Stop Hating on Performance Reviews

Topics include:

One of the main reasons New Year’s resolutions fail is that people bite off more than they can chew. Like they’re going to

What sporting events would look like if judges hated performance reviews.

What sporting events would look like if judges hated performance reviews.

completely overhaul their diet and exercise and sleep and stress habits, all at one time. Failure is inevitable. Business owners do the same thing with their business resolutions which is why those fail. Like they put off doing employee performance reviews because they think they have to simultaneously figure out the question of who gets raises and how much the raise is going to be and how employees will react when the raises—or lack thereof—are made known. Here’s an idea for success: Divorce performance reviews from raises.

Yep, just separate them. Make reviewing your employees’ performance its own project that deserves complete focus. I’ll tell you why.

For one thing, people tend to think of performance reviews as something horrible to be endured—like going to the oral surgeon for the painful treatment of a rotten tooth. Performance reviews shouldn’t be like that. In fact, managers should be doing mini versions of the annual performance review all year, so it becomes a helpful measure, rather than Judgment Day. Whenever I get a call from a client telling me they have to fire someone, my first question is always “Does the employee have any idea this is about to happen?” If the answer is no, that tells me a lot about how the company communicates with employees.

Most people want to grow in their jobs. They want to improve, add new skills, become more valuable for the next position. Performance reviews should help them do that. They should set goals about future skills to be acquired—learning that code, cooking that dish, administering that policy—and success measures to be met. That helps both the employee to grow in his career and the company to grow and increase profits. And if the employee has some other problem, it behooves both of them when that is communicated as well.

I’ve talked to managers who said “Yeah, the employee does his job, he’s just really hard to be around.” Hellllloooooo! That’s part of doing his job. Being really hard to be around counts as poor performance and if it’s true, the employee should know it and have a chance to amend it.

Performance reviews shouldn’t be about pay or treats or gold stickers. They should be about everybody getting better and making a better company.

So when do you talk about raises? How about when you’re looking at benefits plans? Think about it. Frequently when considering raises, the issue is: Yes, employee, I only gave you a two percent raise. That’s because the cost of your benefits went up $1000! It’s what is known as the Hidden Paycheck and you shouldn’t hide it any more. Employees sometimes tend to think of benefits as an All You Can Eat Buffet when it’s really a whole bunch of a la carte items. If you tie raises to benefits that can just be about money, not performance. You can do market surveys to show employees what the going rate is for their type of work in your market, what benefits packages add up to and why the cost of living increase you gave—or the raise—is fair.

The bottom line is, performance evaluations take a lot of work, when they’re done well. It’s too stressful for a lot of businesses to link them with raises. So just don’t. Make it about performance and growth and everybody getting better. That’s really what you want your employees to be focused on anyway.

We work with companies on a project basis or on retainer, providing a custom level of HR help designed for your business. Contact me at Caroline@valentinehr.com or call (512) 420-8267.

We work with companies on a project basis or on retainer, providing a custom level of HR help designed for your business, with offices in Austin, San Antonio, Dallas and Houston. Contact me at Caroline@valentinehr.com or call (512) 420-8267.