We are currently reviewing our performance management process, we notice that many companies are moving away from Ratings. I would be interested to understand in companies that have done this what the reaction has been and how or do you differentiate pay for your high performers.
Also, are any companies who have removed them looking to reintroduce?
Thanks
Vicky
Hi Vicky...a related question is "does merit pay awards work?" Generally, no. By all means like performance to variable pay, recognition or even promotion/progression. But pay should be about what the value is of the role (via JE & Benchmarking), and the value of the person (including performance but also potential and retention etc).
We don't use ratings at the moment and weighing up the pros and cons of starting to use them as we have now implemented Workday which supports this. Our Canadian colleagues already use ratings. For us as a medium sized business it is a difficult area to assess and I agree with you that anecdotally it seems that some companies are moving away from ratings...
We're looking at something similar and other options, including fewer ratings to choose from. However not convinced such options for no ratings or fewer ratings will work as surely still need some process to determine bonus or pay awards and may need separate PM and reward process which seems counter intuitive. Personally favour more ratings to allow more differentiation...