Now a days, appraisals are going on in each & every company. If you ask any employee about his/her appraisal, most of them are not happy. Employees think they work whole heartedly throughout the year but why their bosses don’t give them good ratings. Employees always have confusion about what is the basis on which the bosses conduct the appraisal, which factors are considered at the time of appraisal. They wonder that what would have done better so they could get better ratings.
On the other hand, I have seen that many owners or top management complain their employees are not taking ownership of their work though they know their job description, roles & responsibilities. There is a huge gap between expectations of employees from the management and the expectations of management from employees.
The interesting fact is; we all know what our job description is but most of the times we don’t know what results are expected from our work. It mostly happens in those departments who don’t have annual targets.
Let me share one of my experiences, one day I was at a client’s office & was analyzing their financial documents & reports. I curiously asked the accountant that, what his KRA was. He told me his KRA one by one like: Ensuring timely & accurate entry of Accounts payable invoices, Generate reports, Pay all taxes timely, Banking transactions etc. He added, he works as per his KRA/Job description.
The reason to ask him was when I analyzed all their financial reports; I observed huge amount was spent on late payment of taxes, cheque bounce charges etc. Though he worked as per his KRA, the results of his work were horrifying.
When we say KRA, we generally talk about our day-to-day actions/tasks but actually KRA is ‘Key Result Areas’. It means, in the end what result is expected from our day-to-day actions.
What should be KRA & how should be those measured?
Let’s take an example of an accountant. The KRA of the accountant can be:
- There should not be interest paid on late payment of taxes. By default it defines that accountant ensures all taxes are paid on time; arrange funds for quarterly, half yearly or annually payments as per requirements. In case of lack of funds, he should tell to his superior well in advance.
- Recovery rate should be min x% (eg 85%). It automatically covers all tasks related to recovery like he must raise invoices on time, take follow up for recovery. After a lot of follow-up with clients, he is not able to recover the payment it’s his responsibility to escalate the issue to his superior well in time. Also, he must ensure that whether his superior has taken any actions on that issue or not.
- Maintain free cash flow. Only generating monthly reports is not important but he must able to show a clear picture to the top management regarding the status of availability of funds, how much fund is required in coming days, where company is spending more than required, what were the unexpected expenses etc.
At the time of appraisal, it makes easy to appraise that person on his KRAs like what results he produced throughout the year, was there any issues, did he communicate to the superior well in advance etc.
In this way, we can create KRAs for other departments too. These are directly linked to the output of the work. The benefit of this, employees will not only get clarity of their work but also they will understand on which factors their appraisal depend on. This will create transparency in the organization. And, if employee knows what is expected from his work, he can take ownership of his task.
Most of the time, it happens that boss takes an appraisal of the employee on his recent actions, behavior & capabilities. Sometime, he may forget about the good work done by that employee in the past. So in such cases, result oriented KRAs help bosses to view the overall performance of the employee in throughout year.
Apart from KRA, appraisals also include the behavior, soft skills & capabilities of the employees. But if you implement results oriented KRAs, I am sure that your more than half of the work gets over because quantitative data speaks a lot than qualitative data.
Friends, just change the perspective from Routine Tasks to Result Areas, you can see the huge difference.