Saturday, December 26, 2009

Performance Rating or Quota System

That was first Monday of May. I just finalized the list of officers and engineers who were selected for 2-year Executive Management Development Programme (EMDP) which was suppose to commence from Jun end. EMDP was sponsored by the company and was affiliated with renowned management institute.

Let me tell about the course.

Criteria for selection were as under:

1) Employee must complete minimum five years with the company.
2) He should be rated minimum “Meets Expectations (ME)” during last three years Performance Appraisal.
3) He should complete other training programmes related to the managerial and executive effectiveness. (These programmes are residential programmes from 3-8 days)

Methodology for selection was as under

a) Every year the list of the officers who fulfils above criteria is declared,
b) Management Institutes carries Entrance Test (Written, GD, Presentations and Interview)
c) The participants are assessed thoroughly.
d) Final list of successful employees is declared for the course

Employees who are selected for the course have to sign three years Bond with the company. During the course every participant has to give the presentation on the progress and he has to take one developmental project in a month. This course has to be done after officer hours. Management Institute has designed the programme, which suits the requirement of the company and its business.

30 Employees were selected for the course and I sent the list to my VP for his final approval.
I relaxed as I completed one task. The whole process was smooth. VP called me on phone and told that the list is fine with him. I just made a circular with details plan for communication. I save the file and was suppose to fire the print.

I saw Mr. Pradeep Jani coming towards me. Pradeep is a Sr. Manager and a very good Automobile Engineer who was handling the team of 10 engineers and around 150 blue-collar workmen on assembly line. He was known for his short temperament and for his reactive personality among all the employees.

“Come on Pradeep. How are you?” I asked
“You people are not making me fine” he responded
“What’s happened yaar, we are here for you, tell me what’s happened?
“Tell me what the criteria for the selection for EMDP?” he asked. I explained him whole process.
“If your process is so through why I was not called for the entrance test? I am an old employee, competed almost 11 years in the company, I am good engineer. My performance is good. Then why I was not called. Raman who is junior to me, new in the company got the opportunity?” He blasted on me.
“Cool down Pradeep. Let me check the case, will you take a coffee?” I got two cups from vending machine.
Pradeep was furious on me and was holding me responsible for not calling him for appearing for the test.
I check the personal history of Pradeep and told “Pradeep, I am sorry, but you are not consistent during last three appraisals”
“How? How you can say this?
I explained him about that data which was available on HRIS. Data shows that Pradeep was rated ME two times and one time RME, i.e. “Reasonably meets expectations”. It means he meets expectations, but need more consistent in his work. He agreed with the data available.
“Oh, Vinod, I was not knowing this fact that my rating will be linked everywhere. Otherwise I had not agreed with…..” He left the sentence in between.
“Yaa, tell me” I asked him
He was reluctant to tell. I decided to go in detail.


“When last time, our Performance Appraisal was done, I had a long discussion with Mr. Ramchandran (Pradeep’s immediate boss). He was fully agreed with the achievements I had done. However he told me that he had to rate the employees in different tiers (i.e. Performance classification). I was rated “ME’’ for last two years. He told that there would no effect on payouts (i.e. Performance Bonus) though the overall rating is “RME” This year he will rate me “RME” because he had decided to rate other and everybody should get the opportunity.”

Every department head has to follow the performance bell and during every appraisal, the employees would be classified in different tiers. The department head decided to classify the employees not on Performance but just on quota system. The purpose of the performance appraisal and classification is not at all achieved.

This may happened in most of the organizations. The line managers are responsible to break the system. Managers are for planning, organizing, assessing, for everything. It is a democratic way to rate the people in different performance tiers.

But then if something goes wrong the employees and even his line managers will first blame HR. I don’t know when the line managers will be responsible and accountable for the performance of their team?

(This story is reproduced. I had already published this story 2-1/2 years back on different forums.)


pratiksha said...

Good eye opener.

sanjayrakecha said...

I do agree with u HR people not responsible for everywere. Other influance is also resposible for the same . In one co Director recommanding HR people to whom training will be given. The result -all director fevorable employee get chance. but those who perform very well will be on side track. This is happaned in our country.

Anuj said...

Truely ...a Good eye opener...almost every HR Individual will relate to this.. for every employee issue HR is directly/indirectly held responsible..say it a recruitment eror, retention issue, but no one takes notice of the actual problem an employee faces in his/her particular dept..Good..but we should do something for this..may be by raising this issue in the HR conferences we do attend!

Thanks Vinod Sir!


PravinK said...

Exactly Vinod, this is what happened in many organisation.. I do have experienced it in my organisation.. HR begin service/support dept norally held responsible for errors in any of the process. Techies can easily find their way out of it and they do not bother about it.

Vipul Agarwal said...


This is a good one. What immediately strikes is the managers comment that the performance has to be measured on the bell curve. Obviously, which means that the manager follows a quota system as aptly pointed by you. However, it would be interesting to figure out how the manager got into the practice of rating people on a bell curve- it seems obvious that he has been taught to do so by someone in the organization. That someone could be a past senior or could be peers (grape vine or informal communication) or directly from the Top Management (thru HR ofcourse).

The remedy obviously has to come as a communication from the HR Dept or the Top Bosses.

But this malaise does not stop here. Many organizations have this system of forcing a bottom 10% or a Top 5% rating from the appraisers. The infamous or famous (depending upon your point of view) practice followed by Jack Welch - is just that. Forcing a bottom 10% and then giving them a boot. In such scenarios Managers very quickly learn that they need to have scapegoats to be chucked out of the system and it is not the actual bottom 10% that is ousted.

Nandini Agarwal said...

1. Can you trace out the problem from the above discussion? Name the method used for appraising Pratap by his boss Mr. Ramchandran and draw its merits and demerits.

2. If the above company wants to open up Retail Chain store, what sources of recruitment would it be goingfor?

3. Knowing the short temper nature of Pratap, which method of training would you suggests and what are the advantages of the method mentioned by you. Mention various methods of training also.

4. The tendency of evaluating an individual high on many traits because of a shared belief. People tend to think that overweight people are lazy, thus evaluating on the basis of negative quality. What are the terms given to these common interview mistakes and how are these two related?

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