It's performance review season, which always comes with some challenges. Performance appraisals may not be the most popular HR process, but they're necessary and, when done well, help improve performance and retain top performers.
But you have to give effective performance reviews if you want to keep your top talent and motivate your workforce.
Here are a few common things that can cause your company to lose your best players during performance review time and a few new things to be aware of so you don’t conduct a bad performance review.
Characteristics of Bad Performance Reviews:
Make advancement as vague as possible. There is nothing more frustrating than wanting to get somewhere and not finding a way to get there. Employees expect (and deserve) to hear what you envision for their future and share their hopes for their own careers. Avoiding this — or worse, not preparing for it at all — will frustrate you both and set the stage for a negative performance review. Give your driven employees a roadmap to follow, and you will find a much higher retention rate. Performance review best practices include showing employees how their goals align with the company's goals.
Focus on all the negative feedback you’ve been saving up. We understand—you want work to be done at work, not play. But ultimately, allowing your employees some fun at work will keep them committed to their work and the company vision. One of the biggest complaints about performance reviews is that they focus on the more immediate and negative issues and leave employees feeling unappreciated. Talk about no fun. According to a 2019 study from Gallup, only about 10% of U.S. workers felt engaged after receiving negative feedback on the job. Nearly 30% were so put off by a bad performance review that they began actively looking for a new job. Happy, healthy employees that enjoy coming to work are much less inclined to have "wandering eyes."
Performance Review Tip: No one thinks performance reviews are fun, but scheduling less stressful activities during this stressful time may help ease the pressure. No amount of company parties will make up for not having any positive feedback to offer. If you don’t have anything positive to say, well...
Tolerate poor performers and underachievers. Nothing annoys an A Player more than seeing someone who underperforms given the same recognition they are given. Although many managers feel the stress of increased workloads, tolerating underachievers can burn your employees out and make your job harder. As soon as you see disengagement surfacing in your company, address it. If you don't, you will lose good employees, making the burden on the remaining employees all the more difficult.
Performance reviews sometimes reveal frustrations employees are having with colleagues around them. Pay attention to common themes or players and have a great performance management system in place to address them. According to Deloitte, organizations with solid performance management systems in place perform 92 times better financially than low-performing PM organizations.
Performance Review Tip: While it’s important to ensure your employees are all being fairly judged on their performance, it is recommended NOT to discuss other employees’ performance management during the review unless that person is the employee’s direct supervisor.
Ignore and gloss over great performance. “Yeah, Jim—I really have no idea what you're doing, but keep doing it.” Phrases like that are rarely conducive to employee engagement. Bad performance reviews make your employees feel replaceable and unimportant and can disincentivize them to do great work. At the moment, everyone at your company is probably working twice as hard as they were last year. And it has never been more important than now to recognize outstanding talent and great performance. Specific recognition incentivizes excellent work and makes driven employees more driven to achieve. Start ignoring greatness, and you stop generating it.
Performance Review Tip: Great performance reviews require specifics. If you’re less than knowledgeable about someone’s role or their daily performance, ask their colleagues, look at company intranets, discuss with their supervisor or team lead, and go through older performance appraisals to discern how they’re doing.
Don’t ask how things are going outside of work. Too often, no one slows down to ask how employees feel about their job, performance, company policies, or even life in general. It might seem superfluous to ask right now since many of us may feel stuck, but it’s still important to ask.#DYK? Bad performance reviews can drive your top talent to quit. Don't lose your top performers:
Beyond simply getting a sense of what matters to your employees and what’s going on in their lives, you can also use this to inform your review. Was Grace an A-player for three years and in the last six months become distracted and difficult to work with? Knowing that Grace is now homeschooling three kids under the age of 12 and her partner is essential medical personnel may just give that assessment some context.
Performance Review Tip: If you add in some personal questions about how employees are managing or their life outside of work, make sure you outline the questions properly and ask them of every employee. Singling out one or a few employees to ask could raise concerns about preferential treatment.
Make it as dull and rote as possible. Performance reviews (especially annual performance reviews) are difficult, and if you are administering them, they may seem repetitive. However, you and your employees will benefit from making each performance review informational, constructive, and worth the time and effort. According to a TriNet study on performance reviews, 22% of full-time U.S. employees surveyed said they’ve called in sick because they were anxious about receiving their reviews.
Performance Review Tip: Coach your managers (and remind yourself) that performance reviews, while exhausting and all-encompassing to you, are important and kind of a big deal to your employees. They want to feel valued and focused on. Schedule your reviews so you can refresh your coffee, take a walk, and have some downtime in between.
According to a survey conducted by Mercer, only 2% of companies believe their performance management process delivers “exceptional value.” Less than 3% find their feedback practices to be excellent and said there should be a stronger link between performance management and other talent considerations. If you continue to practice the no-nos above, you will be in that 97-98% of companies who don’t value performance reviews or performance management. But it doesn’t have to be that way.
An amazing performance review season is possible. Aligning employees with company goals can be done. And building A Players through great performance management is what we do here at ClearCompany. Want even more great performance review resources? Check out our Performance Review Bundle.
ClearCompany’s Performance, Engagement, and Goals platform enables you to seamlessly design, automate, and manage any type of performance review:
- New Hire Reviews (30, 60, 90-Day Reviews)
- Quarterly, Bi-Annual, or Annual Performance Reviews
- Competency and Roles-Based Reviews
- Time-Based Reviews
- Peer and 360 Reviews
Want a faster route to your best performance review season yet? Talk to one of our experienced consultants about a tour of ClearCompany’s Performance, Engagement, and Goals Platform.