Wednesday, June 13, 2018

Various Accounting and Non Accounting Techniques to Reduce Biases in Performance Evaluation(Leading Change)

The performance measure is a periodic and continuous management process that enables a manager to measure the work behavior of an employee and its impact in achieving common organization goal. Generally, the organization designs its reward systems on the basis of performances. A well designed, logical, scientific, equitable and transparent performance appraisal system not only limits itself with the pool of motivated employees but also creates a win-win situation for the organization and other related stakeholders.

A systemic and sequential understanding of various organization models is must to reduce the biases in performance measurement and it is also to be noted that, as postulated by system theory of organization, various departmental and interdepartmental variables impact the performance measurement as each are interlinked and correlated (Palmer, Dunaford, & Buchanam, 2016). In line with the Six-Box organizational model as postulated by Marvin Weisbord, ineffective or biased appraisal process could have detrimental impact on the existence of organization. Unfavorable relationship between employees could jeopardize the leader, similarly, the 7-S Framework also focuses on fair performance measure system so that other clutter like structure, systems, style, skills, strategy and integrated goals can create synergist impact.

Biases happen due to individual traits of supervisor/manager like favoritism, red tapes, skepticism, hypocrisy further cognitive bias creates halo and horn effect favoring positively and negatively respectively to any person (Poddar, 2015). Similarly, accounting errors laid inside the policies and practices of the organizations also generates biases. Further deliberate manipulation of performance appraisal for political purposes, such as to get rid of undesired subordinates, poor performers are also done. The impact of political influences could be less in the assessment of lower level jobs in organizations but might have a significant impact at higher levels within organizations. As per (Castilla, 2016) merit-based rewards can unintentionally lead to pay disparities based on gender, race and national origin and company can use date, transparency, and accountability to prevent such biases.

For the purpose, comprehensive training on fundamental of performances, workshop, and seminars should be organized for managers (Nischithaa & Rao, 2014); it helps them to erase their rooted stereotypes. Supervisor should review employee documents to gain the picture of past performance, and they should know the performance standards of jobs and compare their employees actual output with standard output Whereas, amendments in previous policies and guidelines are to be carried to make them useful. Except for the above mentioned psycho-analytical changes where supervisors are generally made aware with ethics of appraisal, the human resource department active participation in ratifying the errors in previous policies, laws, and guidelines should also be incorporated. The Six model approach and 7-s framework enforce that other interrelating factor that may affect the performance should be measured.

In lieu of 7-s model, the superordinate goal should create a win-win situation to an organization and its employees, means the targets should be appealing enough to come across the intrinsic and extrinsic needs of its employees. So that employees drive for achievement of goal, further, the structure of organization which focuses in differentiation and departmentalization should allocate right person for the right job, moreover, well-designed strategy which includes corporate, business and operational level strategies should be inclusive enough to define long-term vision, mission to organization. Moreover, a well-placed system(technology) with people able to use it or making them proficient enough to streamline each work with sufficient skills by development training, workshop, seminars is equally essential to make all employee stand in the same level of performance. Further awareness building programs for supervisors, 360-degree feedback collection for preformation evaluation and knowledge management could be other best option to enhance performance measurement.

If the above mentions, S-factors are in place, it led to streamlining each activity of organization making the measuring process transparent and fair. For example, if the strategies are not made properly for operational level employees, they can’t perform and ultimately their work might not add value to organization, ending up with poor performances measurements. Here the problem/biases in measurement are created from unclear strategies of management, not from the employee. Similarly, if training and management developments programs if are not equally provided to staffs, the performance of staffs abandoned from training will definitely be inferior. Except this, various quantitative techniques (Robertson, 2015) that measures the performance of employee should be revised. Understanding the employee turnover ratio provides insights for employee un-satisfaction, productivity per employee helps to measure average efficiency per employee, further to be more precise average weight mean gives proportionate output per employee.

So, various cognitive and external factor impacts the performance measurement process making it biased. Supervisor often uses the wrong lens, uses wrong tools and make wrong decisions. Sadly, due to information overload managers get blocked in cognitive overload (Osorio, 2016).  And the change managers could use above mentioned qualitative and quantitative methods (but not limited to) to alienate biases in performance measurement.


Bibliography
Castilla, E. J. (2016). Achieving Meritocracy in the Workplace. MIT Sloan Management Review.
Nischithaa, P., & Rao, M. N. (2014, April-June ). The importance of training and development programes in hotel industry. International Journal of Business and Administration Research Review, p. 51.
Osorio, C. A. (2016). Overcoming biases in your Innovation model. Spring Conference 2016: Digital Disruption and Empowered End user. Wharton School-Mack Institute for Innovation Management.
Palmer, I., Dunaford, R., & Buchanam, D. A. (2016). Managing Organizational Change, A Multiple Perspective Approach. McGraw Hill Education.
Poddar, S. (2015, January 19). www.linkedin.com. Retrieved July 21, 2017, from https://www.linkedin.com/pulse/biases-performance-management-how-can-overcome-sarajit-poddar-hrmp: https://www.linkedin.com/pulse/biases-performance-management-how-can-overcome-sarajit-poddar-hrmp
Robertson, J. (2015). Financial Ratio Analysis. John Rober

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