How To Conduct Employee Performance Appraisals (With Types)
By Dylan Buckley
Updated October 5, 2021 | Published May 8, 2019
Updated October 5, 2021
Published May 8, 2019
Dylan Buckley is a freelance writer based in California and the chief content/marketing officer of Furzly, a pet company he co-founded. He specializes in developing content for the cryptocurrency, mental health and business industries.
Performance reviews are crucial to the forward progress of both organizations and the employees who operate them. A well-executed employee performance appraisals system ensures that everyone has the tools to succeed at work. Well-conducted reviews can also improve team productivity and workplace satisfaction. In this article, we discuss what a performance appraisal is, what the different types of employee performance appraisals are and how you can conduct one of your own.
What are employee performance appraisals?
A performance appraisal, or performance review, is when a supervisor analyzes and summarizes an employee's work against expectations over a certain time period. The manager often compares the work to a standard baseline before documenting and discussing the results with the employee. These reviews are a great way to help employees better understand their performance and to set performance- or career-based goals to work toward.
These meetings function as an ongoing conversation between an employee and their manager, where the goal is for all parties to perform at or above the expectations set at the beginning of their employment. A few topics common in performance appraisals include career goals, performance rewards, improvement plans and suggestions for additional training.
For managers, performance reviews are an opportunity to:
Justify personnel changes, such as promotions, demotions and terminations
Identify and reward outstanding employees
Assist employees with improving their work
Establish a record of honest feedback
Practice improving their management
For employees, performance reviews are an opportunity to:
Receive an evaluation of their work
Learn their strengths and where they can improve
Understand the path to earning promotions
Provide insight into how they prefer to be managed
6 types of employee performance appraisals
There are several ways managers evaluate the performance of their employees. The type of review they choose to use plays a critical role in the outcome of the appraisals. When selecting the best approach, consider the specific needs of the workplace and the individual being reviewed. Some common performance reviews include:
1. Traditional performance appraisals
Traditionally, a manager and employee meet to review the employee's work performance every six months or annually. A preset rating system may guide the conversation. Often, a manager and employee work together to develop a plan on how to improve in certain categories. This plan becomes a benchmark for success during the next review.
There are no set limits on the performance review cycle. Instead, managers may prefer setting specific deadlines for different employees. For example, with an employee who's worked at a company for decades and requires little direction, a meeting every six months or once a year may be sufficient. Meanwhile, newer employees may require monthly appraisals to help them stay on track.
In a self-appraisal, employees assess their own performance before meeting with their manager. This process establishes a framework for discussion and allows employees to prepare for the meeting. It also helps managers get a sense of how team members view their own performance, job description and goals. With both the manager's appraisal and employee's appraisal, both parties can get a better idea of what may need to change to improve the employee's performance.
3. Employee-initiated reviews
With an employee-initiated review system, employees request a review from their manager when they deem it necessary. Allowing employees to initiate reviews, rather than having a set review period, empowers them to take responsibility for their professional development. This system may also help promote communication between supervisors and their teams.
Employees who are less outgoing may find this self-starting system challenging. Working with them to support a successful start can provide the foundation they need to get motivated and excited about their work. Then, they may be more likely to initiate discussions and regular appraisals to monitor their progress.
Related: How To Empower Yourself and Others
4. 360 feedback
A 360 appraisal seeks feedback from many sources, including a self-review from the employee and feedback from supervisors, coworkers in the same or adjacent departments and customers. This appraisal style ensures that an employee receives comprehensive feedback about their performance. To maintain positive workplace relationships and minimize potential conflict, companies may allow anonymous reviews.
5. Group performance appraisal
A group performance appraisal addresses the work of an entire team, rather than an individual employee. This method is ideal in workplaces where groups collaborate on work, so companies may prefer starting the appraisal process after a team has completed a project. Collective appraisals also allow the group to reflect on how they can better work together. For those departments that rely heavily on group productivity and carefully monitor collective data, group performance appraisals are an invaluable tool for team growth.
6. Upward appraisal
An upward appraisal occurs when employees review their supervisors. These meetings allow managers to improve communication and relationships with their teams. Conducting upward appraisals can contribute to a collaborative, equal work environment. Topics for an upward appraisal include the manager's leadership skills and their ability to provide thoughtful feedback regularly. For managers looking to advance their careers, upward appraisals can help them gain valuable insight into their professional progress.
Read more: Setting Goals To Improve Your Career
How to conduct employee performance appraisals
It's essential to know how to conduct employee reviews to ensure success. Regardless of which approach you take, here are five steps to help appraisals run smoothly:
1. Prepare your feedback in advance
Thoughtful feedback is important. Carefully considering your review and how you plan to present it to your employee can help the meeting stay focused and professional. Before you sit down with each individual employee or team, draft extensive notes and talking points and prepare documents your employees can keep for personal reference.
2. Give employees time to prepare
Provide employees with relevant appraisal information, such as what these meetings are, what they discuss and how you complete evaluations. Encourage employees to think about the review so they're prepared to speak with you. If your employees complete self-appraisals, you may wish to create a document with all the grading criteria for their review. This gives you a resource to compare your own performance review to theirs during the meeting.
3. Provide documentation
Give your employee a written copy of your review's key points, such as a written evaluation form. This allows them to remain engaged during the meeting, rather than taking notes and can help them reflect on your points afterward. If possible, provide blank copies to your employees during the onboarding process. Knowing what they're being evaluated on ahead of time makes it possible for them to develop these qualities before their first employee review.
4. Ensure the meeting is a dialogue
While providing comprehensive feedback is necessary, it's also valuable to give employees a chance to ask questions and to ask some questions yourself. Consider asking how they perceive their own performance, how you can support them in meeting their goals or where they believe they've made the most progress since their last review. Appraisals are the perfect time to touch on any concerns or obstacles they may be facing.
These meetings are an opportunity to improve your employees' work ethic and performance. But how employees feel about working with your company ultimately determines their output. So, consider appraisals as a chance to enhance workplace culture and the internal systems and processes that support your company.
5. Close with a focus on the employee's future
There may be challenging aspects of an employee performance appraisal, such as delivering criticism or disappointing news. So it's a good idea to end the meeting positively. Convey that you're invested in providing guidance and ensuring that employees reach their professional career goals. This kind of assurance can make negative feedback easier on both sides.
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