Performance Reviews: Why do they matter?

Performance Reviews: Why do they matter?

A performance review is a formal assessment in which a manager evaluates the performance of an employee, identifying strengths and weaknesses whilst giving  feedback, and setting goals. This gives employees an ideal opportunity for self-evaluation.

You might wonder, why is a performance review important in my business? But, they are crucial to your success giving employees more motivation and enhancing overall productivity. In short, they let employees know what they’re doing well and highlights any areas they need to focus on to be even better at their role.

Incorporating a performance review into your internal communications strategy is essential. However you choose to conduct them and no matter the size of your organisation, your employees need to know how they’re doing in their career. If you haven’t embraced performance reviews yet, don’t worry, this short guide will deliver everything you need to know from how often you should to them to the dos and don’ts.

Why is a performance review important? 

A performance review is extremely beneficial  to the development of your employees. By conducting a performance appraisal, they’ll have an idea of how they’re getting on in their role, identify areas for improvement and conduct a self-evaluation. It’s also a chance for your employees to give you feedback; this could be feedback about the performance review or feedback about leadership in your organisation. They’re a two-way process that requires a lot of communication from both parties.

It’s also important to conduct regular performance appraisals for the peace of mind of your employees. Being left in the dark about anything is unsettling, but when you’re left unaware of how well you’re performing it can feel worrying.

How often should I conduct a performance review? 

When setting out a performance review remember that all your employees are different. If you have new additions to the company it’s important you set out a performance appraisal around three months into your employee’s new role. This will enable you to identify the strengths of your new employee and identify areas to improve. Remember, starting a new job is daunting for almost everyone, so having a performance review early on in the process could be the boost they need to reassure them that they’re doing well in their new role.

Normally, you should conduct a performance review for regular employees around 2 times a year, so every six months. This will give employees a clear time-frame to prepare for their performance appraisal and the six-month gap also gives them time to work on areas that needed improvement from the previous performance review.

The Do's of a Performance Review 

A woman wearing a white shirt and glasses sitting at a desk handing a piece of paper over to another person

Create a relaxed atmosphere 

Try and make your employee feel as relaxed as possible throughout their performance review. If you create an atmosphere where your employees feel uncomfortable you could risk them being scared about sharing important feedback or becoming unhappy at work. Although you’ll be covering important topics throughout the performance review, try and make your employee feel comfortable by making general conversation prior to the performance review. By doing this, they’re more likely to be accepting of what you have to say and give their feedback.

Welcome feedback 

Like we mentioned previously, it’s important for your employee to give you as much feedback as possible during their performance appraisal. This process is focused on the employee so it makes sense for them to do most of the talking during the review. If they give you feedback, ensure you welcome this feedback and take a note of it during the meeting so you can take action.

Make notes

Probably the most important point of all, remember to make notes from the performance review. We’ve all been to meetings where a bunch of important things were discussed but we’ve come away from the meeting with nothing because we forgot to take notes. Documenting what was discussed throughout the meeting will help you when it comes to planning the next review and is also helpful so you have a record of what was said.

Set goals 

Ensure you have a clear set of goals to give you your employee after the performance appraisal. There has to be an outcome to the meeting otherwise it would just be a waste of time for both parties. Once you’ve identified areas for improvement, agree on some achievable goals for your employee to work towards for the next performance review. Remember to ask your employee if they feel comfortable with the outcomes set and if they think they are achievable within a six-month time frame.

The Don'ts of a Performance Review 

Don't let the negatives outweigh the positives 

In a performance review, there’s no avoiding the elephant in the room; there will be negative aspects you’ll have to touch upon. This could include areas your employee needs to improve on or it could be a negative experience in the workplace. Try not to focus on the negatives, this will leave your employee feeling unhappy and very deflated with their performance. 

A top tip from us would to always start and end the meeting on a positive note. If you begin with a negative your employee will start to feel anxious about the rest of the meeting whilst ending on a negative will leave them feeling deflated and will most likely mean that they forget the positives.

Don't set unrealistic goals 

Make sure you set realistic and achievable goals going forward from the performance appraisal. As a leader, seeing your employees perform to the best of their ability and getting good results is all you want, but setting unrealistic goals and rushing to get there will not be beneficial to you or your employee. It could put a strain on your employees and lead to burnout if they feel under pressure. As this is a self-evaluation of performance on the employee’s behalf, it’s important you give them the autonomy to manage their own goals and set their own time frames.

Summary 

It’s no secret that a performance review is needed within any organisation. They can facilitate an increase in performance, productivity and is a chance for employees to complete a self-evaluation. So, if you want your employees’ performance to grow, start planning your performance reviews.

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