How Contemporary Organisations Can Most Effectively Use Performance Appraisal - Essay Example

How contemporary organisations in the UK can most effectively use performance appraisal to improve how their employees undertake their work Many organisations in the United Kingdom have had a history of performance appraisal as part of their management practices. This approach formed the basis upon which organisations performed their key functions such as selecting employees, rewarding them and planning for their career development within the organisation. Although this has been the practice of organisations for long, there have been overall fundamental changes in the general practice of performance management. As a result of this, many organisations in the UK and across the world have adopted modern approaches to performance appraisal practices. Unlike the old approach that was based on subjective observation on a selected type of employees, modern approaches involve systematic processes of appraisal that are applied to all employees at all levels of the organisation. This essay assesses how contemporary organisations in the United Kingdom can most effectively use performance appraisal to improve how their employees undertake their work. To begin with, performance appraisal can be defined as a systematic process of by which the job performance and potential for future development of employees is evaluated (Boone & Kurtz 2011, p. 252). This means that the assessment takes into consideration both the past performance and the future potential of employees within organizations. One way in which contemporary organisations in the United Kingdom can effectively use performance appraisal to improve how their employees undertake their work is by using performance appraisal as a tool to resolve general challenges which the employees experience at their places of work. This arises from the knowledge that many contemporary organisations in the United Kingdom are experiencing a myriad of challenges which affect the performance of their employees (Meadows & Pike 2010, p. 129). This is the case for organisations in other parts of the world as well. For instance, since many organisations face the challenge of ensuring that their employees receive adequate rewards and recognition, the management of contemporary organisations can successfully resolve this issue by using effective performance appraisal procedures. Through appraisal interviews and other practices that form the performance appraisal procedures, organisations can effectively identify the contributions made by each employee to the organisation. This facilitates the implementation of a clear reward system that is commensurate with the individual effort of employees (Grote 2005, p. 78). It is important to note that in general, the reward system for employees within an organization is influenced by the psychological contract between the employees and the management (Deb 2006, p. 142). This is represented by perceptions about the existence of fairness and balance between the input expected from employees by the management and the treatment the employees receive from the management. Also, organisations can establish effective supervisory and other support mechanisms for employees in the workplace using performance appraisal procedures (ACAS 2011, p. 8). By addressing such kinds of problems in the workplace, organisations can effectively enhance the performance of employees by using performance appraisal systems. This is because performance appraisal plays a key role in addressing the needs of employees with regard to key performance management strategies. Apart from the problems of reward and support for employees, many organisations face problems to do with employee retention, efficiency in teams and general wellbeing of employees (Perkins & Shortland 2006, p. 53). These problems are manifested within organisations in different ways. For instance, the willingness of employees to stay in organisations for long is as a result of issues to do with remuneration, the nature of the work and general professional development, among other factors (Perkins & Shortland 2006, p. 60). When these factors are not aligned, an organisation is likely to experience a high rate of employee turnover. It is important to note that this issue is common in many contemporary organisations in the United Kingdom (Sparrow 2008, p. 134). Since performance appraisal provides an opportunity for organisations to examine how satisfied their employees are with the working conditions provided within the organisation, the process can be effectively used by organisations to improve these conditions at the place of work. The issues that arise from performance appraisal, with regard to how employees perceive the prevailing working conditions, provide information which the management can use to develop strategies to improve the overall working conditions in organisations. Such a strategy would seek to improve motivational factors that enhance employee performance such as rates of financial rewards, involvement in decision making processes, availability of training opportunities, flexibility and open communication. Also, since performance appraisal process entails sessions where the management discusses issues with the employees being appraised, the process provides opportunities where the management can discuss issues of general wellbeing of the employees (Grote 2005, p. 88). As such, organisations can learn different issues that affect the wellbeing of employees. If such issues are caused by conditions within the organisation, the management will then be in a position to improve the experiences of workers as well as remove any potential stressors in the workplace (Meadows & Pike 2010, p. 132). This improves the effectiveness of employees in performing their duties. Another way in which organisations in the United Kingdom can use performance appraisal to effectively improve how their employees undertake their work is by using the results of performance appraisal to transform their organisations into those that have high performance work practices as part of their culture. According to Staehle (2000, p. 120), high work performance practices can be defined as a set of practices of organisations that cover three main areas: human resource management practices, practices that enhance reward and commitment in employees and lastly, high employee involvement practices. From this definition, it can be seen that work appraisal plays a key role in enhancing effective human resource management practices within organisations. Many organisations in the United Kingdom have sought to establish work performance practices as part of their culture in the recent past. For instance, recent surveys indicate that over 95% of all organisations in the country have established comprehensive performance appraisal for their employees (Kusluvan 2003, p. 30). Although there are variations in terms of methods, approaches and frequency of application for the performance appraisal system, it is observed that organisations in the United Kingdom take performance appraisal as a key element of turning them into high performance organisations (Goel 2008, 36). As a result of the relationship between performance appraisal and overall human resource management practices, there is need for organisations to use the appraisal of their employees as a way of building high performance work practices. Although research indicates that the majority of organisations which have adopted performance appraisal focus on doing the appraisal once in a year, it is observed that others, particularly those operating in the hospitality industry, need to increase the frequency of performing such appraisals (Sparrow 2008, p. 136). This means that a continuous informal appraisal of the work of employees should be undertaken within organisations. This way, the management can use the opportunity to make positive reinforcements in employees as well as provide training in areas where employees have fared badly. Many contemporary organisations face a number of issues related to the process of performance appraisal (Harvard Business School 2007, p. 121). Many of these issues are appreciated where performance management practices are implemented and managed within organizations. For instance, many organizations experience tension between the competing objectives of the process (Harvard Business School 2007, p. 162). This is because the need to assess the performance of employees always competes with the objectives of allocating rewards to employees and identifying development needs within organisations (Fletcher 2004, p. 186). This means that the manner in which organisations manage the process may result into general resentment among the employees. Also, since many organisations have adopted an appraisal system in which the tradition is that the top managers appraise junior employees, there is the general problem of employees viewing the process as a toll of the management of the organisation. As such, the possibility of lack of trust and faith in the process remains real in many organisations (Boone & Kurtz 2011, p. 259). These weaknesses, therefore, affect the general performance of employees in organisations by reducing their efficiency, effectiveness and overall productivity in the workplace. Because of this situation, organisations can use performance appraisal to improve how their employees view the entire process. This can be done by using performance management practices that eliminate weaknesses in implementation and management, thus contributing to decreased performance in employees. According to Deb (2006, p. 166), organisations can improve their performance appraisal processes by evaluating it for potential loopholes. This is applicable to many contemporary organisations in the United Kingdom that have adopted modern approaches to performance appraisal such as 360 degrees and assessment centres (Meadows & Pike 2010, p. 139). An example is Tesco which uses the 360-degree approach for its performance appraisal. Such organisations perform appraisals for career development, learning and effective team performance of their employees (Sparrow 2008, p. 147). As such, organisations should evaluate their processes for any weaknesses in implementation and management of the process and initiate corrective measures. Such an approach would eliminate any weaknesses in the process, thereby enhancing the trust, faith and overall motivation of employees in the place of work. This way, organisations would be able to greatly improve the conditions under which their employees perform their work. Another way in which contemporary organisations in the United Kingdom can most effectively use performance appraisal to improve the conditions under which employees perform their duties is in the area of using performance appraisal as a tool for enhancing career development for the employees. Grote (2005, p. 145) observes that many contemporary organisations, those in the United Kingdom included, lay much emphasis on the issue of employees and their career development. The management of these organisations seeks to establish the success of the entire organisation on successful development of the careers of the employees. It then follows that organisations should use performance appraisal as a way of assessing different aspects that determine the career development path of employees. Aspects such as the attitude to work, competencies and the performance standards of employees should be evaluated comprehensively so that their contribution to the organisation and their overall potential is determined (Armstrong 2012, p. 213). When this is done, organisations are then able to link individuals with responsibilities that will enhance their career development both when in the organisation as well as in the future. As such, organisations would be able to improve how employees perform their duties by tying the objectives of the organisation to the career development plans of the employees. This will enhance the overall performance of employees within the organisation. One organization that has made steps in this direction is Tesco. With a current workforce of over 470,000employees, the company has adopted a highly flexible approach to employee training and development (Marr 2009, p. 4). Using job rotations, coaching and mentorship, the company provides its employees to assess their own performance under the 360 – degree appraisal system. This way, the company is able to align individual career objectives with those of the organization. In conclusion, contemporary organisations in the United Kingdom can effectively use performance appraisal to improve how their employees work by using it to address different factors that influence their overall performance. Performance appraisal can be used to provide solutions for problems of employee performance, enhance the career development of employees, and help establish high performance work practices within organisations. This way, the manner in which employees undertake their duties within organisations would be greatly improved. References ACAS 2011, ‘How to manage performance’. 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