A manager’s guide to constructive employee performance reviews - Advise Accountants
24 January 2016
A manager’s guide to constructive employee performance reviews

Effective and supportive management is a key ingredient in making sure your employees love their jobs. And one of the most important aspects of being a good manager is giving clear feedback to your team members. This is something you should be doing consistently throughout the year. But yearly performance reviews are the perfect opportunity to reflect holistically on what went well and what could use some work. Here are some tips for how to conduct constructive and effective yearly performance reviews.

Think through the timing of performance reviews

Many companies choose to do yearly performance reviews in January (to cover the previous year). Whatever date you set, make sure to give your employees as much notice as possible. That way they can come to the meeting prepared to discuss what’s on their mind. If you’d like to structure this preparation more formally, you can ask your employees to write self evaluations as part of the review. And if it makes sense for your business, you may also want to ask the team to give feedback on each other. If you elect to do peer reviews, be sure to state clearly how they’ll be conducted (especially whether they’ll be anonymous).

No big surprises

As we mentioned, a good manager gives feedback on employees’ performance regularly. They let them know where they’re knocking it out of the park and where there’s room for improvement. So their yearly performance reviews shouldn’t be all that surprising. Ideally, employees should be working toward their SMART goals. That mean Specific, Measurable, Achievable, Realistic, and Time-bound. That way, if someone is consistently missing their targets, they won’t be surprised to hear they haven’t met expectations. And if someone’s been promised a raise, they’ll get it.

Adequately prepare

It’s not just employees who should prepare for their yearly performance reviews. It’s just as important for managers as well. They should come to the review having done a thoughtful analysis of their employees’ performance throughout the year. Collect all notes that will be relevant — including employees’ self reviews, peer reviews, and any data points that illustrate how things have been going. Square’s analytics tools, for example, provide a wealth of information that could be useful here. Especially things like sales data by employee. Organize all your thoughts into a document that you can print out and bring to the review. It also gives your employees something to take with them if they’d like to reference it in the future.

Structure the meeting

To make sure everything is as productive as possible (and that you don’t go off track), you’ll want to have a clear picture of the meeting’s flow. To keep the conversation focused, go into each review with a few key takeaways. As the meeting kicks off, set the agenda. For example, you could say something like, “We’re going to talk through four key areas: your past performance, your current performance, your peer reviews, and your 2016 goals.” Remember, the review should never be a one-sided discussion, so pause after each section for questions. You should also leave some time at the end dedicated to anything else on people’s minds. Both you and your employee should leave the meeting on the same page, with a clear path forward. Your staff needs to feel like they’re getting something out of the meeting. You should also have an actionable plan for you both to follow.

Reward top performers

To keep everyone motivated, you need to recognize your top performers for a job well done. This will also ensure you don’t lose top talent to competitors. The obvious way to do this is with a bonus or a raise, but if that’s not in the current budget, there are other options. Perhaps you promote them to manage some people themselves. Or promise a raise in three to six months if business does well. (This strategy has the added benefit of giving employees an incentive to work extra-hard to grow the business.) Another way to show appreciation is by offering to foot the bill for additional certifications or training.

The long and short of it is that a structured yearly check-in is crucial to keeping your team on track and motivated. These tips will go a long way towards setting your team (and business) up for success in the coming year.