is the entity that defines how the entire process will happen.
At this stage, the HR sectors define who will be evaluated, distinguish the target audiences and can choose configurations that are based on position or area, among other preferred metrics.
Once the model has been defined, we proceed to the selection of the type of evaluation to be performed. In this case, there are 3 options:
1. By objective
The first one focuses on objectives. In this context, one of the following options should be chosen:
Objectives and Key Results (OKRs)
The use of OKRs is indicated for areas that seek innovation and high performance, as, as a rule, they are more daring parameters that can hardly be achieved. That way, employees do their best to get as close to the ideal as possible.
In the case of OKRs, managers usually don’t assess whether or not you did what you hired, but how much was delivered.
Goals, on the other hand, stipulate that the defined objectives must be achieved. There is generally no room for error. Typically, goals are mostly used by sales teams, while engineering, software, and similar teams use OKR models to foster innovation.
2. By skills
The other type of assessment that can be performed is based on the skills of professionals. In this case, there are also two options:
The first one has the manager responsible for evaluating his team of employees and checking the final grade of their competences. In other words, it’s all concentrated on the manager, who has 100% responsibility for the employees’ grades.
In the 360 model, on the other hand, the assessment is done in a way shared by the entire organization. Thus, the grade of each employee ends up being a composition of the manager’s grade with that of other employees.
In this way, all evaluations make up the final average along with the manager’s grade, which is also evaluated by those who are below him. The 360 model has grown significantly in relation to the classic model, ensuring the adherence of professionals to the organizational culture of companies.
The last case is when the type of assessment is based on both objectives and competencies, with a weight defined for each factor. This means that, in the end, each person’s grade ends up being the composition of the contracted objectives and the present behavioral competences.
What are the steps in the performance appraisal process?
1. Definition of Objectives
First, the objectives are contracted by all the company’s employees. This is a crucial step in the process. This is where employees define how they will contribute to the organization. For this reason, it is essential that the company defines and discloses in advance what the company’s strategic objectives are. With this, managers will be able to direct the efforts of their teams, helping employees to define clear objectives that are aligned with the organization’s strategy.
2. Results Report
Then, there is a more time-consuming step: the report. In it, employees execute their objectives and, simultaneously, report the results in the tool.
The third stage is the evaluation stage, in which the manager evaluates the objectives, competencies or both – depending on the model that has been set up.
The fourth step is calibration. At this stage, the HR area usually brings together the company’s managers to balance the grades, comparing the evaluations and taking into account factors such as: position, seniority, time of position, objectives and other factors that may be relevant. The purpose of this phase is to correct possible assessment deviations, enabling a process that is fair to employees.
Finally comes the feedback stage, a stage in which managers, in addition to the result, write a textual feedback, informing what the employee should stop, start or continue to do.
What are the benefits of a performance review?
As we have already seen, performance evaluation is of paramount importance to obtain metrics in relation to employees and, with that, to have better means for the management of companies.
With the tool, in this way, it is possible to manage based on performance, obtain insights into possible strengths and weaknesses of employees, work better on promotions and reassignments, among other factors.
In addition, especially in 360 assessments , management problems can be better detected and possible injustices by managers in relation to employees can be identified.
How can the tool help HR?
Based on the previous topic, the assessment allows HR to develop development plans for employees, whether those who are doing poorly — to try to improve their performance — or those who are doing well — to use them better.
The tool also provides a broader view of companies, comparing areas and employee performance.
In short, the software provides a lot of information and allows HR to analyze the numbers, see the dissonances and work on top of it all.
An important point, it is worth mentioning, is that as the software is used, its results must be used for decision making, otherwise it loses credibility within the company.