5 Tips for Conducting Effective Performance Reviews

An engaged workplace, where employees are stimulated and motivated, is proven to lead to greater business success with higher profitability and productivity, lower absenteeism, lower staff turnover and even higher customer loyalty. One of the key ways of encouraging employee engagement is to offer feedback and support through a structured performance review process.

It’s important to fully understand and appreciate the benefits of an effective performance review process because the advantages can be so powerful. When managers are successfully driving and participating in the performance review process, this encourages greater outcomes for both your organisation and the individuals within it. Benefits can include:

• The opportunity to clearly establish performance expectations with workers
• Gaining insights into employee satisfaction, professional goals and challenges
• Allowing for discussion around areas of improvement and development
• Providing an avenue to express gratitude toward the employee’s performance and value within the organisation.

Whether your workplace currently conducts performance reviews or is considering implementing the process, here are 5 tips on conducting performance reviews effectively:

Ensure the frequency of the reviews is established from the outset. Gartner research indicates that the provision of regular, ongoing feedback can see up to 12% increases in employee performance. How often reviews are conducted will depend upon the needs and goals of your organisation and could occur annually, every six months or as frequently as each quarter.

Communicate with managers and employees so they know what to expect from the process, and how they can prepare for the review. In turn, ensure that you arrive to the review with well thought-out feedback that’s supported by specific examples to enhance your advice.

Stay focused on the period of review – for example the last six months – and park any issues that have already been addressed in previous reviews. If the issue has arisen again, ensure you’re raising it with relevant and recent examples.

A performance review is the ideal time to be looking forward as well as back, as it helps each employee to know their objectives and place within the organisation’s wider mission. When establishing goals for the future, ensure they are SMART – Specific, Measurable, Achievable, Realistic and Time Specific. For best outcomes, involve the employee in establishing goals so that they are invested in achieving them.

Avoid the use of the ‘compliment sandwich’: that is, placing negative feedback in between positive feedback. When using this method there is the risk of losing the true message, as people are more inclined to focus on the positive aspects which can impact improvement areas. Instead, give feedback such as, “I would like to see improvement in your processing times. Talk me through your current process when performing this task.” Then, offer suggestions on how to improve to meet your expectations.

• Structure is crucial to an effective performance review, and it’s important to:
• Open each review with an agenda
  The agenda may be established and shared before the review, which will provide an opportunity for the employee to contribute anything they would like to discuss. An agenda will also assist in keeping the review focused, on track and on time.
• Finalise by confirming further actions to be taken by each party
  Confirm with the employee what the next actions are for each of you. Specifically, repeat any new goals that have been established, new opportunities that have been proposed and any incentives, rewards or pay increases.
• Document everything discussed and agreed upon thoroughly
  Keeping thorough and accurate records assists in keeping parties accountable in the future and keeping future decisions well informed.

You might currently be on the lookout for the right support in designing, implementing or improving the performance review process within your workplace. Contact the experienced team at performHR today on 1300 406 005, and learn how our expert outsourced HR support and services in Melbourne, Sydney, Brisbane and around Australia can help to optimise your human resource strategy.