Performance Review: Decoding The Structure
It’s that time of the year for performance review season. Employees are on the edge of their seats. Do you get the raise? Are they penalized for the 2-week vacation they took? And the feeling is equally mutual. Managers are often confused about how to conduct a performance review. And as if things weren’t bad enough, performance reviews are highly inefficient. And of course, we do have stats to back it up. 95% of employees are not satisfied with their company’s appraisal system.
The drill is the same everywhere. According to traditional performance reviews, you notify your employees regarding the review a few days prior. Then you prepare what you are going to discuss according to the available reports. Then talk with the person, starting with some positive notes and then nitpicking the negatives. Finally, even your best employees leave the review unsatisfied. The result? An embarrassing failure. Not only are you sending mixed and incorrect messages but also wasting a lot of valuable time.
So What Do We Need to Do?
An employee’s evaluation should be more than just an annual interaction. It's a waste of time and doesn’t provide any substantial feedback. A simple performance rating won’t do the job. Your performance evaluation needs to be more holistic and frequent. Irrespective of your company's kind of evaluation system, there are a few basic guidelines you can follow to optimize your performance review process.
The Early Expectation
Most people make a mistake because they think a performance review starts when you enter the conference room to discuss your performance. It is crucial to understand how you want to evaluate your employees.
It is even more important to communicate the same with your employees.
Make sure you sit down and plan with your direct subordinates about your expectations and targets you want them to achieve right at the beginning of a season.
It will result in higher productivity and performance of your employees because they know what they have to do and what you expect from them. And, of course, when you perfectly lay out the foundations of your expectation, it is much easier to hold people accountable when the numbers don't add up.
Having a more direct conversation with your employees about your expectations helps maintain transparency. It allows you to broaden your professional experience. Having quantifiable expectations from your employees helps them immediately focus on their work in a more structured manner.
The Positives, The Negatives, And Everything in Between
What makes performance reviews so scary is that employees always see them as an opportunity for employers to focus on their shortcomings. It creates an uncomfortable atmosphere between managers and employees.
A few weeks before the actual event, make your employees think of a few things they have done in the past year they are proud of.
It will serve two purposes. Firstly it will refresh the memory of your employees about the way they have positively impacted your company. Secondly, it will pump your employees about the performance appraisal because they know how they have positively impacted the company.
The next thing you need to do is to look over your notes. Make sure you have kept a note of all the times the employees' performance was not upto your expectations. Then you need to take the feedback of a few people who works closely with the employee. It will give you an idea of how your employee is performing with the team.
After you have done these, give your employee a copy of all the feedbacks and notes a few hours from the appraisal. This will give your employees an idea of what is to be expected in the conversation.
You must remember that this is not an interview. You do not need to test your employees’ “on the feet thinking” abilities. You need to treat this as a conversation regarding the growth and development of both the employee and the company.
So you have prepared your employee for the review. The big question now is how do you go about it? Is there a structure to how the conversation should go? Or is it more of a spontaneous discussion about the shortcomings and achievements of the individual?
Luckily for you, there is a structured way that, more often than not, succeeds in providing a holistic review.
Straight of the bat, you would want to start the review with all the positives. But get this, your employee will likely reflect or base his assumptions on how the review ended. It would be best if you ended things on a high and positive note.
Start the review with the shortcomings of the employee and how they couldn't meet your expectations. Start by something small like minor discipline issues and gradually talk about the more serious stuff like missing a deadline. After that, focus on why the person is a valuable asset to the company because of their upbeat performances. It would be best if you made your employee find out why they could ace a particular project successfully. It might be their creative insights or their superior communication ability.
End things on what you expect from them in the coming season. Talk about what skills the person needs to develop to improve their performance and what your company can do to bridge the skillsets gaps. Work on the performance improvement plan for growth and development.
Also, take pointers from your employees during the review on improving employee engagement in your workforce and having a superior work culture.
A performance review is a two-way street. Both you and your employee need to walk out of the review with something to work on.
Do They Get A Raise?
Let's face it. One thing that is constantly in employees' minds in a performance review is how much raise they get. Or do they get a promotion in their role? If you do not address the issue outright, your employees' feelings and expectations will be shattered.
You need to mention beforehand if you are considering the employee for a raise. By beforehand, we mean, at the start of the year. While setting the targets and expectations for the employee, you need to mention whether fulfilling those expectations grants a rise in their ranks or paychecks. It not only makes your workforce transparent but also deems the raise of an employee fair in front of his team members.
Annual performance reviews are going through a monumental shift in structure and pattern. It's no longer "annual." Your performance reviews need to be more of a regular feedback conversation rather than annual reviews.
Here are some pointers of what you need to do. Make it clear from the beginning how you want to evaluate your employees. Focus on the positives and the steps required to fulfill your expectations.
Some things you shouldn't do: Don't offer general feedback that applies to most employees. And of course, do not leave the compensation and raise till the last moment.
And on top of everything, a great performance review structure makes an excellent case for your employer brand.