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Updated by Joanna James on Mar 07, 2023
Headline for 9 methods to calculate employee performance – 9 trusted ways of calculating employee performance.
Joanna James Joanna James
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9 methods to calculate employee performance – 9 trusted ways of calculating employee performance.

One way to make sure that a company is run the way it should be is by calculating employee performance. While there are many metrics, here are a few selected ways of calculating employee performance.


The number of errors

You can identify many things such as product defects by determining the number of mistakes one has done. This is the same as calculating the number of corrections. Why is it so important that we identify them? Well, for one, the smallest error can have a big impact on how the company presents itself – be it written work or bugs in software, it's equally important that you calculate them. For example, if the HR performance management software is malfunctioning, it could mess up the whole process – this could also be the only way of figuring out whether or not you should invest in software like Orange HRM.


Product Defects

This could be a little difficult to measure – but it is essential that you do it. After all, if your end product is defective, it may turn out some of the best customers you have. Calculating product defects is another way of measuring employee performance as it gives you a clear idea as to how low the work quality is – which by the way should be kept at a minimum.


Management by objectives

This is quite new though very effective. One way to achieve your goals is to turn them into individual goals – the new appraisal method is doing exactly that!


Subjective appraisal

This management model enables you to calculate your employee performance several times a year. Your employees will be accessed based on several criteria, and the quality of work is one of them. The new method is called 9-box rigid which is a 3*3 table. For example, if an employee is in the top right corner, it indicates that he or she has scored high on both performance and potential.


Forced ranking

Might not be the best possible way but if you want to get an idea as to who's the best and who's the worst, this method is useful. The manager will rank the employees from best to worst, and this is one way of comparing one employee with another. This way you can replace or give feedback to the bottom employees.


180-degree feedback

With this system, an employee's direct manager or a colleague can give them feedback. 180-degree feedback is often used by people who do not handle customers directly.


360-degree feedback

This is where you get feedback from colleagues, subordinates and managers. This is not one way of looking at it, but a multi-perspective system. By using this method, the feedback on their performance, improvement and skills levels could be more accurate.


The number of sales

This is a simple and obvious way of measuring one's performance. For example, if an employee is focused only on steering sales, given enough time, employees with the best skill set will make most of the sales.


A number of units produced

This is the most traditional way of measuring employee performance. This is a quantitative metric to determine the number of units produced. Though simple, this is not the best way of measuring employee performance and should only be used if the output is straightforward and simple.