The air is brisk, “Jingle Bells” is playing in stores and hot cocoa is the beverage of choice. No, we’re not just talking about the holiday season—it’s also that time of year when companies are conducting employee annual reviews. As the new year approaches, many HR professionals look back at employee’s past performances before they look ahead. To help HR professionals navigate this specific review season it’s important to understand the best practices around performance evaluations, as well as what not to do.
An employee’s annual review is an opportunity for managers and employees to touch base on job performance. Usually, a performance evaluation takes place once a year and opens a dialogue between manager and employee to assess areas of improvement as well as areas of strength. Some reviews focus on professional development and career pathing while others may directly relate to compensation. There can be overlap between these two areas, but we’ll get to why you might want to avoid those kinds of dual conversations in a little bit.
While being on the receiving end of an annual review can be stressful, conducting a performance evaluation can also weigh heavily on the HR manager or director. How to Be Good at Performance Appraisals author Dick Grote describes the responsibility in the Harvard Business Review: “What a performance appraisal requires is for one person to stand in judgment of another. Deep down, it’s uncomfortable.” To establish a productive and amenable performance review process, try to avoid making these all-too-common mistakes.
1. Not giving enough notice
Whether you are delivering or receiving an employee annual review, preparation can benefit both parties. To have a truly productive conversation, a manager should set goals and expectations with an employee far in advance. This way, the employee can work towards defined objectives that they know will be assessed at the employee annual review.
These conversations should not come as a surprise, but more as a defined touchpoint that the employee can work towards. Touch base with the employee a few weeks prior to the review cycle and remind them of any goals that had been defined and encourage them to asses whether they have reached those goals or where they are in the process. You may even want to share a self-assessment form prior to the meeting to help prepare the employee for the conversation.
2. Winging the conversation
Consider creating an employee annual review formula for all employees. Establishing a standard for these types of conversations will not only help you feel more comfortable in the moment but ensure a fair performance review process across the board. Brush up on your own communication skills and enter into the discussion with clear talking points and takeaways for the employee. You may even want to draft a script that you can refer to while you are having these meetings. You might already have a scripted guide for layoffs or other tense HR scenarios, so refer to any existing documents for consistency’s sake and take the opportunity to add to your company’s resources.
3. Providing only one point of view
It’s important to represent more than one point of view in any employee annual review. It can be a good idea to include peer feedback as well as your own. An employee’s peers may have a better understanding of their professional skill set and may also be able to comment on the individual’s overall communication style. Further, having various sources of feedback that share similar points of view can help strengthen the specific evaluation. For example, if three team members share that the individual has exemplified great leadership skills the sentiment may have more weight compared to one person’s opinion.
4. Doing all of the talking
Remember that any employee annual review should be a conversation, not a presentation. Allow for the employee to have a voice as well and welcome their input. One way to do this is to start the review with their self-assessment. Try to think of it as sharing responsibility for the discussion—and then hopefully the employee will feel the same way and take more ownership throughout the process. They can come to the table with examples and new goals, which can be productive in the long run for everyone.
5. Covering too much
It can get confusing when both an employee’s development and compensation are grouped into the same conversation. It’s easy to fall into this trap throughout the employee annual review process. After all, many millennials feel that compensation that is based on performance and not tenure is an attractive quality in an employer, so it’s easy to see how development and monetary promotions could go hand in hand. However, while the two are linked, the areas do merit separate conversations. Allow for the review to really focus on the employee’s performance. Talk about how they have excelled and how they can improve. And then, once certain goals are met, the topic of compensation can surface.
6. Focusing on personality
When assessing an employee, keep feedback focused on professional merits. Try to avoid critiquing an employee’s personality traits and focus on ways to improve communication if there are issues with how they interact with others. For example, instead of saying something like, “Nobody wants to work with you,” you could say something like, “Some people have found collaborating with you to be a challenge.” Keep the critique related to the work and try to provide constructive feedback in place of character feedback.
7. Blindsiding with negative feedback
Ideally, an employee should not be taken by surprise by anything you discuss in their annual review. Real-time feedback should be given freely and will help manage expectations for the employee. Typically, the review should not be the first time the employee is delivered any specific criticism. Instead, any challenges that have been identified throughout their employment should be understood and well documented along the way. Real-life examples will only help ground the feedback, so use the opportunity to draw from these experiences to provide useful advice within the review cycle.
8. Providing feedback that is too vague
In an effort to cushion negative comments, it’s easy to speak around the issues instead of directly presenting them. However, this “sugar coating” approach could do more harm than good—for both the employee and the business. Keep feedback related to facts and examples and don’t try to soften or generalize the message. That being said, negative feedback does not have to be delivered in a harsh way. Aim to be productive by how you speak about the issue or issues. Instead of saying: “You always do X and never do Y,” try walking through examples of times they could have performed a task or communicated better. You could show how things were done and then constructively talk through how they could be done better in the future. Grounding your feedback will only strengthen your position and hopefully help the employee feel more receptive.
9. Not documenting the review or providing clear action items
Whether the discussion went perfectly or was a bit tense, it’s important to clearly document what was discussed within an employee annual review. The individual can use it as a reference for future compensation conversations and have it act as a guide for career development. Agree on next steps together and align on the individual’s tasks and goals for the weeks ahead. An email to recap action items and feedback can help mitigate confusion later on about what was said or agreed upon.
10. Communication ends with the review
An employee’s annual review should not be the first or last time you connect with an individual about their job performance. It’s important to keep up regular status updates. Check in to see how they are progressing with their professional goals. Talk about areas that were identified for improvement and encourage the employee to share how they are taking measures to grow. Be there to offer advice and real-time feedback.
Employee annual reviews should evoke productive, encouraging and candid conversations. Help employees understand what they can do to improve professionally and advance in their careers. This makes retaining your quality hires easier, especially millennials as this group particularly values career development. For more tips on how to retain millennials in the workplace, check out our article of suggested benefits and strategies based on millennial values.
