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Annual appraisals can cause lots of demotivation

The measure of good management is to constantly increase productivity and quality whilst reducing the amount of discord and unhappiness between members of an organisation. People are generally happy when they receive something but become unhappy when they discover what others receive.

Many organisations have some form of an appraisal system, but they rarely work. Then they reward people in an unsatisfactory manner.

A good appraisal and corresponding reward system is essential for healthy and productive management - employee relationship. Appraisals are meant amongst other purposes to determine a fair rewards and promotions system.

Appraisals are meant for determining rewards and promotions. It usually turns out to be a nightmare for owners, leaders and managers. No matter what we do some people tend to become unhappy and even angry. This can be highly demotivating and counterproductive.

Why is this so, and what can we do?

When appraisals are conducted on subjective basis, unhappiness is greater and that can not be good for morale and performance. When appraisals are conducted on an objective basis performers and non performers are easily identified by both appraiser and the appraised.

Therefore an important first step in good management is to set targets and then conduct periodical performance appraisals. If there are no realistic targets, then there is no utility in conducting an appraisal.

The second step arising out of an appraisal system is to reward performers by giving them higher increments, better facilities and promoting them as needed. This will bring out better performance in future and reduce the level of unhappiness. The non performers will instinctively improve if they can or have the drive, here the management has to step in and assist. Some non performers when they feel that the job is or the organisation is not for them will leave.

Objectivity will not make everyone happy, but it will certainly bring down levels of unhappiness.

People will accept the bitter and the unpalatable if they feel that justice has been done.

This can only happen if appraisal systems are,

  1. Objective: meaning they are based on facts and not on opinions.

  2. Transparent: meaning everyone knows upon what parameters and how people are being appraised

  3. Redressal: Everyone has a right to seek clarity on what transpired and place a request to review their appraisal and receive it.

If this is done then the possibility of getting the best from the team is very good.


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