In recent years, organizations have been observed to be making use of tough-minded approach of ranking associates against each other. This approach is known as forced ranking performance appraisal method. It can be argued that this approach is dictated to force managers to make the performance evaluation process truly reflect how each team member is performing, relative to others, with the ultimate goal of being more productive employees, who perform at levels to make service, revenue, and growth goals attainable. In my opinion, the system does force managers to have hard conversations with employees that they might otherwise have avoided. As any manager knows, it’s often easier to avoid difficult, painful performance-related conversations than to confront them head on. This method literally forces performance issues to be addressed; for an organization that wants to tighten or formalize its management processes. I believe the forced ranking method can have benefits however, from a hands-on management perspective, there clearly are problems associated with it. Putting it simply, it causes employee morale problems. An issue with forced rankings is that the system results in a heightened focus on individual performance and did very little to promote team building which is always valuable in a corporate environment.
The Equity theory is built-on the belief that employees become de-motivated, both in relation to their job and their employer, if they feel as though their inputs are greater than the outputs. The equity theory centers on overall pay as the outcome. Employees can be expected to respond to this in different ways, including de-motivation, reduced effort, becoming disgruntled, or, in more extreme cases, perhaps even disruptive. People feel that the ranking method violates employees' rights causing some lawsuits and accusing the employer of discrimination. The employee may just decide to resign from their current job position due to annoyance or perceived inequalities. The equity theory truly shows how losing a promotion and/or raise really affects the employee motivation and commitment to the corporation. Employees want to be treated equally and when they are placed in a group that they do not believe they are a part of, it results in negative reactions. The individual would be resentful to other employees who received a higher score for doing the same input of work ultimately creating a negative environment for not just himself but also for other employees.
I would use the goal setting theory, where a specific target is implemented for the employee. It is a conscious goal that influences motivation to be geared towards a desired outcome. By being specific with the goal and having a plan of action of how to attain that goal, employees and managers can gauge and monitor progress towards that goal. When the employee is involved in the goal setting process, he takes a personal interest in achieving that goal. The emotional involvement becomes a strong motivator and can help the employee reach his goals.
Once the goal is stated, a process can be created that the employee will follow to reach it. With a list of goals and the procedures necessary to reach them, an employee can better focus his efforts on achieving the things that will bring success to his career and his company. Goals that are not properly crafted can become demotivating. If the goal seems too easy or not specific enough, then the employee is not motivated to achieve it. A clearly defined set of goals can be used during an employee evaluation to determine how well the employee performed against those goals, and what changes need to be made to improve reaching goals in the future.