It's August. Time for Employee Reviews?
An old joke among human resources professionals is that employee reviews are like fruitcakes. They come once a year whether you want them to or not.
Unfortunately also like fruitcakes, reviews tend to come once a year during the holidays—when work has piled up, employees are eyeing bonus compensation, and vacation time feels long overdue. To alleviate some of the stress, and bring about positive change for individuals and the company overall, human resource experts say employees should be reviewed earlier and more often. Most recommend at least a midyear meeting as well as an end-of-year review that covers bonuses or raises.
"Employee reviews are a process that should happen all year long," says Paul Falcone, author of 2600 Phrases for Effective Performance Reviews. "How much do you value me as an employee if out of the 2,080 hours I work, and—Lord knows it's more than that—you only give me one review? It's just not enough."
Summer's not over yet. There's still time to fit in a midyear meeting to outline and assess performance goals, address problems, and set your employees up for success in the coming months. Here are five tips for a successful review process that delivers results.
1. Separate reviews for professional development from those for pay increases
One of the biggest reasons you should arrange a midyear meeting is to help separate the session when an employee's performance is discussed, and the one in which compensation is set.
"You can't get someone to really be listening and trying to learn about what they can do to change or problem solve when they know the meeting is about what their bonus is," says Michael Beer, chairman of TruePoint, a management consulting firm, and professor emeritus of business administration at Harvard Business School. "They're going to be very defensive and closed."
In a developmental discussion and review, Beer says an employer and employee should use the opportunity to problem solve. By leaving results out of the discussion and saving them for an end of the year compensation conversation, the review becomes more of a dialogue about what an employee can do to improve and what an employer can do to help.
At the end of the year, when it's time to talk bonuses or pay increases, don't do it in the same session as the performance appraisal. Even then you can discuss pay a few days later so employees are focused just on the review itself.
2. Be honest
It might sound like an obvious piece of advice, but HR expert Paul Falcone says the biggest mistake employers make when reviewing an employee is inflating feedback to avoid confrontation. This doesn't help the employee improve and puts a major roadblock in the way should an employee need to be fired down the road.
Keep the conversation open-ended, and allow employees to respond to a supervisor's comments. Focus on issues, not people.
3. Put down the form
Many managers give a performance review simply by running down a company's required appraisal form point by point, rattling off "grades" for each.
But Beer says this is the worst way to conduct an evaluation, as it does not open up a meeting for discussion.
"The most important thing is not the grade you're going to give the person and not the piece of paper you're trying to fill out for the company," he says. "Have that discussion be open, and enable that person to be able to be part of the problem-solving discussion."
You can make a meeting with your employee productive by putting the performance appraisal form away, or even leaving it blank until after the meeting's over. Instead, discuss not only how an employee has performed over the last few months or year, but also what dilemmas and problems that individual has faced—and how they handled them. From there, you can come up with ways the employee can improve and grow, and ideally walk away with a better understanding of why your employee fared the way he or she did.
4. Shift the review to the employee
One of the best ways to have a successful, open development discussion and review is to turn the tables and let the employee do the reviewing.
Falcone often tells managers they can better motivate employees by letting the employees assess their own work. He recommends giving employees these three questions to answer and bring to a review: 'How have you done?' 'What can I do as your supervisor to build your skills?' 'What will your goals be for the next year, and what are the measurable outcomes of these goals?'
About 70 percent of your employees will do fine with this assignment, and 10 percent may not even respond. However, Falcone says 20 percent will "go wild" with it and walk away very motivated. Generally these are a company's top performers and those you most want to engage in it.
Similarly, you can open up the session to productive discussion if you ask the employee to review a supervisor's performance as well as his or her own.
5. Come prepared
To credibly review an employee, Sharon Armstrong, author of The Essential Performance Review Handbook, says it is crucial to gather as many specific examples of good and bad behavior as possible and collect objective information on employee performance. This shouldn't be done right before a performance appraisal meeting; rather, achievements and slip-ups must be tracked throughout the year.
"The amount of specificity shows the employee that the manager was watching, noticing, and appreciating," Armstrong points out.
When it comes to the day of the review, Armstrong recommends creating an outline of discussion topics and laying down ground rules for a smooth conversation. After a meeting, be sure to follow up, summarize the discussion—and begin observations for the next review right away.