How Can You Improve the Effectiveness of Performance Reviews?

How Can You Improve the Effectiveness of Performance Reviews?

Seeking to transform performance reviews into catalysts for genuine growth, we've gathered nine pieces of advice from top HR executives and business leaders. From fostering clear, frequent communication to developing success with ongoing check-ins, these insights from CHROs and CEOs are designed to guide you through effective performance evaluations that drive improvement.

• Foster Clear, Frequent Communication
• Design Values-Based Review Tools
• Embrace Feedback During Reviews
• Conduct Regular, Documented Conversations
• Align Reviews with Job Expectations
• Prevent Surprises in Performance Reviews
• Set Specific Goals and Provide Coaching
• Incorporate Team Support in Reviews
• Develop Success with Ongoing Check-Ins

Foster Clear, Frequent Communication

Clear is kind. Unclear is unkind. Frequent conversations with team members about their performance are the key to effective performance management. Coaching skills are lacking in the supervisor ranks; they are untrained. Being clear about expectations, being clear about resources and mentoring available, and following through with frequent touchpoints with employees not only ensures better performance but also creates connections and relationships that are essential for psychological safety. This allows people to step forward and admit what they don’t know and what they want to learn.

Design Values-Based Review Tools

Designing an effective tool is the first step, not so much in the functions of the job but also in incorporating the values of the organization. It is not just how well the employee exhibits their competence, but how they live and breathe the values that sets them apart from the low performers.

Understanding the strengths and areas needing improvement of your employees is critical. By focusing on their strengths, you gain support and positive engagement, which is critical in healthcare. The results of a performance review should never be a surprise to any employee. For example, they may think they have been a stellar performer all year. Then the leader shares disappointment in their work and behavior; however, they have never shared this with the employee. Rather, the leader should have multiple conversations with the employee throughout the year so that when it is time for the performance review, they understand the areas for improvement and buy into making those improvements.

Leaders should give the employee three compliments to one area needing improvement. This is a proven practice which I have carried throughout my career. If the leader shares positive behaviors throughout the review, the areas for improvement will resonate with the employee and therefore have positive outcomes. Reinforcement of the organization's values will lead to exceptional customer service, which is the basis for any organization.

Embrace Feedback During Reviews

One strategy that I prefer to use when conducting effective performance reviews is being open to the feedback of the person that I am reviewing. As a leader, we tend to give formal feedback only once a year, and that often leads us to do an incomplete assessment of the employee's performance. Through listening to their feedback and sometimes making adjustments to the review based on that feedback, it has created buy-in from the employee on the improvements that I am requiring them to make. This leads the employee to trust me as a leader, believing that the feedback I am providing them will lead to greater performance by the employee.

Conduct Regular, Documented Conversations

Effective Performance Reviews should not be a once-a-year conversation. Managers should conduct continual, documented conversations throughout the year with each of their employees. These discussions should be back-and-forth, candid, open, and not one-sided. The year-end discussion should then be a synopsis of the conversations that occurred during the previous 12-month period. If at the year-end discussion the employee is surprised by their results, the manager has failed their employee.

Align Reviews with Job Expectations

The best way to improve the efficacy of performance reviews is to align them with clearly defined expectations of the job. I see too many reviews focused on general strengths and weaknesses, which leads to less relevant, tangible, and actionable feedback. When reviews outline the expectations of the job first, and then ask managers to assess performance against those expectations, employees receive clear and relevant feedback about what's most important to their success.

Additionally, research shows that performance reviews linked to a set of clearly defined criteria are more fair and objective. In open-ended performance reviews, men tend to receive more feedback about their results, while women receive more feedback about their style. By holding everyone accountable to a clear set of expectations, feedback about both results and style (or 'the what and the how') is shared equally.

To be effective, performance reviews should always be anchored on what is expected. This keeps the bar for success clear and unmoving and helps employees make actual progress based on the feedback shared.

Prevent Surprises in Performance Reviews

An employee should be made aware of their poor performance long before their performance review; it should not be a surprise. Performance reviews are just a review of the progress an employee has made and where they are or need to be.

Set Specific Goals and Provide Coaching

Focus reviews on specific goals and metrics. Tell employees exactly which key performance indicators (KPIs) you want them to improve and have them track progress regularly. For example, I set targets for my customer service team around response times and satisfaction scores. I review their performance monthly and provide coaching to help them achieve their goals.

Tie these targets to company objectives. Explain how their role drives overall success. For my company, faster response times mean higher customer retention and more referrals. Sharing this big-picture view motivates employees by showing how they contribute.

Offer honest yet constructive feedback. Praise what’s working and suggest practical ways to improve. Express belief in their ability to grow. This positivity inspires motivation and loyalty. My team knows I support them fully, so they feel empowered to try new strategies and push themselves outside their comfort zone.

Incorporate Team Support in Reviews

Ask employees to regularly share where they are stuck or need assistance to reach their goals and objectives. Often, limited capacity can be addressed by bringing in another team member to support a certain aspect of a project or task for a limited time. By regularly adding this question to all performance reviews, the manager will begin to see connected opportunities for improvement across the organizational level, instead of focusing in a micro way on each employee's struggles.

Develop Success with Ongoing Check-Ins

Keep your mindset on developing others toward success, no matter the conversation, and make time for ongoing performance check-ins throughout the review period. For me, quarterly check-ins allow for building trusting relationships, capturing information that balances my observations, and preventing the Halo/Horns effect, using notes from the entire review period, and allowing a reasonable timeframe for any course correction needed.

The first one is for establishing 3-5 business-aligned goals, setting expectations. The next two are informal interim performance check-ins, with self-assessments and a guiding set of questions to facilitate a two-way conversation. The final annual review is more formal, incorporating input and feedback from the entire review period, which is why ongoing check-ins are so important. This approach has helped me build effective teams who are prepared, equipped, vested, and engaged.