The secret to successful performance reviews

Performance review meeting

Employers should look at the purpose of performance reviews as a process that helps to improve the company.

By assessing an employee’s performance, you can learn more about the value they bring to the business, their strengths, and weaknesses, and whether their goals are aligned with the organisation’s objectives. Understanding this can improve communication, collaboration, management/employee relations, and ultimately enhances the employee’s productivity and the culture of your business.

How often and why?

The frequency of performance reviews is determined by you. They can be conducted monthly, quarterly, and annually depending on the size and the needs of the business.

Monthly – while some businesses find monthly reviews unnecessary others prefer holding regular catchups instead of annual reviews. This frequency allows the business to stay on track, especially when working on projects with tight deadlines, or with short term contractors or temp workers. This works well in an agile environment.

Quarterly – holding reviews every three months gives both the employer/manager and the employee time to achieve their goals and targets. It is a realistic timeframe to assess how the employee is doing and for the employee to discuss concerns or opportunities with the ‘boss’.

Annually – A growing number of businesses no longer hold annual reviews. Instead, they are being replaced by monthly appraisals. However, if you only want to conduct annual reviews there is one mandate to abide by, ‘No Surprises.’ No one should be asked to discuss or address an issue they weren’t previously aware of earlier.

How to structure the review?

There are many different types of performance reviews. To keep things simple, and for the sake of this article we’ll consider the single input quarterly review, which is a review between the employer/manager and employee without input from colleagues and peers.

The structure should include:

  1. Overall performance – When reviewing each quarter, you will likely have a reasonable idea of what has been achieved. However, it is up to the employee to track and monitor their KPI’s (Key Performance Indicators). These should align with the goals set previously. You’ll want to discuss their progress, what wasn’t accomplished, and what roadblocks are preventing the employee from achieving their goals.
  2. Employee strengths – This is an opportunity to show the employee that you have noticed and appreciate their contribution to the business. Ask the employee what they believe their strengths are regarding their role, capabilities, and traits. Reciprocate by recognising what you see as their strengths as well. Part of this discussion is identifying growth opportunities and career development.
  3. Areas of improvement – None of us are perfect. We have our own idiosyncrasies. Time management is easy for some and impossible for others. You could discuss topics such as adapting to change, teamwork, communication, customer service, plus anything that relates specifically to their job.
  4. General – There will be other topics that come up in the conversation, but you want to make sure that you ask the employee if they have any concerns, questions, or need anything to be clarified. If there is anything else, you need to address now would be the time to mention it.
  5. Next quarter goals – What are the expectations for the next three months? Use the SMART model (Specific, Measurable, Achievable, Realistic, and Timely). They should align with the business objectives – it won’t help the business if people are on different trains going to different destinations.

What questions should I ask?

Most managers and employers find conducting performance reviews as nerve wracking as the employee. The answer lies in knowing what questions to ask and how to present them to ensure a mutually advantageous and friendly discussion.

How you phrase your questions will set the tone of the meeting and avoid any potential disagreements.

For example:
Ordinary – How would you rate your performance this quarter?
Good question – What accomplishments this quarter are you most proud of?

The general idea is to guide the conversation not to dominate it nor to cross examine. Be willing to listen and to learn from the employee. Don’t make assumptions. If necessary, repeat back to the employee what they have said so you are sure you have understood them. We’ve compiled a list of helpful questions to get you started.

Preparing for the review

Consider the previous performance review. Are the goals and objectives still accurate and aligned to the business objectives?

  • Send the employee a performance review worksheet so they know what to expect and what to prepare for. They will need to fill in some details in advance of the meeting.
  • Consider the questions you want to ask the employee.
  • Be prepared with constructive and specific feedback.
  • Prepare for questions the employee might ask you.
  • Don’t leave everything to the last minute, you’ll feel stressed and come across as indifferent.

Just like your company culture your performance review process will be unique to you because it aligns with your values, objectives, and purpose. There are many practices; some businesses will use question and response formats while others will be more free flow.

[The performance review worksheet is a word document and can be customised using your company brand]

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