For every manager that speaks about the importance of transparency in performance appraisals, there is another who speaks about the importance of confidentiality. Proponents of confidential performance appraisals argue that employees do not need to know everything and that a lot of transparency can hinder growth and employee performance.
Elena Belogolovsky, an assistant professor in the Department of Human Resource Studies at Cornell University's ILR School suggested that lack of transparency can have both positive and negative effects. She concluded that pay secrecy eliminates jealousy among employees and boosts performance.
However, many academicians also note that pay secrecy and lack of transparency with respect to performance appraisals can lead to a general sense of mistrust among employees, which is always counterproductive. Though lack of transparency may have its benefits, in the long term, transparency and honesty will keep an organization and its employees together.
What must HR departments do to enhance transparency?
HR departments can make use of specific software programs to enhance transparency and make information readily available. Though making performance appraisal may reduce secrecy and make vital information easily available, the sense of trust and confidence that it brings to employees is undeniable.
An HRMS, or a human resource management system not only improves transparency during an appraisal but also provides managers and the administration with key functions that help them to control the amount of information that is let out. Let us take a look at the 4 ways an HRMS helps to increase transparency in appraisal systems:
- Track performance
Without a doubt, an HRMS helps managers to track performance and understand who needs to be rewarded more and who must be rewarded less. An HRMS tool provides valuable analytics that can be used to continually assess employees. With respect to making performance appraisals more transparent, HR managers can make select information accessible to employees. This ensures that employees are not kept in the dark about the parameters that lead to successful appraisals. This information can be accessed by employees whenever they want, or on request.
- Accessibility of information
Whether we are talking about HR managers or employees, everyone has a right to access relevant information. By customizing HRMS tools, we can make sure that certain parts of information which are not sensitive can be made available for whoever needs it. Prior permission may be necessary and sometimes, that may not be necessary. This helps to build trust and confidence with managers, who are often at the receiving and when it comes to answering questions related to performance appraisals.
- Verifiability of appraisals
HR managers are answerable to their superiors too. Whether it is deliberate or it is due to human errors, mistakes can happen. The wrong employee could receive an unintended appraisal. When employees escalate issues, HRMS serves as a tool to verify any inconsistencies that can crop up during appraisals. Senior management, middle management and employees can all access crucial data depending on their level of function, in order to make sure that appraisals are verifiable.
- No room for subjectivity
HRMS tools are software programs. They cannot be subjective about who is going to get a better appraisal and who will not. This objectivity is very important to make sure employees and mangers do not have difference of opinions. By removing subjectivity as much as possible, an HRMS ensures that performance appraisal systems are objective in nature.
Custom HRMS solutions bridge the gap
All said and done, it is very important to archive even the most unimportant employee-related data. There are several legal considerations to note and only a powerful HRMS tool can make sure that data is archived in the cloud, to be retrieved when required.
A powerful and customized HRMS can help organizations to not only heighten transparent communication during performance appraisals, but also maintain confidentiality where it is really required. Most importantly, everything is recorded and is available to retrieve and verify.