At its core, an employee review is a formal means of communication between a manager and employee.
This evaluation typically covers employee performance over a set period of time (annually, biannually, etc.), and gives the manager the opportunity to provide feedback while setting ongoing objectives.
But, despite the fact that workplaces are more engaging and open than ever before, most employees still hate performance reviews.
In this article, we’ll cover how to give a performance review that employees will love, and we’ll also equip you with the tips, tools, and templates you need to succeed.
Let’s do it.
How to give a performance review
Why everyone hates performance appraisals and reviews
While it might not seem obvious at first, almost everyone involved in the feedback and performance review process doesn’t enjoy it.
That includes the managers who deliver feedback. In one study, only 8% of companies found that performance management processes actually drive high levels of value while 58% said that employee evaluations weren’t an effective use of time.
But why is that? Let’s take a look at some of the more common complaints that employees have about performance reviews.
When delivering effective reviews and evaluations, keep in mind that the are the main obstacles you’re trying to overcome.
Reason 1. Biased rating systems
One of the biggest gripes in the evaluation process is a lack of impartiality.
And don’t get us wrong: we understand. Everyone is human, and everyone has a bias. And there are a lot of biases out there.
However, any perceived bias can dilute the effectiveness of a review. This is due in no small part to the fact that managers are left to interpret the metrics and data and draw conclusions based on anecdotal evidence.
You might remember what someone did five months ago when they landed a big sale for the company, but it’s easy for performance in more recent months to be overshadowed by that major event.
The problem for team members is that those biases can complicate performance reviews. What makes it worse is when people underestimate how their opinions are affected by their own biases.
And bias can materialize in many forms. Sometimes, it’s something as simple as a gender bias. Other times, it might be a bias toward leniency that makes employees feel like they aren’t being judged on the same merits as their (underperforming) coworkers.
However it happens, when bias gets involved, annual performance reviews begin to feel unfair and performance feedback becomes less effective.
Reason 2. Impersonal delivery
A lack of familiarity with the individual delivering the performance review can be a poison pill for the review process.
If the first time you’re seeing an employee is when they sit down with you for a performance discussion, they’ll be less likely to accept your feedback and evaluation.
Employees need face-to-face time with individuals who have worked alongside them and have a clear understanding of their goals, strengths, and weaknesses.
That typically means that managers should deliver feedback to direct reports who have worked with them. When upper-level leadership interferes with that process, the result can be confusion and lack of understanding — especially when priorities are different at varying levels of management.
Reason 3. Performance / pay relationship
Tying performance and pay together as part of an annual review is a common tactic. Unfortunately, it’s a major problem that can lead to a vicious cycle of underperformance and underdevelopment.
This is especially true in metrics-related roles like sales, where employees may not have total control over the customers they receive or the buying mood of the industry.
Coupling performance and pay also disincentivizes employees from taking risks, overperforming, or doing anything outside the scope of a job description.
And, realistically, who can blame them?
Many organizations search for workers who can problem-solve their way out of major issues only to cap their wage increases based on arbitrary performance reviews.
Couple that with the fact that about half of human resources professionals already believe the review process is inaccurate and it’s a recipe for disaster!
Not only does this drastically affect employee engagement; it also encourages employees to set goals that, while acceptable, may not take into account the big picture goals that the company seeks to solve.
Reason 4. Poor managerial communication
Communication skills are essential when delivering effective performance reviews.
Managers who lack these skills won’t be able to deliver the constructive feedback that an employee needs in order to improve their performance.
Especially when workers are struggling to meet minimum company standards, a lack of effective communication can lead to action plans that feel punitive and unjustified.
This ultimately leads to retention issues as employees seek new job opportunities.
The COVID-19 pandemic has made this worse, in many ways.
According to one survey, a third of respondents said that communication has become more of a challenge in recent months while 26% said that the way businesses communicate has also deteriorated in the last year (2021).
Reason 5. Lack of goal setting
In a perfect scenario, the close of a review period is a time for a company and an employee to reevaluate performance results and set goals for the next interval.
When managers can’t deliver clear expectations for the road ahead, it’s difficult for employees to know what they should do next.
A lack of clear goals won’t help employees succeed and, often, they will leave a review meeting more confused about their own performance than they were when they started.
And this happens across all spectrums of performance. If a high performer doesn’t have anything to work toward, that lack of clarity can result in roadblocks to advancement or promotion.
For low performers, it can lead to an action plan or an unpleasant follow-up about metrics and results.
What you can do to create an effective performance review
Now that we’ve covered some of the most common gripes about complaints surrounding the performance review process, let’s take a closer look at how to fix them.
Effective performance reviews involve a healthy mix of preparation, problem-solving, and real-time assessment derived from in-the-moment feedback with the employee.
When done correctly, a performance review can realign the employee’s goals and get them back on track.
Here’s how to do it.
1. Make it personal
Right now, only about 36% of employees are actively engaged with the company they work for. The rest are either actively engaged against the company (internal detractors) or are disengaged and not interested in their relationship with the organization.
Having a manager who cares can change all of that, but making performance reviews personal is more complicated than it seems.
That’s because creating a close relationship with a worker takes time and effort that is often outside of the scope of a direct report relationship.
Personalizing a performance review requires check-ins and follow-ups with workers, a constant and regular evaluation of an employee’s job performance, and much more. Often, senior management doesn’t have time to do this for indirect reports.
This is made even more difficult in modern working environments, where trust in employers is at an all-time low. If employees lack trust in you or if they doubt your motives for helping them succeed, they won’t be inclined to accept the results of their performance appraisal and use that feedback to advance.
The solution to building trust is hands-on leadership rather than backseat management.
Work with your direct reports to accomplish good work. Celebrate wins. Recognize them when they excel. Give quick and immediate feedback often when you see an opportunity to improve.
Show them that you’re in their corner and that you have their best interests at heart.
2. Deliver feedback throughout the year
Multiple studies have found that annual reviews are some of the least effective performance review schedules.
Overall, more frequent reviews are seen as more accurate, which can help to boost legitimacy while providing additional opportunities to sit down and evaluate an employee’s work performance.
This also makes it much easier to correct issues in a formal capacity. With quarterly check-ins and reviews, you can catch problems and evaluate issues on a more frequent timetable.
If this isn’t available within your organization, finding a way to create unofficial meetings and follow-ups may be the best way forward.
For many workers, it can be easy to lose focus on everyday tasks. Make some time to meet with your direct reports constantly throughout the year and use the opportunity to keep their mind on the bigger picture.
3. Prepare with specific examples
When you’re delivering feedback to direct reports, coming prepared with specific examples is one of the best ways to let your workers know that you’re paying attention to their needs.
The easiest way to create specific examples is to make careful notes that highlight a worker’s wins and opportunities for improvement.
This should be done over time, in the intervals between check-ins, follow-ups, and formal performance reviews so that you always have relevant examples to use to build rapport.
You may also need to come to the meeting with additional metrics to back up your examples. This is especially true for sales-based roles or customer service roles, where customer tracking and satisfaction are key elements to success.
Some tools can help with that, including customer feedback and NPS scores.
You might also use something like the document analytics provided through a software tool like PandaDoc to see how many documents were sent, whether they were successful, and what kind of story that tells about employee performance.
This also helps when creating formal evaluations and written assessments because it gives you a wealth of information to draw from in order to create your performance review.
4. Have clear goals in mind
It’s been proven that defining clear goals and having some measure of accountability are major factors in whether or not those goals are achieved.
In one study, goals were most commonly achieved when written down, disclosed to a friend, or when progress reports were a regular part of the performance process. With that in mind, it’s no wonder that regular check-ins have a major impact on performance management.
You might also need to introduce tools that help workers accomplish those goals and become more effective. Workplace automation is key to eliminating employee burnout and giving workers room to grow.
But before you can check-in and follow up with your direct reports, you need to set goals. Before you start a performance review, make sure that you have clear outcomes in mind — both for the meeting and for the employee.
5. Listen and respond
Employee feedback is critical for performance reviews.
When sitting down with an employee, keep an open mind and be ready to respond to their grievances and concerns. If there were obstacles that impeded progress since their last review, consider those challenges and how best to address them moving forward.
Remember: no matter how closely you work with your employee, their perception of their own performance (as well as the problems that inhibited progress) may be vastly different from your own observations.
Conduct this communication in a two-way fashion. Give employees time to answer questions, and be prepared to work with them in order to create effective outcomes that can lead to positive assessments in the future.
Also, keep in mind that some problems may be internal. With COVID-19, even something as simple as collaboration with the rest of the team can be a problem if workers don’t enjoy working remotely.
Tools that can help you improve
As we discussed in the previous section, taking the time to prepare can go a long way toward legitimizing the performance review process.
Fortunately, you can increase the chances that the assessment will go well by using tools to gather information and prepare. Below, you’ll find a list of tools designed to help you succeed when delivering employee performance reviews.
1. Notes and relevant examples
We mentioned this one earlier, but it bears repeating. Conducting a performance appraisal with specific examples and notes compiled over time (ideally since the last assessment) is one of the best ways to prepare for an evaluation.
When you begin working through review documentation, being able to draw on a series of wins and accomplishments for each of your direct reports will help you view the sum of their contribution as a whole over time.
Metrics and data points can help to provide a more holistic view of an employee’s performance, but notes help you eliminate bias and prevent you from being forced to work solely from memory when assessing output over a specific term.
2. Performance review templates
Templates are a quick and easy turnkey option that can help you compile reviews much faster.
Most major organizations have internal templates that allow managers to compile key employee details quickly and easily. If you’re part of a smaller- to medium-sized organization, you may lack the tools to create consistent reviews for every employee or direct report.
Template tools, like our Employee Evaluation Form or our Employee Performance Review Template, allow you to generate the same type of documentation quickly and easily so that you spend less time designing documents and more time compiling feedback that makes your assessment worthwhile.
3. Employee self-evaluations
Giving employees the opportunity to review and evaluate themselves is also key when it comes to creating positive performance reviews.
As a manager, a self-assessment from an employee will give you insight into what your direct reports think about themselves and their own performance.
Incorporate this preemptive feedback early and use it to create effective annual performance reviews. Ensure that the wins and losses that employees interpret for themselves align with the goals and objectives of the organization.
Workers who are too focused on arbitrary issues or secondary objectives can quickly transition from exceptional employees to poor performers in key areas of business.
Many of these issues will show up in an employee’s own interpretation of their roles and responsibilities.
If these issues materialize in a self-evaluation, make sure to help them get back on track by creating goals and objectives that are both realistic and consistent with the brand.
4. Peer feedback tools
Often underutilized, peer feedback is essential for increasing the authenticity of a performance review. In fact, the very best review systems combine peer feedback with an increased frequency for added legitimacy.
Peer review feedback should be gathered from users who often work most closely with an individual. Depending on your evaluation style and the nature of your work, it may make the most sense to summarize this feedback and deliver it in a fair and impartial manner.
While honest feedback is valuable, be sure to deliver it in a way that avoids drama and an airing of grievances among everyone involved.
Keep in mind that, while you’re sourcing feedback from coworkers close to the employee, this may be a tight-knit group within your organization.
Any review, no matter how thorough, should avoid creating friction between team members.
Tips for conducting the review
Now that you’re familiar with the common complaints and some of the best approaches to resolve those issues, let’s talk about some best practices for conducting performance reviews.
Keep in mind that, often, employees are nervous about performance appraisals and may not know what to expect.
Fortunately, there are steps you can take to put employees at ease and take the sting out of the performance review process.
1. Find a neutral location
While gathering everyone in an office probably seems like the most direct and straightforward way to conduct a performance assessment, this setting is rarely considered neutral.
In many organizations, especially if employees don’t have an office or dedicated workspace of their own, a manager’s office can feel strange and uncomfortable — anything but truly neutral.
If you’re looking to ease tensions and put employees at ease, shared community spaces are often the best bet. A board or meeting room is an easy alternative. If your organization is connected to a green space, like a park or an exterior garden, taking the conversation outdoors may also be an option.
Whichever location you choose, make sure that it’s quiet and relatively private. Choosing to review performance in the middle of a busy food court or in quiet but popular spaces can make employees hesitate to accept and provide feedback.
The same is true for virtual meetings. While you may not be able to control an employee’s virtual surroundings, you might want to consider creating a virtual meeting room where you can share and view documents together.
2. Set aside the appropriate amount of time
Performance reviews take time, and it’s very easy for managers to set half-hour intervals for reviews with a plan to wrap everything up by the end of the workday.
But a rushed performance review is likely to set workers on edge and leave them feeling undervalued.
While time is money and reviews can’t take forever, be sure to give your team members the time they need to evaluate your feedback and ask follow-up questions.
While this is especially critical for poor performers, it’s easy to sideline legitimate concerns from top performers as well.
If your employee needs help understanding the results of their assessment, don’t rush them out the door. Assist them with understanding the issue so that they leave with a clear understanding of what they should do next.
3. Be prepared to listen
In many ways, feedback during the performance management process is a two-way street.
Employees may have reasons why they haven’t accomplished their goals. They may have feedback on what you could do to help them succeed. Even top performers may have advice or feedback on culture, employee engagement, and company objectives.
While it’s true the primary focus should be on the employee’s goals for the next cycle, taking the time to listen and understand your employees is critical to the long-term success of your team.
4. Take good notes for later
Any performance review is the start of a new cycle for your direct reports.
Whether you review their performance on a quarterly, biannual, or annual basis, take the opportunity to compile a review that you can use to benchmark progress at the end of the next cycle.
Creating good notes at these inflection points will give you a strong baseline for progress made between cycles.
Many managers rely on metrics as a benchmark for performance, and this can be a dangerous practice. Softer skills, like people management, team cohesion, and a drive for results are factors that can’t be easily quantified and may be critical to your team.
Take good notes as part of your interview process. Tell employees what you’re doing and that you plan to revisit these issues during the next evaluation cycle to see how things have improved.
Those notes can then become your objectives on your own managerial task list for the next cycle.
5. Offer effective feedback
It can’t be overstated: effective and clear communication is essential for great performance reviews.
When delivering a performance review, be ready to offer direct and actionable feedback that employees can incorporate into their workflow.
For example, if your employee is struggling with time management, feedback about keeping an eye on the clock probably isn’t actionable. Instead, you’d need to find out why their time management skills are so poor.
Are they getting bogged down during a specific business process? Are they overloaded with work? Do they have conflicting priorities?
Once you know the answer, you can help them create a solution to resolve this issue. In this scenario, effective feedback and problem-solving might result in troubleshooting the problem and gathering information before proceeding.
However, if you don’t provide guidance and leave employees to resolve these issues themselves, they’re likely to struggle. In many cases, employees know about these problems and haven’t found a way to resolve them on their own.
As a manager, you can help them succeed by taking the time to work out these issues, offer the next steps, and provide lasting feedback.
Improve performance evaluations with PandaDoc
No performance review is complete without paperwork. But creating performance reviews completely from scratch for every single employee can become a huge time sink.
But whether you need to create a customized template for performance assessments that can be duplicated across your entire organization or a self-evaluation form for every employee, PandaDoc can help.
Plus, all documents created with PandaDoc are stored on our secure servers, so they’ll always be available whenever you need them.
Sign up for a free 14-day trial with PandaDoc and learn how our powerful document tools can shave hours off of your review process.