Skip to main content
HR Resources

Do Performance Appraisals and Employee Benefits Boost Employee Satisfaction?

Human Resources (HR) form one of the most important departments of any company. A small business can thrive in a competitive environment if its HR department can appreciate the employees most professionally. It helps in improving employee satisfaction.

The meaning of Performance Appraisal 

In simple terms, performance appraisal means an unbiased evaluation of the overall performance of the employee and providing him benefits based on the results. The extent of performance appraisal depends on the efficiency that the employee has clocked for the company.

Several ways of evaluation 

There are several ways to measure and evaluate the performance of an employee. The methods depend on the nature and scale of business, and the designation along with the functionalities of the employee. The HR sets the standards for the evaluation and use certified methods to perform the task.

The HR documents the evaluation

The HR department designs the methods to evaluate the employees. They do a comparative analysis of the reports of various employees, and accordingly, extend the benefits to them. The process remains organized under the efficient management of the HR.

Research studies speak in favour of performance appraisals

There have been numerous research studies that speak in favour of performance appraisals, and considered them to be quite effective in boosting employee satisfaction. The appraisal adds more value to the company by letting it know the strengths and weaknesses of its employees*. 

More clarity on achievable goals

The appraisal plays an instrumental role in providing more clarity about the achievable goals of the company. The management of the company gets coherent ideas about the HR strategies to be implemented to re-organize the teams and strive for excellence in a more proactive manner. 

Increasing the accountability of the employee

There is no doubt that the appraisal process has a major significance in increasing the accountability of the employee of your company. He/she receives clearer guidelines about his/her job and the responsibilities he has fulfilled and is expected to continue, in a better way. Also, he becomes aware of the areas where more effort is needed. 

Developing a personal commitment

The HR, through modern appraisal techniques, ensures a stronger personal commitment from the employee. It ultimately helps the company to grow and streamline its operations in the desired manner. An appraisal is also considered to be a strategy to strengthen the bond between the company and the employee.

Identifying the potential in an employee

An appraisal is also a remarkable tool that can correctly identify the potential of an employee. When the potential is tapped optimally, the company can practically benefit in terms of productivity. Such identification of employee potential is one of the objectives of the appraisal system.

Identifying training and development areas

It is extremely crucial to identify the particular training and development areas for the employees and implement the required strategies to improve the prospects of the company. This is one of the agendas of the appraisal policy. If the employee needs to develop certain skills to cover his lack of efficiency, then the company should arrange it.

Locating the discrepancies

One of the important aspects of the appraisal system is efficiently locating the discrepancies between the target employee efficiency and realized efficiency level. The HR and other departments work in tandem to close the gap.

Salary increment is one of the main appraisal strategies 

The HR personnel recommends the management to increase the salary of an employee if his performance complies with the demand of the company. The impact of salary increment is naturally positive on the performance level of the employee, as research data reveals. The employee feels a stronger connection to the company.

There are various ways in which HR can increase the salary. It can be an increment in the basic pay, a boost in the incentives or increasing things such as house rent allowances. Overall, the concerned employee becomes happier.

Providing health insurance

An excellent way to appreciate the employee via appraisal is by providing him health insurance. The company can implement a group health insurance policy for a team of employees. The insurance covers the costs of medical consultations, hospitalizations, medicines, etc, of any employee from the insured group.

It creates more confidence in your employees and they become more willing to invest their effort and time to move your company forward. The security boots their level of job satisfaction. They admire the management. It helps the company to accelerate its growth, even in a highly competitive environment. 

Providing lifestyle benefits 

The appraisal can also include providing a series of lifestyle benefits (such as health club discounts, food coupons, etc), based on the performance of the employees in a quarter or month. The employee feels more respected by the management and delivers what is required of him. He feels the accountability that the company expects from him.

Integrating a consistent feedback system 

It is the priority of the company and its HR department to efficiently implement a robust feedback system within the business framework to gauge and work on the performance of the employees, from a better technical perspective.

What happens when there is more employee satisfaction?

If employee satisfaction is boosted, the company can remain confident about increasing its pace of growth. There will be a sustainable in-flow of revenues. The goodwill of the company in the industry is also going to increase. There is a far better coordination between the management of the company and the employees.

Evolving the appraisal strategies 

It should be one of the major priorities of the company to continuously evolve its appraisal strategies to keep on boosting the level of employee satisfaction. A good team of employees is a valuable asset for the company. It creates more value for its business and strengthens its prospects.



Leave a Reply