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Appraisal: IT Industry

-SUDIP PAUDEL

Overview

1.) Assessing various appraisal methodology in IT industry

2.) Trend for salary hike in last 5 years in IT industry

3.)Trend for salary revision for next three years

4.) linkage between appraisal system and attrition rate of the IT industry

5.) Views/recommendations

What is Performance Appraisal?

Fulfillment of job requirement

Continuous development of human resources.

Potential

Periodic process

Both quantitative and qualitative evaluation of job performance

Features of Performance Appraisal

Appraisal methodology popular in IT industry

1.) 360 degree feedback system2.)Bell curve based performance appraisal system

A.) 360 degree Performance appraisal

♪Comprehensive feedback

♪ Highly effective performance evaluation tool

♪ Very reliable

♪ popular

♪ Realistic evaluation

Features of 360 degree feedback system

B.) Bell curve based performance appraisal system

Features of Bell curve based appraisal

♪ Compares employees performance relative to others

♪ Segregation of workforce

♪ Helps to differentiate individuals

♪ Well accepted

New trends in Appraisal…..

“Only in our dreams are we free, the rest of the time we need wages.”

-Sir Terry Pratchett

Trend for salary hike in last 5 years in IT industry

For the past five years, average salary hikes in Indian IT sector have been around 10 percent

Regional practices in the economy

Industry/company performance

Compensation policy of the institution

Supply and demand of labour,and

Individual’s job performance

Trend for salary revision for next three years

Employee with skill in verticals like cloud, mobility, social media and analytics will get huge compensation

Salary rate and incentives will be high for top performers

Average Industry salary is expected to grow at an annual rate of 6-9%

Salesforce employee salary could be determined by the revenue they bring from client

Linkage between appraisal system and attrition rate in IT industry

Attrition management has become the strategic focus and compelling necessity of business today.

The toughest concern for an HR manager is however the high attrition rate

IT industry has one of the highest attrition rate. Appraisal should be done fairly so that conflict , dissatisfaction and attrition rate gets reduced.

The share of attrition due to dissatisfaction in appraisal is also growing as techie are finding better opportunities at mushrooming startups and poaching is always there.

Problems with current appraisal process

People are inspired and motivated by positive, constructive feedback- and the “appraisal” process almost always works against this.

The most valuable part of an appraisal is the “development planning” conversation –what can one do to improve performance and engagement- and this is often left to a small box on the review form

Employees need and want regular feedback(daily, weekly), so a once a year review is not only too late but its often a surprise. Regular coaching is the key to alignment and performance.

Views/ Recommendations:-

Not only performance but also potential should be considered during appraisal.

Focus should be given to team performance also

We have a shortage of key talent and the keys to success now focus on regular alignment, coaching, creating passion and engagement, and continuous employee development.

Set and reset goals frequently. Companies that set performance goals quarterly generates 31% greater returns from their performance process than those who do it annually, and those who do it monthly even get better results.

Companies thrive by building skills-so in addition to encouraging managers to produce good work, HR should incent them to produce a good talent as well.

One more thing………

I never criticize anyone. There is nothing that so kills the ambition of a person as criticisms from superiors. I believe in giving a person incentive to work. The ultimate way to develop the best that is in a person is by appreciation and encouragement - Charles M. Schwab

THANK YOU

Annexure:-

Citehr.com

Quora.com

articles.economictimes.indiatime.com/

Slideshare.net/

Human Resource Management text and cases by VSP Rao

Forbes.com

Info.shine.com

Wikipedia.com