Instructions on how to conduct an effective employee review.

How to Conduct an Effective Employee Review

Posted June 15, 2015 by Jacob Donelly in Managing Your Team
Conducting an effective employee review actually requires doing some homework ahead of time.

There’s a good chance we've all experienced an employee review, whether it's a peer-to-peer review or a manager-employee review.

If you’ve ever conducted one, you know that they’re a little uncomfortable and bizarre, especially if they are done irregularly. However, putting a plan in place will easily grow the review's effectiveness for both participants.

Building a review plan has a number of benefits:

  • You'll set employee expectations. Employees can’t know your expectations unless you communicate them clearly. Employees don’t read minds (though that would be nice sometimes).
  • You'll track the good and the bad. In the event that you need to promote - or fire -  an employee, you’ll have considerable data to support that decision.
  • You’ll know what your employees need before it becomes a desperate issue that warrants drastic action, like the employee quitting.
  • Your operation will run more smoothly. And who doesn't want that?

Before you venture out and conducting your employee review, set a plan in place with a few important factors. 

Set Goals Off the Bat

Before you can review employees' success, they needs to know what they're being compared to. It is imperative to have already set up employee goals, so that they're not caught by surprise in your review.

This means that your first step takes place long before the review itself. Meet with employees when they’re hired to lay out what you want their goal to be. For example: if you just hired a sales person, you may want them to sell $30,000 a quarter. That’s the goal.

When the employee review comes around, you can look and see whether or not that sales employee actually accomplished his or her goal. Did he or she sell $25,000 in one quarter, but $40,000 in another? If a goal wasn't met, had the employee gone above and beyond expectations working to meet that goal? Or had the employee not exhibited motivation in the office? Was the goal met by collaborating with fellow employees? 

Goals are employees way of knowing your expectations, and the gateway to a constructive conversation on their work. If they know you’ll expect X, they will create plans to achieve X. And if they fail at achieving X, they’ll be able to explain why in their review with you. 

Communicate Employee Progress Consistently

It’s easy to fall into the habit of only giving feedback—good and bad—when the review time hits. The reality is, if you want to see your employees succeed, you should be giving them feedback and praise on a regular basis.

Did that sales employee sign a really amazing contract that is going to blow his or her quarterly goal out of the water? Send an e-mail thanking the employee for his or her hard work and detailing why the accomplishment is really great. This will reinforce the employee's productivity, motivation and attitude.

On the other end, did he or she give a lackluster presentation to a potential client? Offer constructive feedback on how the goal could have been achieved more effectively. Treat every event as a moment to offer praise and feedback.

Do Your Homework

Some preparation is involved before you conduct your review. Your homework includes collecting all your documentation on their successes, their failures, office interactions, responsiveness and any other administrative paperwork that can support your argument of whether or not they achieved the goals you assigned.

Once gathered, the next step is to write up your review of the employee. An employee review is generally is broken up into three parts:

  • What was the goal?
  • Did they achieve that goal?
  • Why do you think they did or did not achieve that goal?

Each part of the review should be broken down into those three points. That way, you can jump from goal to goal and have a complete conversation about whether or not they actually achieved what you had set out for them.

Provide the employee with this document a week before your review. It's easy to get defensive when you hear that you're not doing something correctly. Reading and processing your thoughts before the review gives an employee time to digest your feedback and prepare responses.

Simultaneously, ask employees to prepare their own review of themselves using the same three questions. Doing so will give them a chance to make their arguments about the goals and whether they succeeded. This is particularly useful if you have to send their review to Human Resources to review everything.

Conduct The Employee Review

By the time the review rolls around, you should be prepared to have a constructive conversation. 

Once you’re in the room, remember to be honest and candid. Negative feedback might be hard to swallow, but doing so gives employees the opportunity to change and grow. If they didn’t reach a goal, explain to them where you feel they didn’t excel. Always give employees the change to explain why they didn't meet expectations. Perhaps they feel you set an unrealistic goal to begin with and only after having tried to achieve it did that understanding come to them.

The most important thing to remember is that this review needs to be a conversation. If they are engaged, the results will benefit you. Some questions to ask them are:

  • How can I help you to achieve your goals more effectively?
  • What did you find particularly difficult about these goals?
  • Can I give you better feedback somehow?

The more that you engage with your employees, the more they will feel empowered at their job. The goal for you should be to increase that empowerment. They’re less likely to leave if they feel that their voice is heard and they have a say in their growth at the company.

At the end of the day, the employee review can help you build a wonderful relationship with your employees. It can also strengthen the employee-manager communication channels, ensuring that if something goes wrong, you’ll know about it immediately.

Check out our sample termination letter for tying up loose ends.

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This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.