Why is an Employee’s Key Result Area Important for Business?

Question 1: Do you think the Employee’s Key Result Area system was born during the start of the Industrial Revolution in Europe. Answer 1 – Big No!

Question 2: When and Where it was Born. Answer 2 – It was Born approx 2500 Years ago in the Land of Bharat during the Mayuran Empire.KRA was born in the Arthashastra Book drafted as a rule book for Mayuran Empire by a Professor  Economist Political Thinker Management Guru Acharya Chanayak.

KRA explains an employees roles and responsibilities towards the organisation he/she is working. A Syllabus of Arthashastra on other hand explained roles an Emperor Army Commanders of various ranks  Chief Officials of various department of the Empire and adding to that even it explained the roles and responsibilities of the Queens and prince/princess. Rewards for achievements of Employee’s Key Result Area.

Punishments and Training for non-achievement of KRA were also drafted in Arthashastra. Thus it is said clear drafted roles and responsibilities were the key factors for successful administration of Mayuran Empire which flourished and ruled for more than a century. So in today’s corporate world what are the reasons that KRA is linked to Business Strategy? and What really leads to both Employee and Employer Growth?

Employee’s Key Result Area and Companies Strategic Synergy

1. Makes Employees Accountable and Sets Clear Goal

By the start of the year, employees know his goals and he makes preparation accordingly. Employee Goals are aligned with the Goals of the Organisation as the whole this helps employees as a guiding star to achieve there Goal/Target.

2. Regular Reviews of the Employees

Through Monthly and Quarterly Reviews of the employee’s KRA achievements, even the organisation’s achievements can be observed by numbers.

3. Increase Trust of the Employees

If a Transparent appraisal is done for an employee based on his/her KRA achievements and accordingly rewards & recognition is done by the employer. Then high-performing employees trust in the Management increases. This lead to the blossoming of happy employees who increase his/her both quantitative and quality productivity. Which leads to increase is overall quantitative and quality productivity of the organisation and thus, the organisation is ahead of his competitor both in productive terms and employee retention.

4. Management Knows the Performer

As each and every employee is rated according to the KRA achieved. Management knows who the performer is and who is an underperformer. And accordingly, rewards and compensation & benefits can be given to employees.

5. KRA Rating helps for future Business Strategy Planning

Management would always have an eye on their performers. Management can plan the Organisation’s succession planning and project planning without any hesitation or spending extra time on succession or project planning.

6. Training and Re-skilling of Average Performer & Under Performer

Management can plan for  Training & Re-skilling of Average Performer & Under Performer to raise the efficiency level of the employee. Thus benefitting the overall productivity of the organisation.

7. Cost-effective Manpower Planning

Efficient implementation of KRA will provide with data which identifies an excess of manpower in one department and shortage of manpower in another department. Thus internal transfers of Manpower can be done which leads to cost-saving due to additional hiring of human resources.

8. Retention of Business

If the above-mentioned points are achieved then the organisation will have an upper hand over its competitor and will simultaneously increase its value and trust of its Clients and Customers.

Thus an efficient implementation of Employee’s KRA (Key Result Areas) eventually leads to the success of an efficient Business Strategy in today’s VUCA (Volatility, Uncertainty, Complexity, and Ambiguity) World.