Are you gearing up for annual employee reviews? And are you dreading it? If you’ve answered “yes” to these questions, know you are not alone. A 2018 WorldatWork survey shows 94% of companies conduct formal employee reviews annually – and a separate study suggests we hate them. 95% of managers surveyed are dissatisfied are with the process and nearly 90% of HR executives feel results are inaccurate. A Gallup survey shows only 14% of employees feel performance reviews inspire them to improve. So, if it’s so awful, should we just chuck the review process all together? No. Although there is frustration on all sides of the current traditional process, employees who have had a review in the past year are more engaged in their work than employees who haven’t. Surprisingly, 82% of employees say they value receiving feedback (positive and negative) with 65% of employees wanting more feedback. So rather than abandoning performance reviews entirely, here are the three ways to elevate your culture and your business by simply fixing what’s broken with our current approach to employee reviews.
1. Increase the frequency.
Seems counterintuitive right? Managers, HR professionals, and employees dread them, so do them MORE? Much of what seems to be broken is that we are only talking about performance once per year. A Gallup poll shows only 15% of employees working for a manager who does not meet with them regularly are engaged. Consider this, what if you set an intention on January 1st to lose 15 pounds by December 31st? Then, come the morning of December 31st you weigh yourself – for the first time since setting the intention nearly a year earlier and you instead gained five pounds. How would you feel? How would it have been different had you known in September that you were further away from your goal that in January? You could’ve chosen to do something about it – but now that you waited the entire year, you’ve really painted yourself into a corner of disappointment. Waiting to talk about employee performance is the same. No one works their butts off only to have it all come crashing down when it’s too late. Frequent, less formal reviews, often referred to as check-ins, allow employees some time for course correction and leaders the opportunity to evaluate employee goals and performance as needs of the business change. Check-ins also allow for more trust to be established between employees and managers. Social psychology identifies two types of trust, cognitive – trust based on what you know about someone, and affective – trust based on emotional connection and closeness. It’s through frequent interaction with another that we develop affective trust in another – so long as both parties act in a trustworthy way of course.
Recently there has been a lot of talk, and some significant research on what makes a good boss. Top traits include being a good coach, helping employees achieve their professional goals, and caring about employee success & well-being. A Harvard study of 3,200 employees found employees describing their culture as caring, had higher levels of satisfaction and teamwork, less absenteeism, and better company performance. What this means from an employee appraisal or check-in standpoint is – performance discussions should serve as a time to either support or recognize an employee depending on how that employee is doing. Performance reviews – whether formal or informal – are not simply a time to report back performance data. If an employee isn’t performing, work with the employee to identify why he/she is struggling – and how to fix it! If an employee is performing above expectations, recognize the employee for a job well done. Get to know about what is important to employees – what they love and dislike about their work. Caring about employee success will not only make for more valuable reviews and check-ins but also make for a more open and honest relationship. What managers did you have that cared about your happiness and success? How did you choose to show up for them each day? Our employees are no different. Start each employee check-in by asking how they are doing. Did they recently go on vacation? Is his son graduating high school? Did she get a new car? Did she have a big sale? Is it his busy time of year? Start each check-in building rapport, reinforcing you care. “I know you are wanting to spend every minute with your son before he heads off to college, so let’s talk about what you have on your plate and make sure we’re streamlining everything as much as possible to get you out early on Fridays.” Empathizing with the employee and offering support to get work done in a way that benefits you both is highly effective.
3. Collaborate on goals
The happiest and most valuable employees are the employees that understand how their work translates to company success. They get it. Without this understanding, an employee’s manager is no longer a manager but a babysitter or a person that barks orders. But leaders are responsible for exposing employees to this mindset, by explaining company initiatives and describing how the employee’s work aligns to those initiatives. For this reason, effective employee reviews happen when employees and managers collaborate on employee goals. With a basic understanding of what the company aims to achieve for the month, quarter, year, or whatever timeframe, encourage employees to create their own goals for the period. Aside from helping employees get more engaged in the business, there are also some psychological benefits. Research shows that when we create our own goals, the emotional and strategic parts of the brain work together to plan for and envision the goal, turning our attention away from less productive thoughts and events that aren’t aligned to our goals. When an employee then creates his or her own goal that a leader then reviews and/or tweaks, the employee is more emotionally and mentally committed to the goal that if we as leaders were to just prescribe them goals. When we encourage employees to create specific challenging goals, studies show these difficult goals will actually lead to higher performance than easy goals (such as “do your best), or no goals at all. Because mindset is critical to achieving any goal – regardless of it being personal or professional, this step is key to making a valuable performance discussion.
Like any interaction with employees, it’s more valuable to both parties when it’s an exchange, not one-way feedback. Historically, performance appraisals were one-way discussions in which a manager advises each employee of how well or poorly he/she performed over the year. Is it any wonder we all dread this process? By implementing these three simple strategies in your performance management process, you solve for a healthier and more effective feedback loop in which leaders work with employees to achieve success. More successful companies start with more successful people and feedback paves the way.