Great Performance Review

How to Run a Great Performance Review

Here we explore How to Run a Performance Review effectively, along with some great tips, examples and templates.

3/10/2021 Management & Leadership Performance Management

Overview

So you're a founder, small HR team or manager looking for a refresher on running an effective employee performance review. We're going to look at:

  • Designing the process
  • Building Your Performance Review Template
  • Performance Review Examples
  • Running the Review
  • Giving Great Performance Review Comments and Feedback
  • Tips for an Effective Performance Review

The main complaint about this process from managers and executives is that it simply takes too much time. This hurts everyone's commitment to the process and thus its return. So bear this in mind as you layout the process and communicate. How can you save time?

First Steps

Before actually sending your reviews to questionnaires or scheduling meetings, it's best to make some key decisions.

Firstly, decide on your timelines. This will have to factor the general workload of the organisation, requirements from your executives, and salary increases timing.

Secondly, decide on who is involved in the reviews. Will it just be the manager? The manager and the reviewee? The manager, reviewee and some peers? Feedback from more people around the reviewee is better but it costs more time so don't go crazy here. Aim for 2-6 reviewers per reviewee.

Thirdly, decide on the deliverables. What is produced by the process and who gets to see it? If there is a low level of trust, candour, and/or maturity then consider letting the manager get the feedback from the reviewers and summarising it for the reviewee. Over time, as you build trust and maturity in your organisation, you can share anonymous feedback directly with the reviewee. In fully mature organisations, the reviewee could even see exactly who said what.

If this is your first time running a performance review process at your organisation, we recommend you start light and build out your process with each round. Factor in that your managers need to learn the process as well and this takes time and several rounds.

Building your Performance Review Template

Now comes the time to work out exactly what feedback you're going to ask for from your reviewers. Decide on how to structure the review and what data you need to collect.

Your options for each question:

  • Simple open-ended
    • Do you think they are a good leader?
    • Answer in less than 300 words.
  • Simple Rating
    • Do you think they are a good leader?
    • Score between 1 and 10.
  • Custom Rating
    • Do you think they are a good leader?
    • 1 = Very Poor
    • 2 = Below Expectations
    • 3 = Meets Expectations
    • 4 = Above Expectations
    • 5 = Rockstar
  • Multiple Choice
    • What leadership skill could they improve on most?
    • Active Listening
    • Strategy
    • Coaching
  • Multiple Select
    • Which of the following values do they show? (pick 2)
    • Integrity
    • Proactivity
    • Learning

Performance Review Examples

A simple process to get started is to run a simple 360 with the Start, Stop, Continue template. Select the peers that have worked with the reviewee the most and have them complete this template. I.e. A direct report, a peer on the same level, the manager, and the reviewee does a self-review. The manager then reviews all of the feedback, perhaps gives the reviewee a rating and then gives feedback to the reviewee.

The Start, Stop, Continue template asks 3 simple questions:

What should the reviewee start doing?

What should the reviewee stop doing?

What should the reviewee continue doing?

Another great template is the G.O.O.D template which is ideal for manager and self-reviews.

Goals

  • What long-term goals have we agreed to?
  • How have things gone since we last spoke?
  • What are our plans until next time?

Obstacles

  • What’s standing in your way?
  • What have I noticed getting in your way?
  • What can I do to help? What can you do?

Opportunities

  • What are you proud of that people don’t know about?
  • Do you feel you’re growing toward where you want to be?
  • What could we do to make this your dream job?

Decisions

  • What actions will you take before next time?
  • What actions will I take before next time?
  • What other big decisions did we make?

Running the Process

The most important thing to do here is COMMUNICATION. Everyone in the organisation needs to know what the timelines are, who must do that, what documents they must complete and where to send them once complete.

Also, remember to be sparing on people's time. Your employees are busy so save them time where you can. An easy place to do so is on your Performance Review kick-off email. Be succinct, include helpful links and docs and include a simple FAQ at the bottom or link to one.

It is very common for one or two team members to miss their deadlines. Keep chasing them with reminders so that the whole process doesn't fall behind.

Giving Great Performance Review Comments and Feedback

Giving constructive feedback that drives personal growth or corrects behaviour is the main objective here. This is where the real value of the process is shown so if you're not seeing it, consider reading some books on giving great feedback like Crucial Conversations or Difficult Conversations.

Here are some examples of giving positive feedback

  • “You effectively manage your team and conduct specific exercises to strengthen the team.”
  • “You acknowledge accomplishments and recognise employees fairly.”
  • “You are spoken highly of by your peers because of your ability to build good relationships.”
  • “You are adept at communicating difficult messages and decisions skilfully.”
  • “You are a great team player. Your team members respect and appreciate you.”
  • “You always meet your deadlines and make the best use of your time.”

Here are some examples of giving constructive feedback when an employee needs improvement

  • “You can’t explain the goals and objectives of a task clearly to an employee.”
  • “You get frustrated with new hires easily and don’t coach them properly.”
  • “You need improvement in replying to emails promptly.”
  • “You interrupt others in discussions and important meetings.”
  • “You try to use your seniority to dominate your team members.”
  • “You have started delivering low quality work just to finish your work on time.”

Tips for an Effective Performance Review

No surprises

The most important thing to get right in performance reviews is avoiding surprises. This means that the employee should have a good understanding of what's expected from them throughout the year and already know how they've been doing in that regard.

They might be in sales and have to make $10,000 in new sales each quarter with a dashboard showing their current progress. That way they know whether they've been doing well or poorly in that regard before they even hit the performance review.

This is important because the nerves are always high during these meetings. Nobody likes to feel judged. If they know beforehand then they can prepare better for the conversation and thus get more out of it.

No Feedback Sandwiches

A common but poor technique to use is the feedback sandwich: compliments, criticism and then more niceties. This just sends a mixed and vague message.

If they are doing things well, then tell them. If they are not doing well then you are doing them a disservice by holding back or obscuring the message in niceties. Tough feedback is not fun to give but it has to be done for them to improve. Convey the message, hear from them, and then help them set goals or plans to overcome the performance issue. This will build trust and allow for more candid conversations going forward.

Be a coach

Your job as a manager is to develop talent. Start by treating them as mature adults and asking for their honest concerns. Once you're both aligned on the feedback from the review and their concerns, you can start setting goals and addressing behaviours.

It's important to be specific when addressing behaviour. Don't say vague things like "You need to take more initiative". Instead, say things like "You need to take more initiative in calling potential sales leads".

This is not a good time to discuss compensation

It's very tempting to have a single meeting to discuss review feedback, a rating and the compensation impact all in one meeting with an employee. This causes a big problem in that the employee will only focus on the compensation part of the meeting. Who wouldn't? It has such a big impact on your life.

Instead, have two meetings. The first should be a development meeting where you only discuss review feedback and handle goal setting. The second can happen a couple of weeks later and tackle the compensation impact along with related questions. This will allow employee development to be prioritised.


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WRITTEN BY
JP Olivier
Co-Founder of Roslin, chartered accountant, self-taught coder, entrepreneur and investor. JP loves working with technology and is passionate about good management and leadership. He is active on Linkedin and Twitter.