How to Measure Employee Performance

5 Ways to Measure Employee Performance

All managers want to be able to track the progress of their staff to ensure they are reaching their objectives, just as all employees want performance feedback that is deemed credible.
Performance appraisals are often conducted by managers to measure employee performance; but there are other tools that can also be used to steer away from unintended subjectivity.

Here are 5 effective ways to measure employee performance

Employee Appraisals

First, let’s take at a look at employee appraisals, as this tool is almost always used by managers to measure employee performance. This type of tool is usually conducted by an employee’s direct manager. The most effective appraisal tools include both a subjective and an objective element. How to Measure Employee Performance

The subjective component will most likely conclude how an employee performs against standards. All measurements should include some type of qualitative component. Many times to include a qualitative component a manger will be asked to rate an employee on their ability to exhibit flexibility, work in teams, as well as their ability to think analytically.

Self Appraisals

Another important performance tool is self-appraisal ratings. This allows an employee to actually rate his or her performance. Using such a tool usually leads to an employee accepting the performance appraisal processes, especially when their scores and managers’ scores are similar. In most cases, if the scores are not similar, a tool can be used to provide a vehicle. This vehicle is used to facilitate discussions that relate to manager expectations and then also the employee’s self-perception.

360-Degree Feedback

360-Degree feedback tools are used by many managers to measure employee performance. The feedback received through this tool comes from customers, peers, managers, and direct reports. Most times a self-appraisal tool is incorporated into a 360-degree feedback tool. This type of tool works best when the atmosphere found within a corporation is one that promotes open, sincere and truthful communication, as well as employee growth. This type of tool should be implemented as a positive criticism tool, not one that punishes employees.

Management By Objective

A management by objective tool is used to set employee goals (or objectives). This type of tool can help set daily, weekly, monthly, quarterly, and even annual objectives. Once an objective time period has ended measurements are then conducted and reviewed to see who met their goals. This type of tool should also be used in a manner that does not punish employees, but identifies which employees need extra training or guidance to boost company sales.

Balanced scorecards

Balanced scorecards are often used at the highest business unit level; however, they are effective tools for a manager to implement as well. They help align and facilitate organization goals by measuring quantifiable data, such as accounts receivable turnover rates.

All organizations should experiment with different employee performance tools. Many times a company will find that one tool works much better than another or that combining several tools actually yields optimal results. The important thing is to use them according to the needs and wants of the company and its employees.

This was a guest post from Todd Shipley. Thanks, Todd!

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