The COVID-19 pandemic has created a negative impact across various industries and sectors. As the global economy is battling the adverse effects of the pandemic, it has coincided with performance appraisals and recession. In this grave situation and prevailing crisis, companies are now restructuring and revaluating their remuneration and appraisal structure.
Companies and businesses all around are making brave business decisions everyday like adopting work-from-home initiatives, bringing together a new HR framework or introducing COVID information. In this crisis situation, the companies are majorly facing a dilemma over how to strike the perfect balance between the employee’s safety and wellbeing, as well as their employee’s efficiency and productivity.
According to the 24th edition of Aon Plc’s annual salary survey, in the year 2020, the average salary hike of Indian employees were expected to be 9.1% which is the lowest in the decade due to the economic slowdown being experienced in 2019. A number of organizations are taking the ‘wait and watch’ route to revaluate the current crisis. Moreover, salary hikes are anticipated to be gradual this year, with a greater effect on incentives rather than fixed pay raises as they represent the financial success of the company.
Sharing their dilemma with regards to financial effect of the pandemic, renowned organizations and companies have confirmed the delay in performance reviews. Additionally, to deal with the situation, few companies have also opted for significant cut in higher management compensation. The vulnerable situation, has led to making tough choices where pay cuts, layoffs and significant trim in marketing activities are being commonly practiced. Thus, employees are going through anxieties and are prone to speculations regarding salary hikes or normalisation of salary structure, which has resulted in weakening of employee morale and confidence to a great extent.
During these unprecedented times, it is very important for talent leaders to manage costs and find ways to pull through this year. Additionally, in this situation the employers should create a committed, connected and empowered workforce by being pragmatic and clear in their decision making and communication process. This is the time when employers need to connect as well as handle employee expectations. This approach will not only help the management understand the salary changes that they intend to introduce in future, but will also help maintaining the employee’s productivity and future attrition under check.
At the moment when companies and organizations are looking for innovative ways to maintain stability in their businesses, they cannot sacrifice their best talents and resources to this pandemic. Hence, during this time rather than delaying the performance review, transparent discussions will help to bring back the focus on potential opportunities and goals for both the employees and the company. These appraisal discussions will help bring down fears and concerns amongst employees and will introduce more clarity and openness as communication in these challenging times is imperative for both the parties. Transparency and honesty go a long way than delayed response and keeping the employees in the dark.
In these difficult times, it is crucial to treat our resources and workforce as priority. Though the management will take tough choices to sail through this crisis – holding on to people will always be the most important factor. As it’s the workforce that can maintain corporate stability, push new initiatives, boost each other’s morale, and collaborate on different business approaches.
Companies can also re-create the goals and KPIs to suit the existing requirements. Being in a crisis situation, not all positions will have the same amount of workload as others. Hence, a re-alignment of duties as well as related KPIs will be necessary as the employees will be able to provide cross-functional assistance. Additionally, the workforce will not be assessed only on their operational responsibilities.
Due to the nationwide lockdown and crisis, it is very important for companies and organizations to re-define their goals and targets which can be achieved with limited manpower or remote working environment. Well defined goals will bring transparency, dedication, and a sense of ownership to the employees in this tough situation. Moreover, it is imperative for managers to be in constant touch with their teams and keep them motivated and updated about tasks and goals for functioning efficiently.
Now is the time that the businesses need to think out of the box as well as be adaptive. It is the need of the hour for companies to re-examine the traditional procedures of performance evaluation and implement new appraisal processes and programs to retain talent as well as scale their business.