If you believe research, we don’t need performance reviews to improve performance. Reviews seem to have no impact on individual performance. But hold off, before you jump and hit the delete button, read a bit further. Performance reviews serve another purpose. When they are done well, they improve retention. Performance reviews are a great opportunity to rerecruit your good performers and spend some quality time together talking about their future aspirations. So don’t stop doing reviews, just do them differently.
Performance reviews usually cause apprehension in employees and create hectic scurrying around for managers. For evaluation purposes, the review should be just a summary of the feedback the employee has already heard throughout the year. It should never include any surprises. It’s a good chance to look back and recognize the best accomplishments. It pays to focus on the positive. In a study on performance management approach, a strengths-based approach to management resulted in a 36% increase in performance, as contrasted with a 27% decrease associated with a weakness focus.
But hey, what do you do with low performers? You certainly shouldn’t wait until the review time to address their performance issues. If you use annual reviews to force your managers to deal with low performance once a year, you have a bigger problem than mind-numbing performance reviews.
As many companies use performance rating system that feeds into many other processes, such as rewards planning and succession planning, the performance review is a natural opportunity to be transparent about the implications of the performance rating and the employee’s standing in the talent pool. The manager’s job is easier if the rating process and its link to the other processes are objective and logical. Contact Forte Consulting if you need help with this.
The performance review should be forward looking. As you discuss the goals and results of the past year, probe for what the employee learned and wished they had known. When you give behavioral feedback, turn it into concrete development goals.
Many companies combine the performance review and the goal setting dialogue, as they easily flow together. As you plan next year’s goals together, look at them from a development perspective as well. What will your employee learn from each goal? Could there be an assignment that would be especially beneficial on their career path? What skill development and coaching will the employee need to be truly successful in accomplishing the goals?
Don’t miss the opportunity to ask questions about what keeps your employee engaged in your company. Ask about what makes them stay. Ask about obstacles. Talk about their long term career aspirations. Performance reviews just might turn into valuable dialogues that provide insight to both you and your employee.
Forte Consulting Blog 
I believe that if performance reviews are done well, they can be very powerful and constructive. I would always combine the goal setting and the reviews. I also appreciated your comment about being “forward looking.” This allows the review to be interactive and helps keep both the manager and the team member growing together. Thanks for sharing.
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