“Employees would like companies to invest in their development process”

Lavleen Raheja, CEO & Managing Director, FranklinCovey India & South Asia discusses how organisations should handle appraisals 

What do employees generally expect from appraisals? How do you see the expectations changing in times ahead?
Employees usually expect increase in salary/position and responsibility. In the days to come I see certain employees expecting part of the profit share , some would look at value add to their roles , some would want companies investing in their future development holistically  like nomination for executive learning programs , PG courses etc a best institutes and universities. I also see variable very high performance based pay structure being agreed and expected too.
Are appraisals only about salary? What other benefits/perks help win over employee confidence?
No, appraisals are not only about salaries. Share in profits , share in ownership , long term loyalty bonuses , value additions on health , education of self and family, spiritual alignment are the other important factors which can help the organisations win over employee confidence.
Employees generally move out after pay hikes, what retention strategies do you put into place to control it?
We offer loyalty bonuses for 5 year stay to our employees. We also let them interview us when being hired so that their decision is well thought out, rather than just another decision. The spouses are also involved in joining decision, sometimes. We also roll out rewards, payouts throughout the year and surprise them with small but relevant perks.
What actually goes into building a sustainable and effective compensation strategy during appraisals?
An effective compensation strategy should align to the growth strategy of the company. Performance should be the key driver of compensation and luxuries of life should come through rewards for all. Salaries should be nice to keep the engine running easily but should not make the employees so comfortable that they become lazy and loose ambitions and growth paradigms. A range of 5 to 15% is a good range today but with performance regards for all. Salaries should build a performance culture rather than a complacency culture.
Which mechanism works best in dealing with post appraisal dissatisfaction?
The Candidate should not do the following things when his appraisal doesn’t meet his expectations:

• A candidate should not become reactive
• A candidate should not become aggressive
• A candidate should not feel depressed or elated
• A candidate should not blame the person or the system who appraised him
• A candidate should not form any biases or opinions either about the system or the person who appraised him / her

The candidate should do following things in a case where his appraisal don’t meet his expectations:

• A candidate should remain composed and be proactive in behavior
• A candidate should read the appraisal with a calm mind and try and understand the actions suggested carefully and evaluate and analyse them
• A candidate must seek time with his/ her appraiser and put forward the points on which clarifications are required
• The candidate must politely but assertively disagree on any such points / issues and present data and facts on these points of disagreement.
• If the candidate agrees to the points clarified, corrective actions and measures to be taken as suggested

In case the points are not agreed upon by candidate and the appraiser, then the candidate can seek independent opinions from senior colleagues with prior permission from the appraiser.
If the independent senior colleagues also think that the things mentioned in the appraisal are actually the areas of improvement for candidate, the candidate can work on the said issues for next quarter with the help of the appraising senior and seek all his / her support for development.
What is the average (percentage) appraisal you have offered this year?
We have offered 10% hike in salary and we have added something new called a fixed variable which is part of the performance incentives for all departments in our company.