Glossary of terms used in Employee Performance Management process

Performance Management best practices demand a clear definition of terms used in Performance Review, Feedback, Compensation process. Here is a Glossary of terms in the world of Performance Management.

Employee Setup:

Band	Employee hierarchy in the organization
Compensation	Pay structure i.e. Heads under which salary is paid
Designation	Job profiles of employees as per bands & departments
Employee Status	Specifies the timeline for the review with a start & end date. Employee status in the organization. Example: Active \| Terminated Sabbatical \| Resign

Performance Measures:

360 Degree Feedback	Feedback process where an employee receives feedback from External & Internal stakeholders
External Stakeholders	Feedback process where an employee receives feedback from External & Internal stakeholders
Feedback Templates	Set of questions to seek feedback on a specific aspect of employee
Goals	Work objectives as per job role.
Instant Feedback	Real-time Feedback to & from anyone. Ability to tag the feedback to Performance Measures
KRA	Key Result Area. Outlines the task that employee has to perform & what is expected.
KPI	Key Performance Indicator. A measurable value related to the Key result area for the employee.
Measurable KRAs	Performance Measures against which targets can be set and performance tracked against actual achievements.
Performance Review Category	Broad categories under which employee performance is reviewed i.e. KRAs, Competencies, Values etc
Performance Measure	An employee performance parameter that can be evaluated either through subjective or measurable rating.
Review Templates	Set of performance measures grouped to evaluate specific job role or function.
Rating Scales	Used to rate performance measure of an employee.
Review Letter Templates	Post review letter templates to be issued to employees based on Performance, Salary Increment and promotion for employees
Subjective	A Performance Measure that requires a qualitative assessment by the Reviewer to be rated with the help of a Rating scale.

Administration:

Roles

Helps to assign system access (Create, Modify, View) rights to users

Review Process Setup:

Coverage	Employee set to be reviewed; can be chosen by departments/bands too.
Frequency	Defines the number of times the employee evaluation will be conducted during the period. For example Bi-Monthly, Quarterly, Half-Yearly or Annually
Min. Service Period	Minimum number of months employees should serve in the organization to be eligible for the performance review process
Period	Specifies the timeline for the review with a start & end date.
Remainder Alerts	Allows auto-reminders to be triggered to employees based on pending Performance review tasks

Review Form Configuration:

Acceptance	A formal review process activity when the employee gets to have a look at the final review inputs of the Manager and formally accepts & sign-offs.
Employee Development Plan	A Review Form section that allows for recording of Employee Development and training needs.
Employee Review Form Sections	Parts of the review form for recording different aspects of employee’s performance.
Goal Settings	A formal review process activity where the Performance Measures/KRAs are set for each employee & signed off. Goal setting can be done by employee & reviewer collaboratively or by the Manager or HR alone.
Highlights	A Review Form section that allows specific open-ended aspects of employee’s performance to be recorded i.e. Strengths & Weaknesses, Achievements etc.
Performance Metrics	A Review Form section that allows for a rating of Performance Measures & KRAs based on the KPIs.
Moderation	A formal review process activity where a senior employee reviews the inputs by employee & manager for fairness and thus assures that the process was conducted appropriately & consistently.
Moderator	A senior employee that conducts the Moderation process in a Performance Review, ensuring that the reviews were conducted properly.
Process Flow	The process workflow for the Performance Review i.e. Whether Goal setting will be done, whether employees can do self-evaluation, whether there will be an acceptance process etc.
Reviewee	An employee who undergoes review
Reviewer	An employee who reviews the performance of a Reviewee
Set Reviewers	A Review process activity that confirms the Reviewers who will be reviewing the employees for the review.
Transfer & Promotion	A Review process activity that allows Managers to recommend employees for transfer & promotion and record reasons in the Review Form.

Performance Measures Setup:

Department	Performance Measures that are set to evaluate departmental performance & thus indirectly an employee’s contribution to the same
Individual	Performance Measures that are set to evaluate individual employee’s performance.
Organization	Performance Measures that are set to evaluate organizational performance & thus indirectly an employee’s contribution to the same.

Grade & Score:

Grade Frequency	Allows for gradation of employees based on performance. For multi-frequency reviews like Quarterly, Half Yearly, etc grading can be chosen to be set for any of the legs of the review.
Scoring Basis	The basis for calculating performance scores of employees based on final ratings of performance measures.
Weightage	The weightage for different categories of performance measures used for employee evaluation. This helps to calculate one overall final review score for the employee.

Plan and Schedule:

Set Assessment date	Set the start and end date for the review process that may include self-evaluation, Manager’s performance appraisal, and Moderation.
Set Performance Measures date	Set the start and end date for the setting of Performance Measures if either Reviewee or Reviewer are involved in the process.

Review Process:

Absolute Grading	A Grading method based on an absolute range of scores. i.e. 80-100% is Grade A, 60-80% is Grade B, etc.
Grading	A review process activity where employees are graded based on overall performance review scores.
Normalize Ratings	A review process activity where employee performance scores as submitted by Reviewers are readjusted based on various organizational factors to set the final review scores for employees.
Professional Development	A Review process activity where development recommendations along with Plan, timeline and linked to performance measures are recorded.
Relative Grading	A Grading method based on percentile review scores of employee’s performance.
Self Review	Self-evaluation process by an employee.

Compensation:

Budgeting	Setting the compensation budget for the next period. Budgeting can be done at an organizational level or a department & band level.
Increment	A process of compensation planning where employees are given a fixed or performance linked pay raise.
Salary Correction	Any adjustments to employee’s correction, outside the scope of the increment process.
Salary Finalization	Any adjustments to employee’s correction, outside the scope of the increment process.

Review Close:

Analytics Employee Wise	Top & Bottom 5/10/15/n employees in a performance review.
Analytics Goal Wise	Average % score on each performance measure department wise. Top & Bottom 5 measures to identify, strength & weaknesses.
Analytics Grade Distribution	Percentage of Employees in each Grade Bucket. Department wise Grade distribution of employees.
Analytics Score Distribution	Average Review Score department wise in a performance review. The variation (standard deviation) in a spread of review scores
Review Letters	Post Review formal Letters issued to employees with details of Performance Review Grades, Increments, transfer, and promotion
Reports	Detailed Analysis of Employee Score Distribution, Grade Distribution, Employee Review Comments, Employee Ratings, Development Sheet, and Performance Score related to a Performance Review.

Feel free to use this in your Employee Performance Review and Feedback. If you have any suggestions, or additions to make, feel free to connect, will be happy to update the list.

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Performance Management Process: Glossary Terms