For those who can’t quite fathom the how and why of a performance review, the concept can be a daunting one. Receive an email informing you that an appraisal is on its way, and you wouldn’t be alone in conjuring up thoughts of fierce criticism, ruthless auditing and a genuine sense of dread.
On the contrary, when carried out correctly performance reviews can actually be an incredibly valuable experience, for both the employer and the employee. So, we’re here to bust the stigma and explain what performance reviews are, why they matter and how your business can use them to maximise growth and success.
Defining performance appraisals
Also known as performance reviews, performance appraisals are used to explore the contributions of an individual employee and assess strengths and weaknesses within the role. Not only are they used to evaluate performance, but they also play an important role in defining job growth opportunities, setting employee goals and outlining benchmark standards. This includes marking out targets that an employee should be striving for during the next appraisal period. They can also feed into promotion activities and remuneration (bonuses, etc.).
While the methods will vary from role to role, and business to business, performance appraisals will generally involve interviews with the employee, self-evaluations and upward evaluations.
Why do you need employee performance appraisals?
Below is an outline of the major benefits of performance appraisals.
When used constructively, performance reviews can be used to target areas of weakness that are in need of evaluation and improvement. Strategies can then be developed to address these weaknesses, target training needs and focus on the narrowly defined areas that will help employees perform at their best.
From an employee perspective, performance reviews are a valuable tool when it comes to scoring promotions, salary raises, bonuses and career advancement opportunities. They offer HR departments tangible insight into achievements, and often play a key role in the decision-making process around who deserves what in terms of career development and future investment.
In a long-term context, performance reviews can be used to map progress. By comparing results from period to period employers can get a glimpse at whether or not an employee is improving, regressing or maintaining stable performance. This empowers HR departments with valuable intel, which is often used to dish out salary increases, promotions, demotions and even terminations.
Building stronger relationships
The importance of healthy employer-employee relationships should never be underestimated. Performance appraisals nurture this relationship, and give both parties the chance to engage over not just performance data, but also employee goals, growth opportunities, concerns, workplace culture and more. The development of this all-important rapport keeps communication lines open, and ensures that corporate conversations flow both ways.
As far as employee performance is concerned, appraisals can serve as a hugely powerful motivator. Work ethic jumps when employees are held accountable for their performance, with the opportunity to win recognition for achievements also serving as a stimulus.
If there’s one part of the performance appraisal process that people hate, it’s the self-appraisal. After all, how do you detail your accomplishments without coming across as braggy, and detail your missteps without shooting yourself in the foot?
But despite the fact that it’s a much reviled part of the process, the self-appraisal does serve a few purposes. Some of the main benefits include:
- Performance review meetings between the employee and management may be shorter when a self-appraisal has been done first
- Employees may be encouraged to self-evaluate their own progress and performance throughout the year, which helps them take ownership of their own success
- Actively involving employees in the performance review process can help them be more engaged
Staff performance appraisals
Of the various methods of performance appraisals out there in the world, the one with which you’re most familiar is likely to be the staff appraisal.
In a staff appraisal, a manager assesses an employee’s job performance, taking into account their successes and failures. Historically, these have been performed annually, though that’s not necessarily the case these days, as companies move away from annual reviews and towards frequent feedback, one-on-one catch-ups and mentoring sessions.
Regardless of the method or frequency of staff appraisals, you need to ensure that your employees are being given benchmarks that are fair and measurable. Ultimately you need to equip your employees with the resources to succeed.
An upward appraisal is one the most under-utilised elements of the performance appraisal process. In an upward performance appraisal, employees evaluate the performance of their managers.
Of course, employees are not able to evaluate a manager’s job performance in areas they have nothing to do with. Instead, upward appraisals focus on performance as a manager. This gives higher-ups a broad picture of how teams are performing across all levels. Other companies may embrace 360 degree reviews of employees, which factor in feedback from peers, customers and other stakeholders.
Our favourite performance review templates
Every role is different, which is why it’s important to customise your employee review process depending on the unique KPIs of your employee. The websites below provide some great employee performance appraisal examples.
Simple and to the point, this template is great for reviewing the performance of casual employees with minimal responsibility. It outlines the basics, and will help to keep employees motivated and on-task. This one’s versatile and translates to all industries.
Retail sales associate
Detailed and tailored to retail roles, this appraisal template is ideal for reviewing the performance of part-time and full-time sales associates, especially in management positions.
Fair Work Ombudsman Guide
For Australian employers, your one stop resource for appraisals of all shapes and sizes, Fair Work offers fantastic guidance when it comes to putting together custom performance review strategies. Scroll down to the ‘Managing Performance’ and ‘Managing Underperformance’ sections and you’ll find detailed checklists, templates, plans and more.
From a chore to a mutually beneficial process
Performance management should never be ‘set and forget’. It should be an ongoing, collaborative process that ultimately helps employees achieve more from their work. More than simply a chance for bosses to pound employees with a Jack Donaghy-esque appraisal, performance reviews should be a constructive and synergetic part of your workplace.
We’ve explained the benefits and hooked you up with some fantastic resources for creating your own templates. Now, it’s time to implement your own unique strategy, and start working towards building a performance conscious workforce that’s motivated, connected and nurtured with the feedback they need to consistently improve.
Humanforce is a leading provider of composable, best-of-breed workforce management, payroll and wellbeing solutions that simplify onboarding, scheduling, time & attendance, pay, employee engagement, and communication for frontline workforces. Founded in 2002, Humanforce has a 1700-strong customer base and over half a million users across a wide range of industries, including aged care, child care, hospitality, retail, local government and more. Today, we have offices across Australia, New Zealand, and the UK.
Our vision is to make work easier and life better by focusing on the needs and fulfilment of frontline workers and the efficiency and optimisation of businesses. Keen to know more? Please contact us or schedule a demo.