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The thought of an ‘end of year’ performance review can have an unnerving effect on both employees and employers. Apparently, performance reviews can be traced back as far as third-century China. Fact or fiction, the truth is performance and appraisal reviews became more evident after the Second World War – so no more than 60 years ago.
The question is, are performance reviews still an adequate tool to monitor and assess ones performance. Do they motivate employees to do better, and encourage your high achievers to excel in their chosen field?
Some may argue, that a poorly executed performance review can decline a person’s overall development. Stamford University’s Professor Bob Sutton concluded, that doing performance evaluations is like doing “Blood-letting well – it is bad practice that does more harm than good in all or nearly all cases”.
I don’t entirely disagree with Sutton’s theory however if conducted correctly, thoroughly, and effectively, the performance review outcome will be a win-win for both employer and employee.
So the question is, how do you as an employer conduct an effective performance review so everyone will benefit?
First, look at a performance review as a ‘step by step’ process. As an employer, know your staff first and foremost and know what activities they’ve been working on. As a larger scaled business, hold monthly meetings with your various department line managers to understand strengths and weaknesses. Smaller size businesses, an individual catch up for 30 minutes will be more beneficial for your long-term outcome, and in turn will build rapport with your staff. Ultimately, when the time comes there’ll be no surprises.
The tension is always going to be heightened at review time, so why not ‘kick start’ the review with open dialogue. Write an agenda prior so your employee knows what to expect, once again no surprises. By no means, start off with a negative tone. Begin with highlighting strengths and what they as the employee, and a team/business have done well throughout the year. Then move on to constructive feedback, and potential issues that need to be raised.
Now, unless you’re “superhuman” everyone will have strengths and weaknesses. The way you outline weaknesses to your employee will be invaluable long-term, don’t dwell on a goal(s) that was missed, discuss a similar scenario and work through the outcome/goal together. By turning the negative into a positive, will aid in the employee not losing faith in themselves. Maybe a short course could be an option, see it as a positive as you will be investing in their future and the future of the company.
And remember if you as the employer are doing all the talking this will also come at a disadvantage.
Even if your employee is exceptional at what they do and targets were met, there will always be room for improvement. Don’t let the ‘over achiever’ fall into complacent mode. As Mao Tse-Tung says, “Complacency is the enemy of study. We cannot really learn anything until we rid ourselves of complacency”. So think about specific skills that your exceptional employee could develop to reach their new goals. Also let them know what is in store for them, i.e. promotion, payrise or more responsibility.
When closing the review, ensure both parties are on the same page. As Lisa Quast from Forbes discussed in her article, How To Make Performance Reviews Relevant, by focusing on gaining a mutual understanding and an agreement on all aspects of the review will help ensure that the employee hears the employer’s point of view, and vice versa, and that you reach a mutual understanding on shared views of their working world and future.
Employees should not walk in to a performance review petrified of what is to come, nothing should be a surprise. As Quast says, if you’re doing your job properly throughout the year, then the annual performance appraisal should be merely one more discussion in the on-going dialog of how the employee is performing.