Since the way of work is changing fast with consistent upskilling in focus because of taking over by new roles over old ones and hybrid working, business organisations are prioritising the resetting, redesigning and transforming the performance management and rewards process so that it meets the challenges put forward by new way of working especially after covid period. Technology adoption has also played a very crucial role. Things have changed a lot, so the processes have to be revisited.
It has been discussed at length and concluded in many research studies that annual appraisal system has lost attraction and relevance. In the background of fast becoming obsolete performance process which has been based on measuring the performance on a rating scale and linking it with annual increments, it should also be brain stormed about the process or system which should be capable of addressing the challenges of present and future work world.
Any performance management process which an organisation may develop should be based on validity, reliability, flexibility and employee centricity that is strong enough to connect with organisation culture. It can be short cycle based or real time with continuous feed back linked with appreciations and rewards instead of one- time annual exercise.
It should also be ensured that the focus should be on evaluation rather than mechanised measurement. Evaluation involves constructive and healthy feedback which is capable of inspiring employee’s growth and igniting positive changes. Since talent management is going to be one of the biggest challenges for HR in coming times, performance management process should also be effectively and genuinely linked with variety of rewards which carry greater value in the eyes of employees. Traditional benefits and rewards are losing shine particularly when in many organisations employees are preferring hybrid working. It is also to be kept in mind that employee should know as to how his rewards are linked with his performance and why he is paid along with its impact on overall organisation growth.
So, apart from manager’s excelling in conversations, building trust and communicating what organisation value most, what employees prefer and value most, should not be lost sight of. It has to be revamped. Also, the system should be highly customised that meets the needs of organisation specific.
The HR veterans of the country, in this this edition cover story, put forth interesting insights about the necessity of reworking on performance management system and rewards along with steps to address challenges and metrics those need to be taken care of while modifying the process.
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