Mumbai: With work habitats turning more and more complex, most companies in India are reworking their performance management mechanism so as to attract, retain and reward the right talent, says a survey.
According to the PwC survey, some 52 per cent of the respondents have made or are planning to make changes in their staff appraisal systems in the near future as a burgeoning young workforce, technological advances, a multi-generational workforce and a growing economy have given rise to additional challenges.
Furthermore, it said close to 20 per cent have done away with individual ratings.
The intent to make systemic changes indicates that bold approaches to performance evaluation and management will be seen in the near future, the findings showed.
This study draws its findings and analysis primarily from the Performance Management Trends Survey, conducted by PwC India in 2015.
"We are at the point of inflection that requires organisations to not just cut cost, but transform the way performance is driven and measured. Current systems are focused on shareholders. However, in today's scenario, employees are key stakeholders of the business," PwC India Leader - People and Organisation, Padmaja Alaganandan said.
"Creating new performance indicators, measuring employees on relevant metrics and motivating critical talent will be a vital enabler for corporate success in future."
However, only 12 per cent of the respondents believed that their current performance management system is highly effective in achieving its stated purpose.
There's a feeling that while there is considerable use of performance systems in recognition of individual contribution, they are not as frequently utilised in the recognition of team contribution.
"With collaboration being the cornerstone of workplaces today, it is worth exploring why organisations are not reflecting this reality by giving due weightage to team contribution in performance evaluation," it suggested.
As many as 93 per cent respondents indicated that supporting business objectives remains the primary purpose of the entire exercise.
There was a view that little or no focus on employee outcome such as promoting team work and driving organisational culture can be a key contributor to employee dissatisfaction and their perceived mismatch of expectations.