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Conducting Employee Reviews

Employee reviews should benefit both of you. Here's how to make the most of them.
December 14, 2007
URL: http://www.entrepreneur.com/article/188460

With the end of the year approaching, now is an excellent time to take inventory of your most important business assets. Your employees should be at the top of that list.

Keep in mind that employee assessments should be an ongoing process, not something that happens once a year. An effective year-end assessment involves reading the notes you've been making about employees' performance and attitude throughout the assessment period. (If you haven't been taking notes this year, it's well worth considering for next year.)

This annual or semi-annual assessment allows you to provide and receive feedback. It's also a wonderful chance to summarize your perceptions of an employee's performance and compare it to the employee's self-appraisal. And you can share and compare views and plan for the new year.

Performance appraisal or assessment interviews allow you to do the following:

The best way to recount the past year is to use terms that describe behaviors and actions. This method reduces employee defensiveness, and your language can be more concrete and specific. Simply saying, "You did a good job," or "You need to improve your productivity," is not effective.

These comments are too general. What does "improve your productivity actually mean?" Does it encourage the employee to come to work on time? To put forth more effort? How much effort? In what areas and circumstances? With whom? When? And most importantly, how?

On the other hand, statements that are measurable and specific can be worked on more effectively. Here's an example: "In the coming year, I would like to see you increase your daily productivity by 12 percent."

"Ensure that you follow up with your team leader every time you complete a task" is a very specific instruction. The outcome is that both you and the employee will then know exactly how, when, where, with whom and under what circumstances the employee will be successful. The words "improve" and "successful" will now be explicit.

Implementing an Appraisal Process
Begin by notifying employees that you would like to have a meeting with them to evaluate their work during the previous year. This performance appraisal time will be a mutual sharing of perceptions regarding employee accomplishment. Then give them a copy of the appraisal form you will use so that they can read it, reflect on the past year and complete it prior to the interview. Encourage them to emphasize areas both in which they did well and areas in which they need further growth and development, especially the former.

Additionally, have them consider their goals for the next six to 12 months. These should be "stretch" or "growth" goals--just out of reach of the employee's current performance to encourage working harder in the same or new areas, but not so far as to cause frustration or failure.

Like the performance appraisal itself, these goals need to be action-oriented, specific and measurable. That way, the employee will know exactly what he and you expect and how success will be defined and determined. By reflecting on the goals and putting them in writing, the employee increases the probability of achieving them.

At the same time that the employee is preparing for the meeting, you'll also need to map out what you want to accomplish. Conceivably, your views and the employee's views will differ. That's OK; that's what perceptions are all about. The appraisal interview is an excellent opportunity to share perceptions around specific behaviors and translate them into realistic and achievable goals.

To accomplish that, recall specific events, interactions, attitudes and productivity from the past year. It can be very helpful to write them down and put them in the employee's folder when they occur, as a reminder to yourself for the appraisal. Don't let that stop you from "catching your employees doing something right" and telling them about it at the time it occurs. In planning for the session, make sure you can balance your comments with examples of behaviors that were both effective and ineffective. This isn't the time to "beat up" on anyone; nor, however, is this the time to gloss over inadequacies or errors. Remember, your goal is to achieve optimal productivity in a positive environment.

If improvements are necessary, be ready to point them out. However, when need-to-improve statements are made, they should be couched with positive statements to improve the likelihood that the negative statements will be heard, accepted and acted upon. For example, you might say, "I liked the way you handled the irate customer yesterday. That same kind of even temperament and politeness, however, are needed in your actions with the customers all the time."

Finally, conduct your feedback portion of the interview. Remember, if you start the interview with your perceptions, then the employee might feel the need to respond defensively to your statements. Therefore, allow the employee to "go first" to share his views. Then you can comment on similarities and differences in perception, keeping in mind that this interview is about improving attitude, employee and employer satisfaction, and performance in achieving goals.

Before the interview is completed, make sure that both the employee and you know specifically and measurably what went well this past year and what did not. Ensure that you agree on concrete plans to maintain and increase positive performance, while minimizing or eradicating negative performance. Both of you need to agree on future behavioral goals to achieve success, along with benchmarks during the coming year to measure accomplishment.