Organization Espresso

Performance appraisal is a critical task in any organization, it not only a tool to measure and boost human resource productivity but also a critical aspect to consider while measuring organizational performance. With the changing face of the way new organizations are evolving, these are the times where the win-win between employee and organization lies in the former adding value in more than one aspect and the later providing the opportunity of doing so. This has brought us to a dramatic rise the matrix structure of the organizations, which is becoming increasingly common. Even the traditional functional organizations are gradually moving towards weak matrix organizations.

The performance appraisal specially becomes a huge challenge in case of matrix organizations where the responsibilities, managers and expectations keep on changing. Though the basic fundamentals of appraisal techniques like Straight Ranking, Critical Incident, MBO, 360 degree and Interview etc. all hold good, what becomes a challenge is the implementation. Once the appraisal technique is applied the process of fitting the appraisee in normal curve or straight ranking or any other performance measure is where the large amounts of subjectivity is introduced which largely depends upon the relationship between the appraisee and appraiser.

In a matrix organization there are two schools of thoughts on managing the appraisee-appraiser relationship

1-      Direct Relationship- This is where an Appraisee – Appraiser direct interact with each other for the work. Essentially the appraisee generally assigned to the project being led by the appraiser. The primary benefit in this model is that the direct oversight and experience of the work is considered in the performance evaluation. This model also directly links the performance appraisal and thus the rewards & recognition directly with the current line of work making the matrix stronger. On the other hand the model of direct relationship has some serious pitfalls; since in the case of matrix organizations where the direct relationship is transient there are often cases where the appraiser changes leading to change in work style, expectations and relationship. Also this change in appraiser brings in the subjectivity or self interests from the point of view of contribution to the current work instead of work done in the past.

2-      Indirect Relationship – This is where an Appraisee- Appraiser are not supposed to directly work with each other. The appraiser is an independent evaluator who has not worked with either of the people he is evaluating and relies on the feedback mechanism from the direct managers of the matrix regarding the appraisee. The primary benefit of this kind of method is that all the people being evaluated are placed on an equal footing thus penalizing or ignoring due to subjectivity and transition is rare in this kind of scenario. This ensures that all the evaluation is fair and projects a accurate picture of organizational performance. Also since the evaluator remains same over the period of time, this allows a uniform set of expectation and development direction. The major drawback of this model lies in the fact that there needs to be an excellent feedback mechanism and the structure is easily prone to pitfalls of power matrix in organization.

Though both of the techniques are relevant and come in with their own set of advantages, I particularly feel that the right solution lies in a system which is a mix of two. As the subjects of evaluation move up the hierarchy pyramid of the organization shifts to weaker matrix the evaluation style should be a direct relationship on the other hand when subject lie in the stronger matrix of the pyramid the evaluation method should be indirect relationship.

My reasons why I support this kind of structure are

• Consistency in the type of expectations and feedback can be used the performance evaluation to be mapped to the organizational objectives
• At the lower side of the pyramid the motivation is generated from the fact that employee has a voice in the system apart from his direct report
• Establish a personal connect in the lower side of the pyramid where the transitional nature of work lowers the emotional connect with the organization
• Since the personal dynamics of work place is not involved, the appraisal system at the ground level is seen fairer. On the other hand where the roles are not transitory in nature and personal rapport becomes a factor of performance the evaluation keeps a track of it.
• This kind of a structure is easier and faster to realign, while accommodating tactical and strategic changes in the organization direction and performance
• Closer and direct involvement with the current work at a higher level creating a stronger performance culture which gets driven down but doesn’t gets negated due to transitional nature of work.

So what do you think is the best method for a practical implementation of performance evaluation and appraisal in matrix organization?

by Prats | on Friday, August 5th, 2011 at 6:54 am | General Management, Personal Management . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.