Evaluating employee performance is never easy. The tired old methods - holding an annual performance review, grading employees on a scale of 0-5 and basing pay increases only on a standard employee scorecard used for every role - are no longer effective. Instead, experts say social media, ongoing employee feedback, apps for evaluating performance for various IT roles and much more holistic efforts help go beyond basic meritocracy.
"A number of high-profile firms are doing away with forced ranking," says Lisa Rowan, an IDC analyst, referring to the practice that requires firms to identify a set percentage of employees who rank as high, medium and needs improvement. "There is some movement away from having a static once-per-year process towards more meaningful ongoing feedback."
Several emerging techniques and performance-related apps help make evaluation less about the yearly score and more about motivation and improving performance. Here are six that experts suggest.
1. Agile Performance Management Through Frequent Discussions
Going beyond a simple meritocracy of annual reviews and compensating employees directly as it relates to their scorecard is being replaced by something more agile - specifically, the use of agile performance management.
Management expert Josh Bersin, the principal and founder of Bersin by Deloitte, explains that companies are moving to more constant feedback through weekly and quarterly discussions with an employee about performance. "[These discussions] are about what a person can do to improve, what they're doing well, and recognizing when people are doing a good job."
2. Emerging Apps for Employee Performance Evaluation
IT can lead the charge when it comes to using new evaluation apps. Some of the best tools to track ongoing performance include Work.com and Peoplefluent.com. Like a dashboard tool used to monitor a website, these tools use a subjective and ongoing tracking methodology.
One such tool, Kapta, uses agile management in a real-time scorecard app. Says Kapta CEO Alex Raymond: "Smart companies are turning from annual performance management exercises to an ongoing process of setting objectives, aligning work and providing feedback. It's no longer enough to just be a HR-driven practice. Instead, this is a leadership imperative and a core part of the management system of the entire company."
3. Gamification as Performance Incentive
Rowan says there's a way IT can use gamification to track employee performance. This might involve incentives such as tokens at the company store or gift cards that encourage employees to post their successes and tasks completed. Bersin says large companies need to think about more than compensation packages and offer other rewards for good performance. Of course, this ties right into employee retention as a secondary benefit.
4. 360-degree Feedback for Less Subjective Judgment
Most large organizations already use 360-degree feedback, a process of getting input from those who work with an employee as well as directly from the employee, yet many companies make this step secondary to the main performance review.
"Making subjective judgments based on one person's perception or opinion is fraught with bias," says Angelo Kinicki, professor at the W.P. Carey School of Business at Arizona State University. He suggests getting wider input, adding, "The use of 360-degree feedback is a good way to accomplish this part of an employee's evaluation."
5. Real-Time Performance Tracking
What if you could track employee performance in a more constant fashion? That's the idea behind tools such as WorkIQ, which tracks call center performance, tech support and other transaction-based roles. Meanwhile, the Salesforce.com add-on Cloudapps uses gamification to track sales performance.
"Immediate performance feedback lets supervisors and line managers course-correct on the spot, rather than after the damage is done," Rowan says.
6. Social Media as Evaluation Aid
It's easy to forget how social media can play a role in evaluating employee progress as well. One strength of tools such as SuccessFactors (from SAP) is the capability to track how employees collaborate and solve problems.
Rowan says social media is a great way to monitor and track the employee "wins" for an organization. However, Twitter and Facebook aren't as useful for tracking performance problems, as failures are rarely posted in public.
"While social media is all great in theory, it's my opinion that traditional appraisals won't go away altogether soon," she says. "Instead, new means will augment but not replace."
John Brandon is a former IT manager at a Fortune 100 company who now writes about technology. He has written more than 2,500 articles in the past 10 years. You can follow him on Twitter @jmbrandonbb. Follow everything from CIO.com on Twitter @CIOonline, Facebook, Google + and LinkedIn.
Read more about performance review in CIO's Performance Review Drilldown.