Benefits & Drawbacks of Using Data for Employee Reviews

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It's the 21st century, and many businesses are beginning to use data from management reports in their employee reviews. Here are some of the potential benefits and drawbacks to doing this. 


It Can Feel Less Arbitrary

One great thing about employee metrics is that they give you a framework to talk with your employees that doesn't feel arbitrary. You'll both be able to clearly see the statistics, and if you talk with employees beforehand about what's expected, then you'll both be able to see cut and dry whether your employee is meeting the mark. This can be useful starting point for discussing other issues or successes relating to the metrics. 

Having set, concrete benchmarks can also help your employees to keep track of their own performance in a guided way. Once you are able to go over the data with them, they can become more comfortable with knowing what to expect in reviews. 

It Helps You Quickly Track Performance

Another benefit of using management accounting and reports is that you can quickly keep tabs on an employee by pulling up their latest metrics. You won't need to do a thorough audit of their work simply to do a quick check of your workforce; you can rely on the metrics that mean the most to you. 


It Can Take Work to Set Up

First of all, setting up a good management accounting and reporting system can take a lot of time and effort. You may need to redo your billing or timekeeping policies so that your reports can be made automatically. It may be good to have an accountant go over your accounting system to make necessary tweaks to ensure that your data is accurate and easy to collect. 

You Might Miss the Intangibles

Although employee data can be helpful in many ways, it is also important that you don't miss the intangibles by relying too heavily on the data. For instance, imagine that a team member is slightly underperforming, but the morale that they bring to the office helps other employees on their team be more productive. While this great quality may be missing from their performance metrics, it's still something to take into account during reviews. You can make the most of the data by also following it up with your own qualitative review of their work to get the best of both worlds. 

To learn more about your options, contact resources like Dale K. Cline, CPA PLLC.