If you dread conducting employee evaluations, you’re not alone. As a small business owner or leader, you rely on your employees to play a significant role in your success and your employees depend on you for their livelihood. So when it comes to performance evaluations, all parties have a lot at stake, which can cause anxiety for everyone involved. This is why it’s important to standardize your process, making it simpler for you and easier on your team as they all know what to expect. 

One aspect of performance evaluations that managers often find most challenging is knowing how to measure performance fairly, accurately, and consistently across the board. Even if you have a general idea or feeling for how well or poorly an employee is doing, actually selecting a score along a range can be a stressful exercise. 

Whether you are facing the uncomfortable charge of telling someone they are not meeting expectations or the challenging task of keeping a high-performer motivated, the most effective performance reviews require careful consideration and proper planning. 

To help you prepare, download our free tool here — Performance Evaluations Scoring Quick Take

What Gets Measured Gets Managed

Although the review itself can’t do the heavy lifting of strong leadership, management, or coaching, it is an important document to recap performance over a particular timeframe. Keep in mind, what gets measured gets managed and keeping a running scorecard can be a powerful tool both in encouraging progress and making sound business decisions regarding disciplinary measures, promotions, and merit or bonus payouts.

Creating structure allows you to reinforce workplace expectations, and help your employees reach their full potential and your company reach greater goals. 

While it is important for employees to receive real-time feedback and immediate recognition, constructive engagement is meant to complement regular performance reviews, not replace them.

You may want to consider updating old school scoring methods, but that doesn’t mean you should toss out the entire annual or quarterly performance evaluation process.   

Reconsidering Performance Evaluation Ratings

Reconsidering how to rate employees isn’t just a matter of implementing a new performance evaluation tool based on a revised template or the latest scoring methodology. You will get the most from your performance evaluations if you shift your overall approach.

Instead of scoring based on meeting minimum job performance thresholds, you’ll get better results from setting the bar high. 

Meeting expectations shouldn’t be about doing the bare minimum, but about meeting elevated standards based on effective or exemplary performance. If doing the bare minimum earns an average rating, but it doesn’t meet the standards of what you really want from your employees, it can be confusing and demotivating — giving the a-okay to slackers and providing very little encouragement for employees that aren’t working towards their potential. 

We advise clients to go into the performance review prepared to provide examples that illustrate why you selected each score. 

When giving each rating, share your observations and as well as the data and documentation you collected to help you make your decision, and use verbiage pulled directly from your employee handbook and their job description. Keep your evaluation focused on their overall performance for the time period, and avoid letting other factors such as recent behavior, your general feelings about the employee, or comparison with other employees cloud your judgment or enter the conversation. 

The following are sample explanations for each evaluation rating/score that you can use:

4 Exceeds Expectations – Consistently superior performance throughout the appraisal period. Commendable performance, frequently exceeds expectations. Highly effective. Often goes beyond what is expected in the position. 

3 Meets Expectations – Meets all major job requirements and performs at a consistently effective level. 

2 Needs Improvement – Employee may be new in a role and is still developing or an individual may have been in their position and is not performing at an acceptable level. 

1 Unacceptable – Performance is at an unacceptable level of performance and requires immediate improvement.

As a leader, it’s your job to keep your employees energized, and a big part of that is setting goals and standards. Lower-achieving employees need to know that you aren’t going to consider subpar performance meeting expectations. Other team members will rely on you to provide direction on exactly how to make progress, and they need structure and guidelines to excel. High-performing, achievement-driven team members, may be self-motivated but they are also looking to you to provide constructive criticism so they can continuously improve. 

Overall, performance evaluations are an important management tool for any small business leader. It’s worth your time and effort to put a performance review process in place and continuously improve your process for the best possible results.

Does your organization need support with developing a customized performance appraisal and evaluation process? Contact us for one of the following solutions:

  • Schedule a Workshop (Available In-person or Online):
    • Designing a Performance Appraisal System that Works
    • Conducting Effective Performance Appraisals