Employee Evaluations – Read the latest issue of The Total View – July 12, 2006

Welcome to the July 12, 2006 of The Total View
published by Success Performance Solutions, Written by Ira S. Wolfe =============================================
What’s Inside:

     1.  Employee Evaluations Drive Performance and Profits

     2.  Perfect Labor Storm Alerts #551 to #553

     3.  Perception 360 Degree Feedback – Multi Rater Assessment (MRA)

     4.  Quotes from Hire Authorities

     5.  Eleven new health care templates added to JobClues

1.   Employee Evaluations Drive Performance and Profits
It goes without saying. If you have ever terminated an employee for poor performance, the experience is disturbing and costly – both stress-wise and economically.

Two keys to avoid involuntary terminations, the politically correct term for giving an employee the old heave-ho, is first to hire the right person right off the bat. After they’re on board, managers need to monitor their performance and provide feedback. Monitoring employee performance means having accurate measuring systems of individual performance.

For organizations to grow, these employees need performance information to correct performance problems and assess the effectiveness of their improvement efforts. Individuals need feedback about their strength and weaknesses.

Sloppy performance management was not an issue for employers even as late as the 1980s. As recently as 1982, sixty-two percent of the value of an organization was measured by its tangible assets. By 2002, nearly eighty percent of its value shifted to intangible assets, Yes that’s right, the human capital of any organization now accounts for eighty percent of its value but until recently balance sheets still gave priority to equipment and buildings over its people.

A recent survey by Watson Wyatt confirmed that the annual performance appraisal has become so inadequate that many companies are abandoning appraisals in favor or a year-round evaluation and career development.  The majority of the employees in the study did not understand its company objectives and did not believe their performance is routinely evaluated or rewarded in line with those objectives.   

One problem with current employee evaluations is that even poor performers receive incentive bonuses and annual pay increases averaging 2.5 percent.  With top performers’ increases averaging 5.6 percent, the pay differential between top and low performance is too small to drive behavior.

But the tide is turning. Smart organizations finally seem interested in optimizing the way these precious human assets are managed. Establishing an effective employee evaluation system is an organization’s way of doing just that.

Employee evaluation is more than having a form completed once a year and stuffing it in the employee’s file just in case you ever choose to discipline or terminate him or her. Effective performance management is about linking individual performance to corporate strategy and providing continuous feedback, positive and constructive.

Another hurdle for managers to jump is that most employees aren’t being evaluated consistently. Performance reviews are scheduled willy-nilly, to address a problem or discuss next year’s wage increase.  For those who do receive timely periodic reviews, they aren’t always fair. Traditionally this lack of frequency, consistency and fairness has been a concern only for the HR department. Employee performance reviews have been avoided like the plaque and managers scattered when they saw HR walking down the corridors with those dreaded employee evaluation forms.

That is all about to change. Dollar signs are singing a new tune and the ears of executives and other business owners have perked up. CEOs, COOs and now even CFOs have caught the beat and are forcing managers to get a little rhythm. The traditional dance that managers chased managers to their cubicles has all of a sudden forced them center stage in many organizations.

Why all the fuss? In an 11-year study that included more than 200 companies from 22 industries, the financial and operational performance measure of companies who "lived" performance management and those organizations who did not was compared. The economic impact of this study was enough to give any executive chills up and down their spine – or just want to throw up his/her hands and cry.

The revenue growth for organizations with performance enhancing culture was 682%; for those without, these organizations grew by 166%. While many organizations might be happy with 166% growth, you’ll probably want to keep reading. The net income growth (the bottom line) of the performance enhancing organizations grew by 756% while their counterparts grew by a measly 1%!

In a second study representing 2,800 firms, the top 10% verses the bottom 10% were compared. At the conclusion of the study, the top 10% sales per employee were $617,575 compared to $158,101 for the bottom ten. The turnover rate was 20.87% to 34.09% respectively. The combined results of these and other factors resulted in a 391% Return on Investment for the performance enhancing organization.

What can managers do to turn compliance-focused annual employee reviews into performance enhancing systems? The first place to start is by establishing three major goals for the system:

1) Help individuals to achieve specific performance objectives in order to be successful in their organizational role and to develop their skills and abilities at a personal and/or professional level;

2) Ensure that these objectives and individual skills development is linked to company strategic initiatives and the bottom line; and

3) Meet not only short-term but long-term development goals over a whole career for an individual.

Success Performance Solutions offers several solutions to managers and an alterative to the ineffective and time-consuming employee annual review. The Janus Performance Management System provides a comprehensive, step-by-step planning design to help manage this process effectively. Janus not only provides a suite of goal setting and appraisal forms and templates to help this action planning process, but also helps to ensure that all written documents are in plain language, complete, comprehensive, and easy-to-use. To read more about Janus Performance Management System,

For 360 degree (multi-rater) assessments, continue reading.
2. Perfect Labor Storm Alerts #551 to #553

Fact #551:  The amount of time workers age 40 and older miss due to an injury or illness is greater by nearly a third than time off by younger workers. (Source: UnumProvident, Health & Productivity in the Aging American Work Force; Realities and Opportunities)

Fact #552:  Workers older than age 40 account for 50 percent of all short-term disability claims and up to 75 percent of long-term disability claims. Primary reasons for long-term work disruptions for age 40 and older include impairments fo the musculoskeletal and circulatory systems, as well as mental and cancer disorders.(Source: UnumProvident, Health & Productivity in the Aging American Work Force; Realities and Opportunities)

Fact #553:  Additional risk factors such as smoking, lack of exercise and obesity can result in health-care costs for workers age 40 and older that are nearly 300 percent higher than the younger workforce. (Source: UnumProvident, Health & Productivity in the Aging American Work Force; Realities and Opportunities)

Don’t be caught in storm without all the facts. "The Perfect Labor Storm Fact Book: Why Worker Shortages Won’t Go Away" is a must-read leading edge forecast that predicts workforce trends for decades to come. Order your copy today – Only $7.95 at http://https://www.perfectlaborstorm.com

3.  Perception 360 Degree Feedback – Multi Rater Assessment (MRA)

Perception 360 is a Web-based assessment designed to meet a variety of needs and applications necessary for increased personal productivity and effectiveness.

Perception 360 lets you design your own 360 surveys using our standard questions, writing your own survey questions or simply using our ready-made surveys. Your surveys can contain any number of questions and have an unlimited number of respondents. We do not charge by the number of respondents. You simply pay per target person (each person you wish to receive feedback from others).

More about Perception 360:

4. Quotes from Hire Authorities

Efforts and courage are not enough without purpose and direction.
John F. Kennedy

5.  Eleven new health care templates added to JobClues

Eleven health care job templates have been added to the JobClues Personality Assessment Suite.  The CLUES™ personality and Cognitive Assessments provide reports describing an individual’s core behavioral traits and cognitive reasoning speed. The reporting describes the participant’s core Personality and Cognitive measurements in the context of various job categories and what affect they may have on performance in that type of job.  It then provides specific behavioral interview questions based on how the participant scored in various areas.  The new health care templates target the following positions:

Medical Billing   
Lab Technician   
Nurse Assistant   
Pharmacy Aide   
Direct Healthcare Support Professional   
Direct Healthcare Supervisor   
Program Manager   
Registered Nurse   
Medical Assistant   
Emergency Medical Technician   

For more information about JobClues, go to:

Contact Information:
Success Performance Solutions  2137 Embassy Drive
Suite 218  Lancaster, PA 17603

email: iwolfe@super-solutions.com
voice: 717.291.4640
website: http://www.super-solutions.com.

Ira S. Wolfe Copyright 2006 – All Rights Reserved. Reprints and other distribution by permission only.


Ira S Wolfe