Best Practices for Performance Reviews with Examples You Should Steal

December 4, 2023
Best Practices for Performance Reviews with Examples

There’s a lot to consider during a performance review, so we’ve made things a bit simpler by compiling some of our best practices along with examples- as well as some advice on why you might consider changing your current performance review if it’s built in a traditional manner.

5 Reasons to Ditch the Traditional Performance Review

Data continues to show that traditional performance reviews aren’t cutting it.

Update your performance management processes and boost retention and productivity

If there’s one thing that employees and managers dread, it’s the performance review.

In a traditional performance review, there is typically a formal meeting that takes place once or twice a year. You sit down with your employee and evaluate their strengths, weaknesses, and tell them your expectations for the next year — with a quick question for feedback at the end.

But the reality is, this format doesn’t work. Employees actually love getting constructive feedback and recognition, not just from their managers, but from peers and clients as well. And they’d prefer to get it more often. In fact, switching up your performance review process can help you boost retention and productivity.

Keep reading to learn why you should ditch the traditional performance review and what you should do instead.

The verdict is in: traditional performance reviews don’t work

Study after study has proven that the traditional performance review is a relic that needs to be kicked to the curb. These formal reviews typically focus on the employee’s progress and are intended to set expectations going forward. But more often than not, they came too little, too late.

There are several reasons why these reviews just don’t work. Here are our top 5:

Reason 1: 95% of companies hire the wrong people every year

At first glance, recruiting and performance reviews don’t appear connected. But in reality, if you don’t know your workforce and their day-to-day challenges, how can you effectively find the right hires to fill the gaps? Or evaluate those new hires effectively?

Traditional performance reviews make it easy for miscommunication and assumptions to slip into the recruiting process. And if you wait 9 to 12 months to check in with your new employee, you run the risk of missing critical issues that affect motivation and retention.

Reason 2: Focusing on weaknesses reduces productivity by 27%

In a traditional performance review, managers tend to overemphasis weaknesses, with the hope that employees will focus on improvement during the next year. But study after study has shown that extensively covering an employee’s weak points will cause an overall drop in productivity.

In fact, switching it up and focusing on an employee’s strengths can boost productivity by 8.9% and reduce turnover rates by over 14%.

Reason 3: Too many employees are forced to wait too long for feedback

Formal reviews generally happen once or twice a year. Or if you’re lucky, once a quarter. Over 30% of employees have to wait 3 months or more under the traditional structure — even when 96% of employees agree that regular check-ins are beneficial.

Waiting too long to give a performance review can demotivate employees while allowing common errors to go unnoticed. And waiting months to check-in can have the employee looking elsewhere for recognition.

Reason 4: Most employees and managers believe that a lack of communication is the root cause of failure

In addition to traditional performance reviews being rare, they can cause massive gaps in communication. Since a traditional review typically uses a hierarchical relationship between the manager and employee, these discussions usually end up revolving around the employee’s strengths and weaknesses.

But expectations and environmental challenges are often glossed over if discussed at all. This can impede or stop success in its tracks, while a more collaborative approach might have resolved these issues.

Reason 5: 1 in 4 workers admit that they will leave a job if their performance reviews are subpar

Employees, whether they are struggling or not, do want to be recognized for their hard work. Without regular access to both positive feedback and constructive criticism, it’s likely that an employee will begin to feel more like a cog in the machine than part of a team.

And most traditional reviews are likely to turn off employees. As we discussed earlier, these reviews are too rare to be effective, with inadequate content.

You would be better off finding an alternative system that can regularly motivate employees.

What’s the alternative?

If we were to summarize everything wrong with performance reviews, they would be that the formal structure has issues with timing, content, and communication. Generally, traditional reviews happen too rarely to be effective, the content is often one-sided, and overall there the lack of communication between employees and managers causes a breakdown later on.

The good news is that there are alternatives to the formal performance review. Instead of sitting your employees down for a general meeting once a year, you can use:

Regular one-on-one meetings

Either once a month or once a quarter, take each employee aside for a one-to-one meeting. This can be a collaboration to highlight current challenges and successes, or a way to better understand how you can help your employee reach the next level. One-on-one meetings are an excellent way to build rapport, trust, and communication with your individual employees.

Weekly check-ins

Why not take 20 minutes once a week to check in with your employees or your small team? You can even bring in other subtle ways of recognizing employees, such as anonymous peer review comments or other forms of interaction.

Whatever you choose to do during your weekly session, the goal is to make sure employees know that your door is open.

Goal tracking

While a bit more impersonal, take time to go over results with your employee. Not only will this keep both you and your employees focused on meeting objectives, but you can find ways to address their weaknesses in a productive manner.

Peer reviews

Ask your team to anonymously rate each other’s performance. While these reviews can be taken with a grain of salt, they can also help you pinpoint challenges your team is facing.

Ask your employees to review the managers

Managers need just as much feedback as any other employee. Getting feedback from the team about management can help you learn what they need to feel more supported.

In addition to these tips, you can improve the quality and quantity of feedback by removing the link between performance reviews and raises, and through adopting digital approaches to collect employee responses.

4 Reasons to Acknowledge Employees Between Performance Reviews

A happy employee is an effective one, and employee appreciation is an essential part of building an effective workforce.

Here's what you need to know:

  • Employees who feel recognized for their work are more likely to put in more effort and work harder so they get recognized again
  • The way you treat employees translates to how they handle customers
  • Employees who don’t feel recognized are twice as likely to want to quit in the following year
  • Employees tend to be more present when they are reminded of how important they are to their organization
  • Employees are probably the most important cog in the wheel of your company. And without the oil of appreciation, that cog is likely to jam up eventually. Most of your workers are eager to hear you tell them that they are doing good work.

Traditionally, performance reviews offered the opportunity for bosses to comment on an employee’s work. However, performance reviews often come across as more of an exam than a time for encouragement — and they come too infrequently. Employees want to feel appreciated on a day-to-day basis. Here are a few reasons why you should oblige them and what you can do to show appreciation.

Why employee acknowledgment matters

Employee acknowledgment is fundamental to getting the best out of your workforce. Employees will feel more connected to their work, their team, and your company as a whole if they are valued and rewarded for their particular efforts.

Here are a few reasons employees should be acknowledged.

Employees are more productive

Employee acknowledgment is a low-cost, high-impact method of boosting productivity. Employees who feel recognized for their work are more likely to put in more effort and work harder so they get recognized again. Research from Deloitte shows that employee productivity and engagement is 14% higher in organizations that practice acknowledgment.

Customer satisfaction levels are higher

When you notice and praise the efforts of employees, they feel cared for and begin to see themselves as part of the company. That confidence translates to how they handle customers — which paves the way toward higher customer satisfaction levels. According to a 2019 paper from the International Journal of Business and Management Invention, there is a direct and positive relationship between employee satisfaction and customer satisfaction. And one of the main factors improving employee satisfaction is recognition.

Employee turnover drops

When you recognize and reward your employees’ efforts, they will feel valued and want to continue working with you. According to Gallup, employees who don’t feel recognized are twice as likely to want to quit in the following year.

Stress and absenteeism levels are lower

Employees tend to take less sick leave or days off when they are reminded of how important they are to their organization. Gallup research shows that if businesses double the number of employees they recognize every week, there will be a 27% reduction in absenteeism.

Ways to acknowledge employees

It’s hard to overstate the importance of recognizing your workers for a job well done. Here are a few ways to do it outside the normal performance review.

Consistently praise and recognize your employees

Humans are naturally drawn to appreciative people. You need to get them used to the mindset that when they do good work, they’ll be recognized for it, whether there’s a performance review or not. Say “thank you.” Recognize their accomplishments orally, in writing, or publicly, and look for new ways to express your gratitude regularly.

Offer rewards for a job well done

Beyond their salaries, find ways to offer your employees incentives when they perform their tasks well. Learning opportunities, project awards, prizes, bonuses, and other perks are all examples of incentives. Keep in mind that recognition, not the exact reward or incentive, is the motivator. All incentives should be given equitably.

Send them an employee care package

Never doubt the power of care packages, especially when it comes as a surprise. Regularly reward your employees with care packages containing items that demonstrate your care, such as handwritten letters, gift certificates, healthy snacks, games, and other rewards.

All of these products, carefully chosen and thoughtfully arranged, have a greater impact than any single gift. This not only demonstrates that you care about your employees but also shows that you know who they are.

Invest in their health

The COVID-19 pandemic has underlined the importance of good health and healthcare. Healthy employees are efficient employees. That’s why they need tools that will assist them in establishing a strong foundation of wellness. According to a 2020 workplace wellness poll, 70% of employees believe they require assistance from their employers in order to stay healthy. Top-tier healthcare is not cheap, and neither is quality health insurance. Investing in your employees’ health is a sure way of acknowledging them and showing them that you are interested in their well-being.

Buy them lunch

Who doesn’t love free food? Buying someone a meal is one of the most effective ways of showing appreciation. While sharing a meal, make sure to show your gratitude for a job well done. You can even plan a group remote lunch with virtual gift cards for your team if you have staff working from home or in several places. Simply send the gift cards, schedule the lunch, and then video in together for a meal.

Find ways to make tasks fun and enjoyable

As important as pay is for employee satisfaction, you don’t want employees who don’t enjoy what they do. If needed, find ways to spice it up by creating incentives for performing tasks or even setting up healthy competition. This can help in team building and bonding. No task should be boring. Everyone should enjoy what they do and understand that their roles are important in the grand scheme of things.

Do a company-wide shout-out

There’s nothing like seeing your name in a tweet or a page-long letter stating how awesome you are and what a great job you do. A genuine shout-out to everyone is a free, simple, and effective way to thank employees. It expresses appreciation for everyone even while highlighting the efforts of some specific people. This makes all your employees feel included in your recognition without envying the highlighted employees.

The bottom line

The need to be recognized for our efforts, whether at work or anywhere else, is a basic human sentiment. We want to be appreciated. And when we get this appreciation, we want to work even harder. Understanding this as a business owner or a manager is key to building a secure, motivated workforce. Tell your employees when they’ve done a good job. It’ll go a long way in making them more effective.

Performance Review Examples You Should Steal

There are plenty of performance review examples you can use, but how do you know which one is the best for your team?

Take the guesswork out of performance reviews

Here's what you need to know:

  • Try to make performance reviews as comfortable as possible for your employee
  • Having your employees do a self evaluation may be beneficial
  • 360-degree reviews allow peers to review each other

If you’ve ever tried just Googling “performance reviews,” you might have been surprised about the number of results. So many come up! There are literally hundreds — if not thousands — of performance review examples on the internet.

If you’re looking to put together a formal performance review process for the first time or are looking to take a new people operations approach to reviews, the options can be overwhelming to say the least. That’s why we’ve chosen three of the best performance review examples that you should steal.

The best part? Nothing is set in stone! You can take what you like and leave what you don’t. You can absolutely copy these performance review examples word for word if you’d like. But you can also customize them to your liking as well. It’s all about discovering what works for you.

If nothing else, consider these three examples as jumping off points for making your own, unique performance preview process.

Tips for conducting performance reviews

No matter what kind of performance review you choose to go with, there are a few tips and tricks that make any review process more effective.

Make it comfortable

First, make the process and the environment that surrounds it as comfortable as possible. Everyone knows how anxiety-inducing and just generally uncomfortable performance reviews can be. So do what you can to minimize the anxiety so that people can focus on what matters: continuing what they’re doing well and work to improve on the areas where they can grow.

The key to a comfortable environment is to make it more like a conversation than a one-way communication from manager to team member. Of course, managers are generally leading the process, but it should feel collaborative. Consider doing reviews outside of the office to minimize work interruptions.

Avoid tying everything to punitive measures

Finally, avoid tying the processes to punitive measures. If anything serious comes up, an adequate response is necessary even if that includes punitive measures. But outside of the extreme, make it a common and casual exchange.

We all have strengths and weaknesses. Make sure that it’s clear that the review process is exactly that — a review that’s designed to help you improve. Do not make it a berating session that covers all the places a person falls short. Then, of course, make sure that the process is carried out this way as well so that it’s not just lip service.

The basic performance review example

Especially if you’re just getting started with performance reviews at your small business, it can often be best to start simple.

Performance reviews don’t have to be overly lengthy or complicated. It’s often more about the process and the clarity and structure it provides than anything else. Performance reviews are also an opportunity to learn where managers or the company is failing its employees, so consider asking questions like:

  • How would you rate the team’s performance this (year, quarter, etc.)?
  • What are you most proud of accomplishing and why?
  • Which goals did you meet? Which ones did you fall short on? Why?
  • Do you feel supported in your role? How can that support be improved or supplemented?
  • What are your ideal working conditions that allow you to be the most productive?
  • What helps you do your job effectively?
  • Which parts of your job do you like best and least? Why?
  • What are two or three things that you want to focus on this (year, quarter, etc.)?

You’ve probably noticed that there are a bunch of “why” questions in here. The key is to not just get answers but get insight that can help employees progress and managers better support them.

The self-evaluation performance review example

Another way to approach performance reviews is to take a self-evaluation approach. With this method, the employee essentially reviews themselves by responding to first person questions. Then managers and employees go over the answers and talk through them together.

If you want to go the self-evaluation route, some of the questions you can consider asking include:

  • What achievement or goal am I most proud of?
  • What was a challenge I faced that I handled well?
  • Which projects did I enjoy most?
  • Which part of my job is my favorite?
  • Which projects did I enjoy least?
  • Which part of my job is my least favorite?
  • What goals or areas did I fall short in?
  • What areas am I weakest in?
  • How can I improve in those areas?
  • Where do I want to be in the company next year?
  • Where do I want to be in the company in the next five years?

The 360-degree performance review example

Tons of companies use the popular 360–degree method for performance reviews. In the 360-degree method, employees select roughly three to five other people they’ve worked without throughout the review period to review them. Typically, employees also review themselves as well.

When putting a 360-degree review together for external reviewers, consider asking yes or no questions along with a why/how element like:

  • This person effectively prioritizes their time and meets deadlines.
  • This person exhibits leadership skills.
  • This person has strong interpersonal skills.
  • This person provides fair and actionable feedback.
  • This person embodies our company value of X.
  • What are this person’s biggest strengths?
  • What are this person’s biggest weaknesses?
  • What are 4 words that you’d use to describe this person?
  • Where would you like to see this person improve?
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