How Technology Will Change Employee Performance Evaluations

Traditionally, employee performance has been evaluated via a reliance on two dichotomous vectors: qualitatively and quantitatively. The advent and widespread application of rapid advances in technology will fundamentally shift the contrasted relationship of these two evaluation methods, resulting in a stronger emphasis being placed on qualitative data. For context, we will first create a juxtaposition of the two analysis methods. Then we will explore exactly how technology will shift the qualitative vs quantitative dichotomy. Finally, I will propose a modification to the performance appraisal system.

~ Qualitative vs Quantitative Analysis ~

According to the conclusion of a comprehensive analysis conducted by Shah & Corley (2006), there is more benefit to utilizing both methods, than there is from utilizing only one. There are benefits and drawbacks to each, some employees are stronger in one area than they are in another, and some managers are naturally biased to favor one over the other. Consequently, utilizing a blend of each method results in a more well-rounded employee profile, equips managers with a wider range of analysis data points, and mitigates evaluator bias.

Qualitative Analysis

Analyzing employee performance from a qualitative perspective allows managers to capture intangible elements of an employee’s work, typically centered on the value of the employee’s presence. This method covers more ambiguous elements of performance, ranging from coordinating extracurricular events like birthday parties, feedback received from satisfied customers, and simply being a positive influence on workplace morale.

According to the peer-reviewed journal entry on employee happiness by De Clercq, et al. (2019), employees who exhibit positive energy, based on a sense of job satisfaction, are more likely to go out of their way to perform better and help others.

While employee happiness is largely rooted in the practices of that employee’s management team, there are also many organic elements based on employee personality and upbringing. As a result, some employees are naturally predisposed to exhibit positive energy within their workspace, while some others are not. However, managers are not awarding higher marks to employees based on something entirely outside of that employee’s control, as would be the case for something like the employee’s height or eye color.

Being a positive influence in a team is as much a learnable skill as being organized or efficient with one’s time. Therefore, whether or not an employee is aware of, improving upon, or practicing this attribute, holds just as much weight within the qualitative analysis method as customer satisfaction surveys do.

Although the qualitative analysis method is very helpful in evaluating the value of an employee’s work, it can be very dangerous to rely solely upon this one method; especially depending on the line of work an employee is engaged in. For example, if an employee is a first responder on an Emergency Medical Team, and they are a generally kind person who enriches the lives of those around them, but they never save any lives, then that person should certainly be terminated immediately and turned to a new line of work. This example goes to show that sometimes the results of an employee’s performance can be just as, or in some cases more, important than the value of their work. Because results are important too, there is another analysis method which is based on results: the quantitative analysis method.

Quantitative Analysis

Usually based on raw data, the quantitative analysis method solely focuses on the employee’s performance metrics. This allows managers to ground their analysis in hard facts and figures, which prevents speculation about bias, and creates a more transparent evaluation method for employees to align with. Further, many agencies and managers tend to slant more towards a results-oriented approach to business, which naturally favors performers who secure results.

The quantitative analysis method typically works well for individuals who are punctual, hard-working, and organized. These are the same attributes which are ordinarily respected by managers when evaluating employee performance, as they are seen as necessary for creating results. Under the auspices of the quantitative analysis method, businesses are established to generate wealth, wealth is created by business models which are executed well, and employees who perform well are valued by the organization.

As is the case with the qualitative analysis method, there can be dangers in solely relying on the quantitative analysis method, as well. For example, if a company favors and emphasizes performance, while ignoring qualitative aspects like employee satisfaction and morale within the workplace, then that business will likely see a high degree of turnover due to employees quitting or unionizing. This is a very real problem in highly competitive companies, as reported by Business Insider, via testimonials from former employees of Tesla, Matousek (2020).

Synopsis

A hybrid of both systems is the best method for evaluating employee performance for three discussed reasons: there are merits to both the qualitative and quantitative analysis methods, for the value derived from forming a more complete employee profile, and in an effort to mitigate evaluator bias. Further, businesses are able to shift the focus from being more heavily oriented on one analysis method, based on the corporate climate, business values, and type of work being done. However, advances in technology will fundamentally shift the model to emphasize qualitative virtues in the workforce of tomorrow.

~ Impacts of Technology ~

Technology is changing many aspects of today’s workforce. According to a peer-reviewed journal entry by a coupling of NYU Stern School of Business and Harvard Kennedy School students, the advent and widespread distribution of Artificial Intelligence (AI) could create “labor market upheaval,” Furman & Seamans (2019). This upheaval is believed to be brought about due to many labor-intensive jobs being replaced by AI systems, which complete tasks more quickly and accurately, without the cognitive taxation which humans endure from concentrating on a task for a long period of time.

More recently observed, an environmental research letter submitted to Institute of Physics (IOP) Science certifies that 26 out of 39 surveys found that energy use declined during COVID due to teleworking, Hook et al. (2020). Because many businesses adopted Zoom meetings and teleworking practices to adhere to social distancing mandates, these technologies have opened up an avenue of possibility for businesses to continue to contribute to energy consumption mitigation efforts, while accommodating the desires of their employees.

Artificial Intelligence

Although it seems likely that the method of employee evaluation would shift into the realm of quantitative analysis, evidence indicates that the shift will actually be more into the realm of qualitative analysis. Employees will rely on their computational skills and be involved in the actual business execution process less, as AI becomes more sophisticated and capable of completing complex tasks.

A helpful comparison is that, at one time, a person who was able to execute complicated algebraic computations was highly valued by their organization; because they were able to deliver a skill that their coworkers could not. However, as calculators became more and more complex, as well as more accessible, the value derived from the ability to perform algebraic computations became obsolete, since anybody could do them within a matter of seconds. Likewise, the value of a worker being able to complete a large number of complex tasks in an efficient manner will similarly become obsolete, as AI will deliver these results for every employer within a matter of seconds.

Because AI will greatly minimize the value of an employee’s ability to stay organized and complete a large number of complex tasks, managers will analyze these virtues less over time; instead focusing on the value that the employee’s presence has on the team. The value of an employee’s presence is highly ambiguous and difficult to capture in a quantitative format, so this will be an element of the qualitative analysis method within the employee’s performance review.

Teleworking and Virtual Work

Notwithstanding environmental benefits, there is also a cultural shift into the world of virtually-based business afoot in today’s market. Virtual video games, the Metaverse, high school students attending classes on sick days via virtual learning, and even the online module through which this very blog will be submitted- these all attest to the rapid shift in importance and utility of the virtual world.

According to Lidia Oliveira, PhD (2019), media consumption was projected to reach 492 minutes per day in 2020, which is equivalent to more than 8 hours per day that the average person was projected to spend immersed in the virtual world. In a vacuum, this figure sounds shocking, but it does not raise much alarm when considering the amount of time people spend scrolling on their phone at every possible moment throughout their day.

Because a vast majority of the labor force is spending copious amounts of time immersed in the virtual world on their devices, many businesses have harnessed this shift in behavior and begun to offer virtual work-from-home options to employees. According to a prediction by Apollo Technical Engineered Talent Solutions (2022), 22% of Americans will be working remotely by 2025. They note that this is an 87% increase from pre-pandemic levels, and the article goes on to say that employees working from home reported being happy 22% more than their counterparts who preferred to work in an office environment.

The problem with working from home or in a virtual environment is that employee cross-engagement can be significantly diminished when employees are not in the same physical environment. Diminished employee engagement can lead to estrangement, or a minimized sense of value to the team. As a result, this shift in work environment will rely more than ever on those employees who demonstrate the qualitative virtues of enriching team cohesion through their influence.

Although the responsibility to foster team cohesion will fall more principally on the manager or team leader, employees who exhibit the capacity to execute this responsibility in the early stages of their career will signal their value to the company via the impact they have on the team. An employee’s impact on team cohesion falls more predominantly within the realm of the qualitative analysis method.

Qualitative Shift

AI will diminish the value of an employee’s ability to do tasks well, because AI will do most tasks for employees- at least, certainly, the important tasks. Further, a shift to virtually-based work environments will drive up the value of an employee’s presence and influence within their work environment. Both of these effects point to a shift in importance from quantitative analysis to qualitative analysis. Employees who positively impact their coworkers will deliver more value to companies in the workforce of tomorrow than employees who are efficient with their time.

~ A New Appraisal System ~

To account for shifting priorities in employee engagement, wrought about largely by advances in technology, an employee performance appraisal system must be written which evaluates performance with as stronger emphasis on qualitative virtues. Naturally, this template cannot be applied in every industry, as some preserve a strong reliance on quantitative performance. Further, this template retains elements of both qualitative and quantitative analysis, as a hybrid system delivers tremendously more value than either one can, alone.

Evaluated Virtues

An employee should be evaluated based on a blend of interpersonal skills, such as communication, conflict resolution, teamwork, and responsibility. Really, these interpersonal skills are a demonstration of an employee’s emotional intelligence (EQ), which is considered more important and valuable than analytical intelligence (IQ) in some ways, Goleman (2020). In addition to emotional intelligence, staying true to the hybrid method, a person should also be evaluated based on the results of their work performance.

According to author of Emotional Intelligence, Rajagopalan Purushothaman (2021), human emotions can be destructive if they are not managed well. Team cohesion and workplace morale can be considered the sine qua non of many organizations, especially startups. Consequently, an emphasis must be placed on the benefactor of these qualifiers: EQ.

As is the case for IQ, tests which analyze a person’s EQ can be manipulated in order to yield inaccurate results. Further, of infinitely greater value than a person’s capacity for intelligence, is their actual application of intelligence. Therefore, observable attributes which spawn from EQ, such as communication, teamwork, responsibility, and conflict resolution (if applicable), should be the basis for evaluating EQ.

However, because some employees come from a more privileged background than others, and thus may have an advantage in understanding and practicing EQ, employers are equally responsible to train their employees in identifying and developing EQ throughout their career. An employee’s ability to adapt to, and apply, EQ concepts can be just as much a part of the evaluation process as their work performance.

Secondarily in a growing number of cases, but still an item of consideration, is an employee’s quantitative work performance. With the advent and application of AI systems, the data available for employers to draw conclusions about employee performance will only be enhanced. As a result, the precision of analysis reports will cause the quantitative portion of employee performance reviews to become even less likely to be disputed by employees.

Interestingly, and except for in some cases, an employee’s punctuality is of growingly antiquated importance to many supervisors. In the case of shift work, punctuality is extremely important because one employee relieves another. If the employee being relieved does not clock out when they are supposed to, it can lead to Human Resources complaints and overtime pay. Additionally, in the event that an employee is opening up a store or service for the day, it is important for the employee to deliver the promised start time to the customer base.

However, in nearly all other instances, an employee’s hard start time is negligible to their, and the company’s, overall success. As a result, fewer supervisors are placing such a sacred value on punctuality, in comparison to workforce supervisors of the past. Consequently, timeliness is not an employee attribute which should be evaluated- except for in the case of shift work, if they are the employee opening up for the day, or if their punctuality begins to interfere with their work performance.

Better Appraisal

Analyzing employee performance based primarily on EQ attributes, then secondarily on performance metrics, will lay the groundwork for driving stronger cohesion into the ranks of the team, while taking a forward-leaning approach to embracing the changes that will come with shifting employee roles in tomorrow’s technology-driven workforce.

A hybrid approach, analyzing both qualitative and quantitative performance metrics, will deliver a more well-rounded employee profile, alleviate employers of some perceived bias, and enable employers to utilize a larger pool of performance analysis data points.

Intended Outcomes

By analyzing an employee based on their interpersonal skills, any person is granted an equal opportunity to perform highly within an organization. Employees exhibiting attributes like kindness, team work, and communication will contribute to a more cohesive team, which will spur escalated levels of employee happiness and job satisfaction.

As previously explored, happy employees are more likely to go out of their way to help others and perform well, so generating happiness will drive performance, but driving performance will not drive happiness. Emphasizing the right attributes, from a managerial standpoint, not only enriches the lives of the employees within an organization, but also delivers better performance for stakeholders.

Conclusion

In addition to a happier, more cohesive team and stronger employee work performance, an emphasis on EQ will also prepare an organization to endure the test of time as rapid advances in technology make their onslaught against traditional workforce habits. This essay compared the merits of the qualitative and quantitative analysis methods, the projected impacts of technology on traditional workplace structures, and introduced a new, EQ-oriented performance analysis method.

Advancements in technology will not slow or halt in order for societal norms to catch up with them. America is in the midst of a second industrial revolution, one that is driven by data and destined for AI, so if the workforce does not account for these changes, then the aspects of the workforce which are not ready for them will be left behind.

The far-seeing workforce managers of tomorrow can anticipate these changes by studying observable trends from yesterday and today, then projecting them into tomorrow. There is a very low probability that these trends are stochastic: in fact, it is nearly impossible that they are. The workforce absolutely must educate itself on EQ so that the men and women employed to work alongside AI are cohesive as a team. Managers must emphasize the importance of EQ in the workforce today so that it is a priority tomorrow.

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