For any business leader, making business decisions not backed with data would be a grave mistake. Informed decisions are much more reliable compared to “gut-feel” decisions as data provides context. Data minimize risks since they offer decision-makers clear reasons as to why they should choose a certain option, the most ideal way they could implement the said option, and hypothesize on how effective the decision will be. Indeed, data is a very powerful tool for businesses.
Using external reviews to better a company’s performance is practically a necessity. And if a company’s outward performance can be examined and improved using reviews then it follows that the same can be done for employee performance. However, it’s a mistake for companies to only conduct performance appraisals when necessary. This is far from the ideal case as performance reviews are supposed to be implemented regularly throughout the employee experience to aid in their development.
As knowledge is power, data gathered from performance reviews can be harnessed for the benefit of the company if employers and managers put the results into good use. Here are a few ways business leaders can use data-driven performance reviews to empower your company:
Gauge and increase productivity
Off the bat, employee performance appraisals measure an employee’s productivity through relevant determinants depending on their job position. Employers and managers can look at the employee’s key performance indicators that paint a picture of their overall performance to determine which ones are being met or not. And if they’re not, data-driven performance reviews could reveal exactly why. Perhaps the employee has an above-average level of inputs without producing more outputs. Or their cycle time is longer than what’s expected of them. Performance appraisals allow both employer and employee to address the root of the problem and work towards improving.
Define and improve job descriptions
Companies require maintaining a standard of quality for the products or services that they provide. When it comes to defining job descriptions to preserve the company standard, there are other ways than simply seeking out feedback from supervisors who monitor the work. If the job more or less stays the same, human resources can also look at the performance reviews of previous employees to inform any interested parties exactly what it takes to excel in the position. Performance reviews look at the entirety of an employee’s responsibilities and sometimes even how the employee should go about them.
Additionally, employee performance appraisals can determine whether a certain job position should be given more responsibilities. An employee can check all the boxes in their given goals and to-do lists while the overall department or company still shows no outward improvement. This might be a sign that the previous list of responsibilities of the employee wasn’t enough to guarantee the company reaching its desired goals.
Inform company reward systems
Reward systems are one of the easiest and simplest ways to increase employee motivation. Whether it’s in the form of a year-end bonus or pay increase, rewards inspire employees to improve. However, employers who offer incentives to their employees need to know exactly who they should be rewarding to encourage them to improve further. Otherwise, they risk sending the wrong message. A common mistake would be to only look at the number of leads generated or output delivered when in fact, there are other factors in play. The person who generated leads might actually have a lower closing rate than their colleagues or perhaps their average cycle time is longer than the others. These high-performing employees might be meeting their KPIs, but that doesn’t mean that they bring much value to the company when looked under a microscope.
Performance reviews provide a little more context to an employee’s efficiency and effectiveness. Perhaps upon closer look, the employee who revealed to bring the most leads have a lower rate of closed deals. Or the employee who delivered the most output had a larger ratio for errors. Quantity does not always guarantee quality and data gathered from employee performance appraisals will reveal exactly whether any aspect of their performance was sacrificed.
Weigh in on promotion or termination
Performance appraisals are used to look back on the employee’s time in the company along with their achievements and failures. Employers and HR managers will get to see objectively whether the employee in question has improved throughout the duration of their stay with the company.
Did they perform well given their goals and objectives? Did they perhaps show initiative and take on more responsibilities than what was initially required of them. Were there any red flags given their respective key performance indicators in employee evaluations or did they pass in flying colors? Employee performance appraisals will help determine whether an employee has a future within the company or not.
Are you looking to further improve your company’s employee training with data? You can start by integrating a learning experience platform to improve the training experience for employees and employers alike.
SkillBean provides companies in the Philippines a learning experience platform that allows employers to monitor and track employee learning development, aid in succession planning, and sourcing out potential in-house trainers, by providing a detailed profile complete with their learning history, progress, and behaviors.
Message us at [email protected] to schedule a meeting.