Top Performance Review Tips for Managers and Employees

General

When executed effectively, performance reviews can be transformative for both employees and organisations. According to a study by Randstad Malaysia, people mostly consider giving and receiving feedback as a positive thing, as it helps them have a clear understanding of what they need to achieve and how to do it (69%), makes them feel more motivated (52%), and supports learning and development (49%).

However, the performance review process can encounter challenges such as bias, ineffective feedback, and a lack of preparation. A significant number of employees remain uncertain about how to react during these evaluations, leading to missed opportunities for growth and development. This article aims to help managers and employees alike overcome these challenges.

At a Glance:

  • Understanding the Essence: Grasping the purpose and process of performance reviews is crucial for both parties.
  • Frequency Matters: Tailoring the frequency of reviews can address both short-term and long-term objectives.
  • Preparation is Key: Both managers and employees benefit from thorough preparation, ensuring a productive dialogue and effective performance reviews.
  • Two-Way Conversations: Encouraging open communication fosters a positive work environment and mutual growth.
  • Setting Clear Goals: Establishing SMART objectives paves the way for continuous improvements and future successes.

What is a Performance Review?

A performance review, often termed as performance appraisal, is a systematic evaluation of an employee's job performance, strengths and weaknesses, and overall contributions to the organisation. The primary purpose of performance review is to provide constructive feedback, set future goals, and discuss avenues for professional development. It is also an integral part of human resources management. 

There are many types of performance reviews including negotiated appraisal, Management by Objectives (MBO), peer review or 360 feedback, and more. Central to this process are Key Performance Indicators (KPIs), which are measurable values that demonstrate how effectively an employee is achieving key business objectives. By aligning individual KPIs with organisational goals, companies ensure that every team member stays on track, contributing to the broader mission.

Why is a Performance Review Important?

Performance reviews serve multiple functions:

For Employees:

  • Clarity & Direction

Get a clear picture of expectations, progress, and areas for development.

  • Motivation & Recognition 

Acknowledgement of achievements as well as performance that exceeds expectations, and opportunities for advancement boost morale and engagement.

  • Development Opportunities

Identify opportunities for training and skill-building, paving the way for career growth.

For Teams/Organisations:

  • Improved Performance 

Clearly defined KPIs and regular feedback lead to a more focused and productive workforce.

  • Talent Development

Valuable insights from performance appraisals help identify high-potential employees and guide their development.

  • Increased Retention

Engaged employees with clear growth paths are more likely to stay. Thus, effective employee engagement is important for retention. 

  • Strategic Alignment

Performance appraisal and employees’ feedback provide information that allows KPI analysis and ensures they align with organisational goals.

How Often Should a Performance Review Take Place?

The frequency of performance reviews varies across organisations, tailored to specific objectives and cultures. Some utilise annual reviews, while others opt for a combination of quarterly check-ins and a yearly review. 

The key is to establish a regular cadence that allows for ongoing feedback and goal tracking to fit your objectives. For instance, while weekly performance appraisals might address immediate problem-solving skills, the annual performance review evaluates overall performance, considering both strengths and weaknesses over an extended period. The performance review frequency can be:

  • Weekly

Often in the form of 1:1 feedback sessions or team meetings, focusing on day-to-day tasks, meeting deadlines, and immediate challenges.

  • Monthly

Provides a platform to discuss short-term goals, track progress, and address any areas for improvement.

  • Quarterly/Biannual

This type of report delves deeper into overarching objectives, assessing performance, and goal-setting for the upcoming period.

  • Annual

A comprehensive evaluation of the year's performance, often influencing decisions related to promotions, bonuses, and future career paths.

6 Performance Review Tips for Managers

Set the Stage for Success: Preparation is key.

TIP 1: Establish Clear Objectives

Prior to the review, collaborate with the employee to define measurable and achievable goals (SMART goals). These goals should align with individual strengths, departmental objectives, and the organisation's overall strategy.

TIP 2: Leverage Performance Review Templates

Utilise templates to streamline the process and ensure consistency across reviews. These templates should include sections for strengths and weaknesses, goal progress, and future development plans.

Foster a Two-Way Conversation: Embrace active listening.

TIP 3: Use the STAR Method

Structure your feedback using the STAR method (Situation, Task, Action, Result). This ensures clear, specific examples that illustrate both strengths and areas for improvement. For an in-depth look at phrases to use and questions a manager can ask during a performance review, check out our article here.

TIP 4: Actively Listen & Encourage Employee Input

Give your employee ample opportunity to express their perspective, concerns, and aspirations. Active listening fosters trust and creates a space for constructive dialogue. Avoid bias and stay on track by focusing on objective data and measurable performance metrics.

Set Clear Expectations for Future Success: Collaboration comes first.

TIP 5: Set SMART Goals

Working collaboratively with the employee, refine goals or set new ones for the coming review period. Remember, goals should be specific, measurable, attainable, relevant, and time-bound.

TIP 6: Develop Action Plans

Create a concrete action plan with specific steps employees can take to achieve their goals. Recognise their strengths and opportunities to improve their skill sets. If an employee fails to meet expectations, provide them with a plan to course correct. This plan should include resources available, development opportunities, additional training if necessary, and timelines.

6 Performance Review Tips for Employees

Self-Assess & Prepare for the Conversation

TIP 1: Prepare a Self-Evaluation & Gather Evidence

Take ownership of your development by creating a self-evaluation report. Be honest with yourself about areas where you can grow. Then collect examples of your work that demonstrate your skills and contributions. This could include projects, client feedback, or data-driven results.

TIP 2: Anticipate Questions

Consider potential questions your manager might ask and prepare thoughtful responses. This will help you feel more confident and prepared.

Communicate Effectively

TIP 3: Speak Up

Share your thoughts and perspectives openly and honestly. This creates a collaborative environment and helps build trust with your manager. Ensure your goals are aligned with the company's overall strategy. 

TIP 4: Listen & Seek Clarity

Pay close attention to your manager's feedback and ask clarifying questions when needed. Ask your manager for additional guidance and resources to help you achieve your goals. This shows your initiative and willingness to take ownership of your career.

Leverage Feedback for Growth

TIP 5: Be Receptive

Embrace feedback as an opportunity for improvement. Focus on the constructive aspects and avoid becoming defensive.

TIP 6: Create an Action Plan 

Develop a plan with your manager to address areas for improvement and track your progress. This demonstrates your commitment to personal and professional development.

Performance Reviews: Key to Employee, Manager & Company Success

Performance reviews are not merely compliance exercises; they are strategic investments in employee development and organisational success. By following these tips, both managers and employees can transform performance reviews into meaningful conversations that drive growth, engagement, and high performance.

Remember, the goal is to create a culture of continuous learning and improvement where feedback is welcomed, goals are aligned, and employees feel valued and supported.