When employees face a performance evaluation, they either increase their productivity or decrease their productivity level. Effectively managing employee performance helps in increasing the level of business operations. Fulfillment of organizational objectives takes place when employees have an improved level of productivity.
Today, companies struggle for sustainability and gain a competitive advantage through powerful strategic planning and professional human resources. In the 21st century, human resource is the significant strength of corporate more towards designing productive systems and strategies.
Performance evaluation systems are the systems for assessing the performance of employees working in the organization. Therefore, analyzing the relationship between performance evaluation systems and the employees’ productivity is essential for maintaining employee performance.
In a complex workplace where employee satisfaction and motivation become difficult, managers are concerned with fulfilling business optimization outcomes. However, empirical studies have proven that employee performance is impacted by the level of performance evaluation systems present in the organization.
The process of performance evaluation is critical because it shapes the level of employee motivation and productivity. The performance evaluation process is completed with the help of the two-way communication process between the employee and the supervisor. If the performance evaluation system is not effective, it can decrease employee performance and productivity.
Only those organizations will be successful in the 21st century and will focus on integrating HR strategies associated with the corporate’s systems and processes. For example, the process of the performance evaluation system and the connection between business optimization outcomes design the level of employee motivation and productivity.
Practical studies suggest that effective performance evaluation systems are healthy for the growth of employees. Equity theory states that employees measure their inputs versus the outcomes (intrinsic and extrinsic rewards) they receive. If a performance evaluation system is not developed on an equal basis, employees can decrease their productivity levels. Therefore, evaluation is a serious component in the appraisal system of employees.
If a performance evaluation system is effective, it will motivate individuals to be more productive and fruitful. Therefore, the performance evaluation system needs to be effective and transparent to act as a tool for motivating and developing business optimized outcomes.
The topic of performance evaluation explores the link between performance evaluation systems and employee performance. Employees of the service sector were used for the research study. Results of the study explored that performance evaluation systems in hierarchical structures provided limited results.
Managers of these companies are not willing to take two-way feedback from their employees. However, in flat organizational structures, performance evaluation systems are effective. Therefore, 360-degree feedback systems are adopted by these companies taking two-way feedback from their employees.
The current study aims to examine the effects of effective performance evaluation techniques on employee performance and productivity in companies to optimize business outcomes.
The scope of the present article is to provide the companies with insight related to improving their performance evaluation systems to reward and motivate their employees, which in turn results in optimizing the company’s business outcomes. Empirical studies conducted on the same topic have examined a positive relationship between performance evaluation systems and performance optimization of employees.
Employees look at the methods of performance appraisal adopted by the company. When respondents were asked about the effectiveness of performance appraisal systems in their company, most employees stated that they are satisfied with the systems.
The link between the performance of the employees and the overall fulfillment of organizational objectives was explored. Employee productivity and motivation can be shaped with the help of performance appraisal systems.
Employee productivity is linked with the level of motivation and satisfaction. Factors for increasing the level of employee motivation are job security and leadership adopted by the managers. Performance is linked to the level of the environment in which they are working.
It is stated that performance evaluation is one measure for analyzing the level of employee productivity, but it is not the only measure for analyzing the performance outcomes.
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