Regularly reviewing employee performance is vital for businesses, as it provides both employer and employee with important information about the employee’s progress, needs and skills.
It can also help improve employee productivity – but only if it’s done in the right way.
Reviewing employee performance effectively often presents a significant challenge to smaller businesses, and can be met with resistance from employees and management.
But if done right, performance reviews can build employees’ confidence, allow them to learn from their mistakes and help them reach their full potential.
What is a performance review?
A performance review, or appraisal, is the process of evaluating an employee’s performance against the organisation’s goals and objectives. The aims of performance reviews are to:
- Increase employee engagement
- Establish clear roles, objectives and expectations
- Improve performance and boost overall productivity
- Develop systems that reward strong performance and incentivise achievement
Improve team strength & productivity
Along with carefully vetting candidates before employing them, effectively reviewing performance is one of the best ways organisations can ensure their team is as strong as it can be.
Traditionally, performance reviews are carried out annually. However, research suggests that the yearly performance review is an outdated method of evaluating employee performance that can actually harm productivity and decrease employee engagement.
So what sort of methods can businesses adopt instead? Here are 15 performance review tips that should help boost productivity in your team.
1. Identify the goals of your performance review process
Before starting a performance review, you need to know what you want to achieve through it;
- Are you looking to boost productivity?
- Do you want to increase employee engagement,
- Is lowering staff turnover key?
- Are you trying to identify and develop new leaders from within your team?
If you know what your aims are, it will be much easier to develop a performance review system that will help you achieve them.
2. Define each role clearly
Before reviewing an employee, make sure you have defined their role clearly. This should include a comprehensive description of the role’s duties, goals (long, and short-term) and key objectives.
Set goals that are clear, realistic and specific , with a clear timeframe. You should also have a solid metric in place for how progress towards these goals will be measured.
3. Give employees a say from the start
Once you’ve defined an employee’s role and objectives, you should give the employee an opportunity to offer feedback on them.
As the person doing the role, they are best placed to offer insight into what goals and skills are necessary to be successful in it.
Asking for their opinion from the start will also help to establish trust between you and your employees, and may make them more open to the review process.
4. Be open about what the performance review will involve
Once you have a performance review plan in place, share it with your employees so that they know what to expect.
Make sure they know:
- What the performance review will involve
- Who will be carrying out the performance review
- How often their performance will be reviewed
- How their performance and progress will be measured and evaluated
5. Review employee performance regularly
Performance reviews should be done regularly in order to be effective. A study by Gallup found that employees who received regular strengths feedback had turnover rates that were 14.9% lower than those who didn’t.
Arrange regular performance review meetings with all employees. These could be quarterly, or even monthly – the more frequent the better. Keeping meetings fairly informal will also help to get employees onside.
6. Focus on solutions, rather than problems
Focusing on the positives rather than the negatives is much more likely to encourage improved performance.
Start by praising the employee on their achievements. If there are areas that need improvement, offer constructive criticism and identify ways they can overcome their challenges.
Effective performance review should be a process of coaching and progression, rather than punishment for poor performance.
7. Encourage two-way feedback
Establishing trust between management and employees is vital to an effective performance review.
The performance review process will, of course, involve management giving feedback to employees – but this should go both ways.
Give employees the opportunity to offer honest, constructive feedback on management. This will help employees feel valued, and encourage them to buy into the performance review process.
8. Review goals and objectives regularly
Goals don’t have to be permanently fixed. Assess employee goals and objectives on a regular basis, and review the changing needs of the organisation and its roles.
If adjustments need to be made, discuss them with the employee in question and come up with a new goal together.
9. Give clear, actionable feedback
The feedback you give employees should include clear, actionable steps the employee can take in order to improve their performance and meet their goals.
Come up with a performance plan together to help the employee visualise what they’re aiming for, and what they need to do to achieve it.
For long-term goals, break the plan down into smaller, short-term steps the employee can take to make them more manageable.
10. Monitor progress towards targets and goals
If your employees have specific targets to work towards, use analytics and metrics to measure their progress towards them.
Monitor these regularly and keep your employees updated.
11. Recognise and reward strong performance
This is one of the most important parts of successful performance review.
A study found that 69% of workers said they would work harder if they felt their efforts were better recognised. In fact, recognition is the number one thing employees say their manager could give them to inspire them to produce better work.
You should recognise and reward employees’ achievements and accomplishments, regularly and publicly. This will help keep employees motivated, happy and engaged, and encourage them to work harder.
12. Make sure communication lines are open
Employees should feel like they’re able to talk to management when they’re struggling or have issues.
Encourage your employees to tell their manager when have any concerns or problems. If employees feel able to communicate openly, they’ll be more likely to seek help when they’re finding things difficult, and thus more likely to overcome their challenges.
13. Foster shared values in the team
A workplace with shared values, expectations and beliefs will be more cohesive and harmonious, which is likely to increase employee engagement.
Try to foster this shared culture in your organisation. Management should lead by example, encouraging colleagues to exemplify the organisation’s values in the workplace.
14. Focus on the professional, not the personal
Giving criticism can be difficult, and should be done sensitively.
When reviewing an employee’s performance, be sure to focus on behaviour rather than personal characteristics.
For example, pointing out that an employee has made the same mistake several times is giving feedback on behaviour. Saying that the employee is careless is commenting on a personal characteristic.
The latter is likely to be viewed as an attack, and the employee may get defensive rather than taking on board constructive criticism.
15. Encourage employees to give each other positive feedback
Ask employees to give each other positive feedback.
Receiving good feedback from multiple sources will make employees feel recognised, and being asked to give feedback will make them feel as if their opinion is valued.
This will help to improve employee engagement, and in turn boost productivity.
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