The Pros And Cons Of Abandoning Performance Reviews In Organizations, An Essay.

Employees play a significant role in organizations. The success or failure of an organization is therefore to some extent dependent on how effective and productive the company employees are. Organizations have therefore shifted their focus to inventing better ways and strategies to keep improving the productivity and motivation of their workforce. Employee performance appraisals are one of the strategies that organizations use to gauge and evaluate the performance of their employees with an intention of making them more effective and productive in their operations. If the process is carried out effectively, it can benefit not only the employees but also their employers because any improvement on the part of the employee is an improvement on the part of the organization. For an employee, it can facilitate identification of training needs which when solved can lead to the overall productivity of an organization. Performance review is the systematic evaluation of employee’s performance in order to identify their training needs and opportunities for future growth (Lo?pez, 2008). This report will focus on analyzing the potential advantages and disadvantages that Accenture will get from the abandonment of performance reviews.

There has been much literature written about performance reviews (Colville and Miller,2011) refers to performance review as a change process, which requires managers to understand the current state and the desired state of their organization. According to (Grote, 2012) performance review is a formal management tool used to evaluate the quality of employee’s performance. Pichler, 2012 Asserts that employee’s reaction towards performance reviews is largely determined by the quality of the relationship between them and their managers. (Cunneen, 2006), refers to performance reviews as the most feared process in the organization calendar. He also observes that the reason my many managers may not be comfortable with performance reviews is due to the fact that it leads to shallow decisions that may not actually improve the performance of employees.

Organizations make use of performance appraisals in order to meet certain targets mostly related to performance and productivity of their employees. However, the ability of performance reviews to achieve their intended targets is largely dependent on how they are carried out (Mosley, 2013). As for Accenture there clear indicators of the fact that the process has failed to improve the performance of employees as it was intended to at the time of implementation. For this reason, I am of the opinion that it was a good idea for the company because having failed to achieve its targets there was no use of its continued use.

The reason for this argument is that having failed to achieve its intended targets through the use of performance reviews, the organization needed an alternative. The process is also quite time-consuming and therefore expensive for the organization. It is evident that managers spend so much time reviewing the performance of employees and particularly for an organization like Accenture which has a workforce of more than 300000 employees the loss can be quite huge if we value the process in time of the overall timer spent versus the outcome of the process. Assuming that the organization pays their employees including managers on hourly rates of $30 for subordinate and $50 for managers and it takes approximately 3 hours to evaluate a single employee, the loss incurred would be equivalent to $ 79.2 Million. This is quite a huge amount of money that is unnecessarily wasted. This figure is the amount of money paid for unproductive hours in the organization for both managers and their subordinates (Tapamoy, 2008). It is true that managers spend so much time sorting and organizing employee’s files. On the part of employees also this is a process that causes so much anxiety and therefore employees spend so much time focusing on how the process might turn out to be. The time wasted can largely hurt the organization in terms of its overall productivity (Hayashi, 2012).The process does not only affect the productivity of individual employees but also that of groups within the organization as they also tend to spend much time discussing the process among themselves instead of performing their assigned tasks. The process is therefore appropriate because it will lead to saving of the costs that are wasted in terms of the unproductive hours associated with the process.

Evaluation of the Decision

Removal of performance reviews can be beneficial or unbeneficial for an organization depending on the angle in which it is viewed. The removal of the performance reviews has both its advantages and disadvantages. Among the advantages of the elimination o performance reviews is the fact that it will lead to immediate financial benefits for the organization that it will lead to immediate financial benefits by saving the $ 79.2 Million that is unnecessarily wasted. Among the disadvantages is the fact that by eliminating the process employees will be denied a chance to be evaluated and receive feedback regarding performance and their potential areas of improvement (winter, 2009). Performance reviews have also been used previously to identify good performing employees in order to reward them. This will however not be possible with the elimination of performance reviews (Aly & El-Shanawany, 2016). There are a number of motivating factors that have been attributed to improved employee performance. These include incentives for good performance and regular feedback from managers and supervisors. Encouraging words from managers to employees have also been found to achieve similar results (Osabiya, 2015).The implication of this is that removal of performance reviews will also lead to the elimination of incentives for good performance, regular feedbacks from managers as well as encouraging words from managers. This is likely to have an impact on the motivation of employees which will have an impact of on their individual performance and consequently the overall performance of the organization (Girdhar, 2008).

Among other areas that performance reviews have been of significance to organizations is that through evaluating employee’s performance, Managers can identify employees whose attributes and skills are no longer needed in the organization. The impact of keeping such employees in the organization is that they can affect the overall performance of the organization. These employees would, therefore, need to be eliminated from the organization to be trained or entirely eliminated from the organization (Cintrón & Flaniken, 2011).  What this therefore means is that with the elimination of performance reviews it will not be possible to identify these employees hence the organization will suffer in terms of its overall productivity and competitiveness. All these negative outcomes of eliminating performance reviews could end up costing the organization much more than it saves by eliminating performance reviews (Smither & London,2009).

The elimination of performance reviews does not mean that the organization will not be required to monitor, evaluate and improve their employee’s performance. The organization can use a number of strategies to achieve a similar outcome to that of performance reviews. The organization can focus on creating trust and improving employee’s commitment towards meeting g established objectives. This involves a mutual understanding with the employees of what is expected of them and providing an enabling environment to actualize that (Arthur & American Management Association, 2008).However, this strategy requires the involvement of employees in coming up with objectives as well as adopting the use of effective communication to make the strategy more effective.

It has also been found that employees become more productive in a situation whereby they are given decision-making authority and operate in an environment where teamwork is encouraged. The organization can, therefore, give autonomy to the employees and put more emphasis on collaborations within the organization in order to improve the performance of their employees. One of the benefits of collaborations at the workplace is that it results in the elimination of tensed relationships between employees and managers as well as among employees from different groups (Bacal, 2012). Teamwork within the organization will encourage performance-based discussions between employees and their managers. It will also facilitate necessary performance-based support which is likely to result in increased productivity among the employees. Giving autonomy to employees will improve their decision-making abilities which will lead to improved productivity among the employees.

Impact of Removing Formal Performance Reviews

Training and development programs have also been found to have a positive impact on employee’s performance. Employees who receive regular training have been found to be more productive than those who do not. The organization can use this strategy to improve the performance of their workforce because it will enable them to acquire the necessary skills. Productivity issue in an organization can also emanate from the recruitment and selection process. If best strategies are not used to recruits and select the most qualified candidates, an organization can run into performance related challenges (Adams, 2013).The organization can therefore also shift their focus on the recruitment and selection process to ensure that it attracts and selects the most qualified applicants. With it will eliminate potential employee performance challenges.

In addition to the above strategies, the organization can also make use of performance support tools to improve the performance of its employees. These strategies include the use of learning aids which offer necessary on the job support, promoting employees from within the organization and putting in place an enabling environment for employees. This will also help to improve the productivity of employees. The use of internal recruitment for senior positions within the organization means that employees will be motivated to keep their productivity high, for them to be considered for promotions when an opportunity will arise. Providing an enabling environment will eliminate possible stressors within the organization which is likely to have an impact on employee’s productivity. It will, therefore, be an effective strategy for improving the performance of employees.

Conclusion

Based on this report it is evident that the elimination of performance reviews will have potential advantages and disadvantages for Accenture. While the use of performance reviews can be an effective strategy to review the performance of employees in order to identify training needs and for decision-making purposes, the outcome is largely dependent on how the process is carried out. If the exercise is not carried out well it can lead to wastage of time and resources while if it is carried out well it can actually lead to improved employee performance. Elimination of performance reviews, therefore, means that the organization will benefit though the potential monetary resources and time that will be saved. It also means that the organization will eliminate the potential benefits that emanate from the use of performance reviews. Alternative strategies that can be used by the organization to improve the performance of their employees include the adoption of training and development programs, giving employees’ decision making authority and encouraging teamwork.  

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