Human Resources has a great deal of responsibility in a company; hence HR assessment needs deliberate and thoughtful protocols. For a business to grow, it needs to analyze what is working well in the company, and which areas require improvement, HR as a major part of the organization is no exemption.

Here are top 5 HR assessment methods.

#1: 360-degree feedback

This method requires the HR manager and assessor to collect feedback on an employee’s performance from everyone affiliated with them. The employee’s peers, reports, direct managers, and managers from other departments that the employee conferred with on a project, are all asked for their feedback on the employee’s performance, their work ethic, their deliverables, general competence, and their behavior.

The 360-degree feedback method ensures that the assessment system takes into account multiple points of view for a holistic report from in-house and remote working staff. And it is an important way to understand how an employee works within a company with the virtue of excellence. By speaking to everyone involved with a single individual, You can get insights into how they handle goals, stress, project management, and whether the person deserves to be moved into a leadership position.

✅❌ Pros and cons

The 360-degree feedback method gives the assessor a wholesome view of an employee’s abilities, not only in the professional arena but also as a yardstick for understanding interpersonal interactions. However, it can take a great deal of time and money to conduct the method, particularly if the company has a very large staff. The feedback one receives for each team will also have to be personalized to some level – the amount of physical labor produced in one department may not be comparable to another. One also needs to prioritize the areas of focus in the assessment – is it more important for employees to strive to achieve company goals or to create a collaborative environment? Weighing the analytics achieved from this method can take some trial and error but one can reach a standardized system with careful planning.

#2: Assessment center

The Assessment Centre Method takes HR assessment outside the confines of the office, often to a central location where managers, assessors, and employees can gather. In the Assessment Centre Method, individuals are asked to perform a series of tasks or are grouped together to perform tasks. Interestingly, this method was first created in the 1930s by the German army and has since been adapted for modern employment. In this method, assessors can examine very particular work-related skills that employees and applicants will need in a company by giving them exercises, conducting workshops, role-playing games, and simulations.

While this method can give HR managers a wealth of knowledge about the social and interaction skills of individuals, it does not give you any specific role-related data. Additionally, because of the competitive nature of the exercises, one may end up breeding an overly competitive environment that will overlap into company culture after the tests are complete. As a system for checking on interpersonal skills, the Assessment Centre Method has its benefits, but it should be paired with another assessment for more comprehensive results.

 ✅❌ Pros and cons 

 The Assessment Centre Method has its advantages – by taking employees out of the confinement of the workplace, one can see how they organically react to situations. However, as noted above, the competitive nature of this method can bring to the fore unhealthy behaviors – while that may be telling in and of itself, the employees then need to return to the workplace where the actions performed during this assessment may lead to resentment. This method should be carefully monitored and administered only alongside another method for the best results

#3: HR Cost accounting

Employees are a resource for businesses, just as capital and machinery are. In that sense, there needs to be an account of how much cost is going into maintaining human resources, and what kind of labor output is being gained in return. In the Human-Resource Cost Accounting Method, the HR managers are asked to look into how much is being spent on individual employees’ training, compensation, and development. HR managers then have to balance those costs against the productivity of the employees and whether the training and development programs have resulted in higher yield for the company. 

Not everything can be decided according to a money in-productivity out system, however- some employees bring more value to the company than just their labor. For example, a few employees may boost morale, others may have invaluable external contacts, and another group may show their teams how to work smart. This is a very cold and calculated way of looking at human capital, and should not be the sole assessment criteria used to determine the future of employees in companies.

 ✅❌ Pros and cons 

There is value to using the Human-Resource (Cost) Accounting Method – it does show you the kinds of gains and losses your human capital is bringing in. However, this is another method that takes time and energy – one needs to collate costs from across the company and compare it to what is being earned or lost per employee. A single error could mean the end of someone’s employment so this is not a foolproof method to rely on.

 #4: Management by Objectives (MBO)

Management by Objectives (MBO) was coined by Peter Drucker, author of several management books and well-known guru, and is one of the most popular assessment types used by HR managers. In this method, employees and managers sit together at the start of every year, or quarter, and outline goals and the processes needed to reach those goals for the next financial period. This assessment type is ideal for a collaborative environment and makes the interpersonal relationships between managers and subordinates much stronger. Setting achievable goals will motivate employees and make their work more easily measurable – such as a 10% increase in social media followers, or 15% more unique website views – and help to create more manageable monthly reports.

However, it is important to ensure that there are enough goals for an employee to be engaged and motivated, but not too many, as that will put undue pressure on the employee. This method yields strong results but fails to take in interpersonal and communication skills, so it should be paired with another method like the 360-Degree Feedback assessment.

 ✅❌ Pros and cons 

Almost all companies use the Management by Objectives (MBO) assessment method – the results are measurable and it gives employees dedicated targets to strive towards. It takes up the least amount of time for managers and HR teams and has had great results over the years. The MBO method has its advantages but it has been used by managers to give employees unreasonably high goals – almost punishing them for high achievements in the past. This should be noted and avoided as much as possible – employees shouldn’t feel afraid of achievement because they will be overburdened, as a result, in the following year.

#5: Field review

One of the more traditional assessment types is the Field Review Method. In this method, a person from the HR department shadows and assesses an employee to evaluate their working styles, effectiveness, and output. This method can be labor-intensive, especially for HR as they will need to take a significant amount of time out of their schedules to study the employee. Additionally, the HR team may not have a thorough understanding of another department’s methods or their work – this will make assessment tricky.

However, if the HR team is concerned that employees would otherwise not be getting an unbiased review from their managers or peers, the Field Review Method can be effective. This method needs to be seriously considered before implementation so that the results are as accurate as necessary.

✅❌ Pros and cons 

The Field Review Assessment method is rarely used in the modern workplace setting- with larger corporations becoming the norm, it isn’t possible for HR teams to perform this process. However, this system could have merits in smaller, controlled environments – as long as it is paired with a more thorough and efficient, as outlined above.