InformationWeek
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November 6, 2000 |
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Appraisal Software Ends HR Paper Chase
Human resource professionals welcome online capabilities and automated processes
By Judith N. Mottl
inding, keeping, and tracking employees using updated and accurate performance appraisals is critical to business. Yet at many companies, the process falls through the cracks because it's time-consuming, paper-intensive, and low on the to-do list.To reverse this trend, online performance appraisal software is filling an important niche. Human resource professionals say that by automating the process and adding collaborative, online capabilities, productivity and retention will improve, and employees can take a more active role in advancing their career.
With Web-based appraisal software, employees and supervisors create documents via a browser and route them over the Internet to gather comments and obtain approvals from necessary managers and HR staff. Some software applications guide users, suggesting proper language, offering prompts and alerts about inappropriate statements, and giving a historical perspective of past reviews by archiving documents in a centralized, online location. "Filling out forms, routing, and tracking is a nightmare and managers already have enough to do," says Jenni Lehman, research director for enterprise and supply-chain management at Gartner Group. Putting the process online can help.
When Gentiva Health Services Inc. migrated its paper-based employee performance appraisal process to the Web in 1998, HR led the way, but IT helped in the selection process--particularly in the 500-user pilot program, which included 200 IT staffers. They offered valuable insight in evaluating SuccessFactors.com's PerformanceManager, recalls Diana Rivenburgh, assistant VP of organizational development at the Melville, N.Y., company. "Getting [IT] input made the pilot more challenging. It helped us a great deal in feedback and suggestions on making the software fit our needs," Rivenburgh says.
The $1.5 billion provider of home health care and management has now rolled out PerformanceManager to half its 6,000 employees, including supervisors and managers, and plans to complete implementation by year's end. The application costs from $50,000 to more than $1 million, depending upon the number of employees and scope of services required. It includes appraisal-form templates, a career plan, skills development, and thousands of writing examples to help create those plans.
Gentiva's traditional appraisal process--which included printing, distributing, routing, and tracking forms to and from 1,200 managers at several hundred locations--had become too burdensome, says Rivenburgh. Appraisal quality was diminishing as managers missed completion deadlines and employee involvement was limited, affecting productivity, job satisfaction, and achieving career goals.
While some packages use a document-sharing approach, others offer separate forms for employees and managers. Several packages also provide a so-called 360-degree review program so that employees can request feedback on their job efforts from co-workers, customers, and indirect managers. For privacy reasons, these comments can only be viewed by the employee. However, most software can be customized to reflect a company's existing paper-based appraisal forms and rating systems.
As in Gentiva's case, HR departments usually manage the applications and users' questions, while IT gets involved for technical support. Gentiva's goal in revamping its employee performance management process is efficiency and to encourage year-round employee feedback and management coaching.
The company wanted "to drive individual accountability for [job] performance," Rivenburgh says. Companies may have the best intentions, but appraisals and reviews aren't popular with employees. "It's difficult to play judge on someone's performance. Using a Web-based approach makes sure it gets done," she says. E-mail alerts remind managers of appraisals due or not completed, while also keeping the employee in the loop.
In the past, Rivenburgh says, it was difficult and time-consuming to call or visit a manager to check on the appraisal process. Forms and folders could easily get pushed aside or shoved into a pile of unrelated documents, slowing the process.
Gentiva employees now can receive feedback well before the one-on-one appraisal discussion and effectively focus on goals and objectives. The appraisal is a living document, not one filed away in a drawer, she adds. Just as important, the company expects that the new process will improve its compensation program by making sure appropriate rewards are doled out.
While businesses have steadily automated HR and back-end processes, software for specific employee needs such as appraisals hasn't drawn much attention until recent years. The early versions were PC-based, so the app would have to be loaded onto every employee and manager's PC, as well as notebooks and telecommuters' desktops. The initial software also didn't offer features that improved appraisal quality, but primarily moved the forms into Word documents, where they still needed to be printed for routing and approval.
But today's solutions, from companies such as KnowledgePoint, PerformaWorks, Softscape, and SuccessFactors.com, are quite robust and increasingly popular. Most of these solutions are relatively inexpensive, averaging under $100,000 for midsize companies, especially when they're supported by application service providers. Return on investment usually comes within a year, and there are often tremendous savings of labor and time from reducing paperwork and tracking worker progress, advocates say. So far, none of the leading ERP players have offered dedicated products, though a few are starting to add performance appraisal add-on modules to their packages.
Equiva Services LLC, a Houston joint venture that provides business services, including HR and IT services for Saudi Aramco, Shell, and Texaco, put several tech leaders on its employee panel when it investigated HR software early last year. The IT department played a strong role in choosing Softscape's AchievementPlus that May, says Monte King, Equiva's HR director. AchievementPlus is available on a per-license basis, through ASPs, or as a per-seat license, with prices starting at $30,000 per module.
A hosted system was best for Equiva because its tech division didn't want to customize the software, says CIO Paul Cuneo. To use the application--which is hosted on Softscape's server--employees log on to the Softscape site using a personal password and access appraisal documents, a library of forms, and application support files. "We had no big desire to own it since we hadn't developed the application and had no real support capability," Cuneo explains. In-house management would have also required IT training for support and development needs. Moreover, Equiva wouldn't have rolled out the app as quickly if it were done in-house.
Equiva had two goals in revamping its appraisal process: enhanced employee performance and development capabilities, and a 360-degree feedback program. However, conducting this program on paper would have quadrupled the paperwork, says King, and extended the time required to have appraisals completed.
In the rollout last October, 85% of Equiva's 1,700 employees solicited for 360-degree feedback participated--a much greater response than a paper-based process would have provided, Cuneo says. A total of 18,000 forms were processed over the Internet and Cuneo attributes the high response to the Web's ease-of-use and reminder alerts. "That's about 10 [replies] per person, which is a lot of involvement. We want to help people measure and improve their performance,'' says King. Since about 9% of the company's 8,500 employees are remote, the collaborative, Web-based application also improves communications and participation, King adds.
Among the half-dozen appraisal and performance packages available, all offer efficient routing methods for program compliance and a central hub for forms and employee review folders. Several also provide reporting capabilities, integration into back-end compensation systems, and in-depth content support.
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Illustration by Bob Daly
Photo of Rivenburgh by Naoto Ikeda
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