Building an Effective Employee Performance Review Process

Experts believe that at least 50% of employee performance problems occur because of a lack of feedback.

Annual reviews can be a beneficial development tool to identify, measure, encourage, evaluate, reward, and improve employee performance. Documenting employee performance is an essential human resources management practice that can help avoid misunderstandings that could lead to legal action.

A performance review should NEVER be a surprise.

Feedback between the employee and manager should be ongoing and then formally summarized at set intervals. The process must be viewed as fair by employees. It should be balanced for an overall positive experience with constructive feedback included. Many organizations ask employees to complete a self-evaluation as the first step, which provides valuable insights into how the employee views their performance.

Tips for success.

There are many elements of a successful performance review process, but here are a few tips:

• Establish well-written job descriptions outlining essential functions, standards, goals, and expectations.
• Prepare in advance and plan for the process.
• Link company strategy to specific objectives and results.
• Evaluate yourself before your employees: How is your management helping or hindering performance?
• Be objective and honest, using specific and accurate examples.
• Remember to evaluate performance, not personality.
• Identify development opportunities.
• Ask if the employee has questions or concerns.
• Put mutually decided objectives in writing.
• Show that you’re invested and that you care.

Whatever your performance review process, it must be completed on time to reflect a sense of importance and urgency.

Top-level support is a critical key to a successful program. While this seems obvious, lack of support is the main reason performance evaluation systems fail to succeed. Supervisors and staff can quickly sense if top management fully supports the process or gives it lip service. Upper management must demonstrate in words and actions that it is determined to see the process succeed.

Additional Resources:

Conducting Performance Reviews
Why Organizations Do Employee Performance Evaluation 
Ten Tips for Conducting Employee Performance Reviews