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Small Business Employee Benefits and HR Blog

The #1 Way to Conduct Performance Reviews

March 23, 2015

Everyone can relate to that time of year when you are evaluated on how you’re doing at work - the Best_way_pefromance_reviewsperformance review. And to be frank, neither you nor your employees enjoy them. Which makes you wonder, is there a way to conduct performance reviews in a positive, non-intrusive manner? Yes.

This article provides you with the number 1 way to review your employees without ruffling feathers, and how it can lead to negative competition and teamwork.

Why Your Employees Hate Performance Reviews

Before you were a small business owner, do you remember the feeling of annual performance reviews? You probably didn’t like them much. And statistically, 60 percent to 90 percent of employees dislike evaluations.

Why?

For lack of a better word, they’re archaic. For years, they’ve been done the same way with little variation and producing the same outcome - upset or annoyed employees.

The truth is, traditional performance reviews cause dysfunctional internal competition and deter teamwork. This is the kind of competition where your employees will do whatever it takes to get a good evaluation in order to get a raise. Thus, performance reviews conducted this  archaic way can be disadvantageous to your small business.

The solution? Ongoing performance reviews.

The #1 Way to Conduct Performance Reviews

What is an ongoing performance review? It’s the complete opposite of a yearly performance review. Ongoing performance reviews are, exactly how they sound. Rather than measuring how your employees are doing once a year, you do it throughout the year multiple times through casual conversation.

The result? You’ll have more genuine conversations with your employees, lower attrition, and decreased negative competition.

But how do you conduct an ongoing performance review? Really, it isn’t complicated. Set a goal to speak to each of your employees a certain amount of times per year. You can say once or twice a month, or even weekly. What matters is that you’re doing it.

Keep track of the times you talk to your employees and what you talk about. This way, you can fix any little problems along the way. Your employees don’t necessarily have to know it’s a review when you talk, just make it a conversation. Allow your employees to talk about what they’re liking and disliking and you can add your advice to help them be a better employee.

This approach is extremely unintrusive, and actually helps you build a strong relationship with your employees. They will feel you care about their day-to-day activities and success. Your employees will want to stay with your company.

Related: Want the Best Company Culture? Focus on Communication

Teamwork and Ongoing Performance Reviews

Ongoing performance reviews have many advantages, but the most prominent is that they are conducive to teamwork. How? Let’s think of it this way and put yourself in the shoes of your employees.

If you walked in to work every day knowing that the only way you’re going to get a raise is if you have a perfect score on your yearly performance review, what would you do to ensure your increase in salary?

Would you take credit for your co-workers’ ideas and projects or even lie? Hopefully not. But the truth is, many employees do this because they think that only a small percentage of their co-workers will be getting a raise.

It’s too dog-eat-dog.

Ongoing performance reviews help take competition out of the equation. How? Your employees understand that raises are not based on the biggest projects you’ve done in the year, but rather on the little things you’re doing every day. Your employees stop focusing on trying to climb over each other and start seeing the bigger picture - teamwork.

Small Business 101 - Managing Employee Performance

Conclusion

Performance reviews can be your best friend or your worst enemy. However, choosing to favor ongoing performance reviews over the archaic practice of yearly performance reviews may be the way to help your small business become more unified and effective.

Do you think ongoing performance reviews would be beneficial to your small business? Why or why not? Let’s start a discussion by commenting below.

Related

Who Needs Performance Reviews? You Do

Why Employee Development is Important to the Culture of a Company

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