As true consultants we will answer: it depends! It depends on the organization, on its history especially when it comes to evaluation processes, on the people that form it.
If we face a traditional organization, in which the technological impact is scarce, which is used to verbally report or by means of paper documents, then it is clear that putting them in front of a PC will increase from 1 to 100 the level of tress and paranoia, especially if they were never evaluated.

On the other hand, if we talk about an organization that is highly computerized, in which the technical impact is great, to offer employees a piece of paper on which to evaluate their colleagues would raise some questions. What if my handwriting will be recognized? What if the person who I evaluate would see what I wrote?

the questions above appear even in the case in which such an organization have had other evaluation processes, but using printed forms. This step from on paper evaluation to computerized one can also generate stress and paranoia, leading to a tendency of either being severe (the case of those implicated in managerial activities) or being indulgent towards the colleagues in the same hierarchical position.

In conclusion, both paper and computerization can influence the evaluation results if they are not chosen taking into account the organizational specific and employees’ expectancies. Therefore, it is necessary, before choosing concrete ways for your employees to offer feedback regarding other colleagues’ performances, to analyze the context, history, employees’ technical comfort zone, the way in which you can guaranty confidentiality. And once you have chosen a way, try to change the tune rarely, so the process of evaluation doesn’t become stressful, frustrating and tiring.

Even though this scenario is truly apocalyptic, the main criticisms to this evaluation system should be analyzed:

The first criticism: it is not useful and more than that it is not indicated in the companies where employees are not previously informed over the procedure of offering feedback. I hope everyone agrees that instructing an employee over this matter is not a punctual activity solvable in two days of courses. And even if it would be, the implementation costs would grow in major companies more than necessary.

Whatever the situation, the solution is a simple one: the evaluation should be made with short, explicit and well addressed questions. The evaluation questions or affirmations shouldn’t contain words with double meaning, statements and negations in the same time, neologisms, over specialized words. If you ask your employees to offer opinions over the “meta-cognitive” abilities that their colleagues have, they might be put in an impossible situation. If, however, they are directly asked if they have the ability to learn, it is possible they know how to answer.

Moreover, as the time passes, offering feedback whenever it’s asked for, employees learn to control these abilities. It is true that the first evaluation session is not always the most successful one, but the quality of this process improves with time.

The second criticism: most of the times these assessments are not motivated, meaning there is no need felt to start such a process. Setting an optimal level of performance for the employees is a goal itself, a major motive, it has no need for other purposes to precede it. As long as the employees don’t know the reason, the quantity, and the means to do their job the chances of high performance are extremely low.

The third criticism: it is not a unique instrument to rely on, the information must always be correlated with others to become relevant. It is correct: the performance of employees will always stand at the intersection of their capacities and the manner their company encourages/motivates their manifestation. You can set the lath, but if you don’t provide a favorable environment for performance and the necessary instruments, it’s in vain! Even so, a survey elaborated correctly can also identify problems such as: precarious organizational environment, the lack of leadership, managerial problems. If the majority of employees has problems, for example, with the adhesion towards the company, it is clear that the problem isn’t theirs. Hence, most certainly the 360 degrees evaluation is not a universal remedy, but it is a valid and useful instrument.

All in all, an old saying states that: “The hand that doesn’t know how to write, blames the pen.”

The 360 degrees feedback is a useful instrument which can induce value, only if it is professionally implemented, in stable organizations, with clear structures and objectives. If the organization has problems, if the management is scarce, than the 360 feedback may face problems. But it may be possible that the feedback itself can be the exit from the negative labyrinth.

What does multisource or circular feedback mean?

The multisource feedback is a method of evaluating employees, using more sources, multiple evaluators in different hierarchical and functional positions towards the evaluated person, inside or outside the organization. It is preferable that every evaluator to tell their opinion anonymously, so that the risk of biases be low.

Despite its “youthfulness” (the ‘90s were the years of great tumult for theories in this area), its penetration rate is extremely dynamic. A study made by one of the most important consultancy firms in USA shows that, if in 1995 40% of the American companies used it as a managerial instrument, in 2000 the rate has increased to 65%. There are no clear studies in Europe, but the numerous number of multisource evaluation software products existing on the market shows that they are greatly used/needed.

The motives of its popularity are very clear: the results of a multisource feedback are more relevant than the ones of an objectives evaluation, as it shows not only the capacity or incapacity of employees to perform, but also offers a diagnosis for the obtained results. Moreover, the costs, the time dedicated and the necessary logistics are by far lower than in the case of assessment centers, a thing not at all to be neglected.

Even so, in the local companies the use of such a feedback is relatively low. A study made by ITEX(not so formal to be taken as reference, but sufficiently documented to be taken as an example), shows that from the 40 local top managers questioned, none of them have yet implemented in their own company or in the department that they run, performance evaluation systems. None what so ever. From them, 38 would like to implement a multisource feedback system, and 2 of them believe in the power of single source or “one on one” feedback (unstructured discussions between direct manager and employee).

Where does this desire come from and why is it backed by a lack of actions?

On one hand because of the almost omnipresent mentality: economical performances are generated by money, marketing policies, strategies and necessarily by people. As long as people don’t count in the equation of success, their performances aren’t that important to be measured.

On the other hand because of the maturity lack of the HR market, which put all its money on recruitment, forgetting to offer and promote other services. “The right person in the right place” cannot be exclusively attributed to recruitment and selection processes, as both man and place are dynamic entities. Therefore it is necessary once in a while to be verified if the man and the place are in tandem.

Last but not least, because of the fact that the majority of managers think that employees evaluation and especially the 360 degrees feedback are extremely expensive: they need time, money and paper (bits nowadays) and offer nothing in return.

I can fight that last impediment, using the keypad as a weapon and I state that not evaluating is far more expensive than doing it. Unlike performances, non-performances are double priced: employees’ salaries and all the afferent expenses, adding the costs of their mistakes, of their choice of not implicating themselves in their job and of contagiousness, as encouraged non-performance spreads like a plague.

How does multisource feedback help?

The main benefit of evaluating performances is represented by …performances themselves. Through circular feedback you don’t just evaluate employees but you also help them understand what it is expected from them. Moreover because of the multiple sources of opinion they tend to change their behavior easier. Among the main benefits, therefore I list:

- Improving organizational communication;

- Improving the company’s services or products, the relationships with clients, suppliers, partners by actively implicating them in the employees performances analysis;

- Improving the working environment;

- Improving organizational performances in all evaluated hierarchical levels, improving individual performances;

- Waking the organization’s “self consciousness”, identifying the human capital’s strong and weak points, therefore identifying new ways of managerial actions;

- Creating an organizational map of high performance employees and of lumber, of dispensable employees. This is a starting point for establishing personnel necessary and forms of contingent remuneration (wages increases, bonuses)

What is the real greatest impediment in performance evaluation?

The biggest impediment is that of describing performances, of detailing it in specific, measurable, objective and relevant indicators. A specialist who knows the organization, its objectives, the people, can easily make this thing a reality. Let’s not forget that setting relevant indicators is done only at the first evaluation. Afterwards, their actualization is facile and takes little time.

What are the risks?

Companies with a stressful environment are possible to find this process as a supplementary stress, as a test the employees are forced to take which will surely generate negative consequences. However, with practice the risk can be minimized.

The objective of the assessment was to ensure an effective human capital, capable of generating a high efficiency of the professional activity, in order to ensure clients of great quality services.

“We wish to offer our clients access to the best services. Along our investments in the IT system and solid activity procedures, we want to ensure them that the performance of our employees meet their expectations” said Catalin Neagu, General Manager of Top Factoring.

All the company’s employees were involved in the evaluation process. The collection of performance indicators was comprised of 100 items and the assessment took the form of a multi source feedback. In the process of evaluation were considered both the self-evaluation and the evaluation of the direct manager, the ones of the colleagues from their department and in the same hierarchical level, as well as assessment of colleagues from other departments, taking into account the logic of professional interactions.

“Because we are talking about a „ITEX 440 You and Us” implementation we were implicated in all fazes of the project, including the design of the assessment questionnaire, the evaluators-evaluated relationship setting and the overall management of the application. It was a challenging project precisely because Top Factoring has a unique organizational culture in the local market, being a democratic company, in which employees express themselves freely, a culture that might have been affected if the process of evaluation wouldn’t have been carried out optimally” declared Valentina Neacsu, General Manager of ITEX.

Because of the relaxed working environment and because of the management style inside Top Factoring, the evaluation project had an efficient flow, generating relevant results.

About Top Factoring:

Top Factoring is one of the first three players of the local financial services market, with a 17 percent market share. Its competitive advantage lays in an intelligent management of debts, by collecting in o correct manner all unpaid debits, both in the B2C and B2B market.

About ITEX and ITEX 440:

ITEX is a recruitment, consultancy and HR software firm. Its mission is to help companies in meeting their long term strategic objectives.

The most recent ITEX product is ITEX 440, a high-performance instrument with the main goal of managing evaluation processes, born from the declared need of more and more managers: knowing their employees and the way they do their job.

The solution is based on the Software as a Service principle. ITEX 440 is therefore a web tool that doesn’t imply any infrastructure costs. The data is secure and can be accessed at any time with just a web browser.

We provoke you to see it in a positive manner, through another lens: 2009 was a good year, full of trial experiences, which made us more mature and taught us an unhoped amount of things, helped us change very quickly and fast our vision of things and forced us to focus on the things that truly needed attention. A year that sorted friends, employees, clients, partners, close people that are beside us through good and more important through bad from the ones present only on a good weather. A year that brought us experience and solutions as ten gathered. Therefore, a year of reference, which trained us intensively, in just 365 days, for an unpredictable future with no limitations of time.

And so we wish you that the New Year, whatever it may bring, stands under the sign of this challenge: the gain of a positive approach.  Welfare, health, relationships, all depend not only on the context but on the way we know how to analyze situations, focusing on gains and not on loss.

We wish you all the best, health and inexhaustible wisdom!

Happy holidays and a 2010 with at least 365 fulfillments and with at least two evaluations for the employees in your company!

We hope to hear only of good things after the holidays!

Here are some conclusions regarding the projects (there will surely be more formal case studies posted in the near future, until then will have a friendly chat):

1. Against all expectations, employees are glad to be part of an evaluation process. And the idea of evaluating in front of the monitor is more exciting for them. We never expected so much implication, so many emails with questions, so much curiosity!

2. Also, exceeding our expectations, up until now there weren’t functionalities that were needed and the application didn’t contain. It is true that we tried to simulate as many scenarios as possible and to make the application so it can handle everything. It seems that we managed this up to this moment!

3. Moreover we think that it may be an application too generous in functionalities and we think of limiting the access to some of them. For example, employees from ultra-democratic organizations (they really exist!) won’t be able to see the whole list of employees to evaluate, but one by one, as they finish one evaluation being able to see the next one. This is just because curiosity and communication desire determine discussions between employees that can interfere with the results’ relevance.

4. We found out that the initial sales presentation was boring. We are working at a more interesting one. Meaning, making many of them, as interesting is an extremely generous concept.

5. From the consultant job we receive the confirmation of what we already knew from the one of recruiters: more than what evaluations reveal, the employees’ behavior towards the evaluation process is important to. There are employees who take matters into their own hands and implicate themselves, and employees who “sabotage” the process, postponing as much as they can the evaluations, who want to be asked over and over, putting others in the position of waiting with no justified reason. The motives are complex and we’ll talk about them some other time: are related either to trust in their own person or trust in the process, or either to the implication degree or adhesion towards the company.

6. In the sales process a new functionality was mentioned that slipped our thoughts: the fact itself of announcing the employees that they will be evaluated determines them to work harder and have better results. And it is true!

7. It’s a preparing point for those who wait for the evaluation conclusions: as bad as they would be, it is fine that they are! Persisting in your mistake is far worse!

Here is a list with the most frequent appreciation errors:

• Indulgence / severity consist in grouping grades on a value scale, only in the positive/negative part of it and not on its whole range, as it should be. It is the most common evaluation error, the motives being extremely visible: being indulgent, the evaluator avoids possible dissatisfactions or unpleasant conversations with the employee; being severe, on the other hand, is simple because it reduces to silence the evaluated, or the evaluator is simply taking vengeance, if there are misunderstandings between the two.

• “Center” tendency can be seen when the evaluation results indicate that the majority of evaluated employees present the same level of performance (possible but improbable). This error penalizes performant employees and favors the one with poor performances. The “center” tendency obstructs the process of identifying the employees apt to promote.

• Proximity error occurs when valuations take into consideration the most recent activity, deployed in a period very close to the evaluation period. Slip-ups and even accomplishments from the beginning of the evaluated period are forgotten. These errors favor the ones who made mistakes in the beginning of the evaluated period and penalize those with recent errors.

• Contrast / similarity errors consist in the evaluator’s tendency to appreciate employees in comparison with himself/herself or with own performances, which therefore become an evaluation standard. Moreover, how most of the times the evaluator thinks about himself/herself as being extremely performant, a very severe and wrong evaluation will result for those who are less competitive.

• Halo effect defines the extension of a positive or negative characteristic of the employee to all his/her other characteristics. For example, a great communicator can be perceived as a great team player or excellent organizer, even though he/she is not one. A positive halo is produced when the evaluator appreciates the employer’s performances relying on a general positive attitude. In contrast, the negative halo reduces one’s qualities based just on one characteristic with low score. The result of such an error is that the evaluated gets the same grade on every aspect of the job performance, irrespective of the employee’s real value.

• Personal preferences, preconceived ideas and other disruptive factors can give rise to error of performance appreciation. Managers with the tendency of letting themselves influenced by such external opinions, search for a confirmation in the employee’s behavior of such opinions. Preconceived ideas, of any kind, are extremely dangerous in the managerial practice and must be controlled and disputed.

• First impression has an important role in the evaluator’s appreciation of an employee’s activity. First impression detects a slight part of one’s behavior; however, we all remember this impression, even if we confront with a contrasting reality. The “first impression” effect can be seen especially in the case of a newer employee, because prolonged experience with a person can demolish it.

How can we minimize the effect of such wrong perceptions? Evaluators must separate themselves from their own person when evaluating, and in the case when evaluations take place in intervals longer than 6 months from each other, to take notes constantly on the employees’ results and errors.

A great deal of help in reducing wrong perceptions should come from the evaluation process itself. Choosing a great number of evaluators in different hierarchical and functional positions than the candidate reduces the risk of wrong appreciations. In addition, the construction of the evaluation grid or questionnaire can reduce errors in appreciation.

Finally yet importantly, exercise and experience have a strong word. Therefore, at first, such errors are more frequent, but as the performance evaluation becomes an organizational constant and a process in which every employee, evaluators and evaluated, take part regularly, their incidence is reduced drastically.

ITEX 440 helps you minimize performance perception errors by keeping a history of results recorded in each process of evaluation and by offering a number of comparative reports.

Why took us so long? We needed to be sure that we created a stable and safe product. Better later than for nothing!

Let’s take it a step back: why did we think of launching an evaluation application? Because our consultancy experience, so far taught us that non-performance is contagious. It spreads as a disease, very fast, and the manager’s tolerance towards it is the main risk factor. Valuable employees with the potential to accomplish much, become unmotivated just seeing those employees who don’t accomplish much but are still paid. The employees who are able end up not wanting, exactly as those not wanting because they aren’t able. That’s why we created ITEX 440!

And what does dance have to do with it? Well, much more to ignore it. Did you know that when we dance our brain has similar reactions to the situations when we have positive results and are praised? Did you know that only dancers are artists and art at the same time, work and result alike? And last but not least, isn’t it true that “performance” means both an artistic act and the performance that every individual in every company aspires after?

We therefore created a story meant to make the process of evaluation not only serious but also agreeable. We hope we succeeded!

We thank all of those who were a part of this wonderful project, who made superhuman efforts all of this time. We also thank you, for being near us now. We hope to dance “a more than 360 degrees”, our dance, very soon!

A company’s economical performances are directly proportional with the performances of the people that form it. There can’t be set new objectives, the activity can’t be strategically planed, if the strongest and weakest points of the employees are totally unknown.

That’s why ITEX 440 was created, as a managerial instrument both useful and necessary, which helps you know the quality of your human resources, what competences and abilities are sufficiently developed, how strongly the company’s values are interiorized and more important the results obtained by the employees, therefore predicting future realizations or action plans.

The application is based on the Software as a Service principle, offering multisource feedback: each employee can be evaluated by more evaluators being in different hierarchical and functional positions and by himself/herself or by people outside the company (internal/external clients, partners, providers).

ITEX 440 is structured in two functional areas: the area administering the evaluation projects which can be accessed only by the administrator of the application and the area referring to the evaluation itself which can be accessed by all the people implicated in the evaluation: employees or external evaluators (clients, partners, suppliers).

Being a very generous and easy to use application, ITEX 440 allows you to administer with few efforts the evaluation processes or projects inside your organization or group that you lead.

In case you don’t have the necessary information to set some evaluation indicators and to create a questionnaire, our consultants offer you a standard one. Based on a rich practical experience and structured into four sections: competences, motivation, adhesion towards the company and results, the standard questionnaire covers a wide area of performance indicators, both for managerial positions and for executive positions.

For more information regarding ITEX 440 functionalities and licensing policy, visit  the following sites: www.itex.ro and www.itex440.com .

ITEX is a recruitment and consultancy firm, also developing HR software, based in Romania in 2006. Clients portfolio include well known companies like TBI Leasing, TBI Credit, Novensys, UTI, Vendio, Bluespace, Top Factoring. The company’s products portfolio also includes MyRecruiter, an application that manages recruitment projects intended for the recruitment departments inside companies but also for recruitment agencies.

In the recent past of local HR management, performance management didn’t exist as a concept, being assimilated by the evaluation of performance. In turn it consists in appreciating the degree in which the employee is fulfilling his/her responsibilities, in relation with the occupied position.

In modern acceptation (at least theoretical, as practice is kind of a killer), performance evaluation has become a component of an extremely complex system, called performance management.

What is performance management and what good does it bring?

Performance management represents the sum of strategic interventions which influence on a long term the organization’s activity, leading to improved economical results. In fact we are talking about a set of actions especially thought to improve employee’s, department’s and the entire company’s results.

As an element of this system, performance evaluation represents a periodical retrospective analysis of the results obtained as a sequel to unroll the proposed strategies.

Besides evaluation, performance management also includes (in a simplistic scheme): defining the roles of each department/individual, setting parameters of performance (what performance defines); setting performance standards (which is the optimum level that indicates performance); communicating the roles, parameters and standards and last, but not least, ensuring a favorable environment for success.

The difficulties of such intercessions come from the hardness of defining the concept of performance itself. Is performance a behavior which leads to good results or does it represent the results themselves, the effect of such behaviors? The answer is dual, the core of an efficient management of performance being both behavior parameters and expected, assumed and obtained results.

As for the behalves, even it may sound like a pleonasm the main benefit that comes from an efficient performance management system is the performance itself.

The factors that influence the performance management

In general it is considered that a company’s lack of performance is exclusively on account of its employees. However there is a series of internal and external factors that can disturb the results of an organization, like: organizational environment (there are relaxed companies and paranoid companies of which environment bloc individual initiative therefore success), the style of management (dictatorship generates less accomplishments than democracy),socio-economical environment in which the company activates (when the economic context is favorable, it’s obviously easier to be performing), direct and indirect competition (how numerous, how aggressive it is and what placement does it have). That’s why the performance management must be a continuous preoccupation of the entire managerial team and not only of the human resources department and must always have in site the general context, not only punctual elements.

What performance management is not?

As redundant as it may sound, I mention again that “performance management” isn’t synonym with “performance evaluation”. Between these two concepts is an inclusion relation, the first totally subsuming the second.

Performance management isn’t an action past oriented, based on analysis, but one oriented on the future, on development.

Performance management isn’t an ascertaining process, but a transforming one. It’s not sufficient to observe that you didn’t perform in the past, as to obtain better results in the future. Managerial interventions are needed, changes that can fulfill this thing.

Performance management isn’t a form of coercion or control. Its role is to optimize results, not to penalize individuals or departments.

Performance management isn’t an instrument for salary or benefits packages increase. Its role is to improve employee’s activity on long term, not to motivate them on short term.

Performance management isn’t a way of dumping unproductive employees. Even it is possible they become victims in case their performances constantly remain under the desired level the performance management isn’t proposing to get rid of employees but to increase productivity. ]]> http://itex440.com/new-on-the-dance-floor/performance-management/feed/ 0