In modern companies, employees often become subject to performance appraisal or review that measure and assess their efficiency and proficiency.

69% of employees admit that they would work better if they felt their efforts were better recognized. It means that individuals need such appraisal in order to identify their recognition timely.

A performance review is a rational and objective tool that is rather effective. Managers all over the world use it to define whether any training is required, a salary increase is warranted, or whether an employee should be promoted to a higher position.

If you are aiming to arrange a performance review – it’s important to do it in a proper way. In this post, we share some practical and non-trivial tips on how to make your performance appraisals even more efficient. Let’s start with the basics.

What Is a Performance Review?

A performance review (also known as an annual review, employee appraisal, or performance review or evaluation) is a regular review of an employee’s job performance. It also considers the employee’s contribution to a company and evaluates his or her skills, achievements, and growth. 

Performance reviews help companies to give employees relevant feedback about their work and to explain payment or bonuses increasing as well as termination decisions. 

It’s not a good idea when managers without experience use the performance review to unload a long list of criticisms. It should be like an honest evaluation of the employee’s performance, with good and bad aspects. If you build your annual review around the pros and cons, it gives your employees the info they need for growth within their position.

What is performance 360 review?

Image source: (S. Graham)

Why do organizations need to practice performance appraisals?

The situation when companies have a limited pool of funds for awarding raises and bonuses is quite common. That’s why performance reviews seem helpful for determining how to allocate such funds. 

Peer reviews help to define which employees have contributed to the company’s growth more and reward the top-performing ones. Additionally, performance reviews help individuals and managers to plan employee development through training and increased responsibilities and recognize shortcomings to resolve.

Frequent reviews will keep everyone on the same page, generate stronger relationships between managers and employees and accelerate team spirit.

What are the types of performance reviews?

Most often managers evaluate the staff with no input from the subject and it means that such performance reviews are top-down.

However, there are other appraisal types:

  • Self-assessment – when employees rate their job performance and behavior themselves.
  • Peer review – when the group of individuals rates a particular employee’s performance.
  • 360-degree assessment – an event that involves inputs from an individual, a supervisor, and peers.
  • Negotiated review – when a mediator is attracted. He/she strives to moderate the adversarial nature of performance evaluations by allowing the subject to present first.

10 Tips For Arranging Performance Reviews

No matter if you conduct a face-to-face evaluation or compose a written performance review, the following tips will help you inspire the best from your employees.

1. Care about the environment

The comfortable and welcoming environment where you hold your performance review significantly simplifies the objective and puts your employee at ease even before the conversation begins.

You may use even a huge conference room for a performance review but sit next to the employee rather than in the opposite corner.

2. Make job description appropriate

If you have no idea where to start the performance meeting – try to review the job description. The following questions will help you to define the basis for the rest of your review:

  • Did the employee satisfy all the responsibilities listed in the job description?
  • Are there aspects that need to be optimized?
  • Has the job position changed from the time description was written? 
  • Have new duties been added since the individual was hired?

3. Avoid or minimize distractions

Arranging performance reviews in a neutral location (other than your office) is a great way to avoid possible distractions. Even emails, phone calls, or other simple interruptions can diminish the effectiveness of what you have to say.

In case you run a performance appraisal in your office, switch off your phones and turn off your emails. You may even hang a “Do Not Disturb” sign on your door – this is also an effective method.

4. Set clear goals

Analyzing old or current goals together with setting new directions is critical for every efficient performance review. Setting specific and measurable goals for your employees, you provide them with something to work toward. In fact, you give them a way to evaluate their performance.

5. Run meetings frequently

Initially, a performance review is an annual event. However, it’s good practice to provide feedback throughout the year. Usually, companies run performance reviews at the end of global projects. Some of them hold them once a quarter.

Set a frequency that appropriates right for your business and be sure that the performance meeting isn’t a surprise for team players. Everyone should be aware of when it’s coming.

6. Be honest and open-minded

Honesty is the key to many doors. Do not hesitate to be open with your team members about their performance. 

Everyone will quickly understand when you’re being overly flattering. The process of reviewing is rather hard without making your employees decipher what you are aiming to say.

7. Start and end with a positive attitude

A good idea is to run a performance review in the following way: start and end with the positive moments and fill the middle of the meeting with the negatives.

Most likely, the last thing you talk about will be what a person remembers most. So try to end on a positive note, even if he/she has plenty of things to work on. They will feel good about themselves and secure.

8. Highlight only the key points

In common words, any performance review should be based on the following core points:

  • Company-specific competencies
  • Position-specific competencies
  • Achievements

Competencies may contain skills, knowledge, attitude, and anything important for the job.

9. Analyze and weight all aspects of the employee’s performance

Every competence will definitely differ in importance. You need to weigh each aspect of your employees’ performance. You can do it using a percentage grade. 

For example:

  • Commitment to the company (as a company-specific competence) may be worth 15 percent. 
  • Customer service orientation (as a position-specific competence) may be worth 35 percent.
  • Meeting deadlines ( the example of achievement) may be worth 50 percent.

10. Add informal feedback 

Try to avoid limiting feedback to formal and scheduled occasions once a year. Add some informal assessments throughout this period.

If there’s something to optimize, note it in a file so you can refer to it when it comes time for the annual reviewing. It will help the employees work on their strengths and weaknesses on a daily basis.

Final thoughts

Take these performance review tips and practice these recommendations during your next appraisal meetings. That will be a significant tool for your management toolkit.