It’s that time of year again where many businesses are preparing for their annual performance reviews. Once considered a fundamental tool to ensure employee performance that is in line with the business’ values, direction and standards, performance reviews are now often sidelined for tasks deemed more necessary.
Time and time again I’ve heard from business owners not only their struggle to find the amount of time needed to have meaningful performance reviews, but their desire to have them in the first place. It seems that most business owners, rather than seeing them as an opportunity to have open and honest discussion with their employees, see them as stressful, costly, time consuming, and in some cases, doing more bad than good for employee morale.
But can we really afford to rule them out all together? We all know that if we want our business to be great, we need great people. The only way to ensure this is through communicating with our employees how we achieve our definition of “great”, and in what ways they can continue to grow to support that.
To maximise employee growth and performance, we first need our employees to be engaged. If we look at some of the key drivers of engagement, it becomes apparent that rather than completing dismissing the practice of performance reviews, we simply need to reshape them:
1. Role clarity – A performance review that not only reinforces the direction of the business, but the role that each employee plays in this is critical for employees to feel a sense of worth and importance to the business.
2. Feedback – We should not shy away from providing both negative and positive feedback to employees, as long as it’s constructive. Even negative feedback is far more motivating than no feedback at all, which leaves employees constantly questioning their performance.
3. Career and development – One of the biggest drivers for retention and engagement is that all employees have a sense that their skills and role within the business is continually developing. Employees that believe their career to be stagnate are the employees that most need your support, ensuring the performance review focuses around honest discussion about career objectives and potentials, and most importantly, a plan of attack to get there.
4. Values – The culture of your business is underpinned by both the values that are demonstrated and not demonstrated in practice. Ensuring a good culture is key to maximum employee performance, meaning all employees must aware of the values and behaviours expected of them.
The value of performance reviews isn’t to be dismissed, but they must be seriously reworked as we become more aware of the ways to best motivate employees and therefore enhance performance. By setting in place solid objectives and practices for performance reviews throughout the year, rather than in the weeks leading up, both employees and managers are in a better position to seek real value from the process, past simply checking boxes. Frequent informal and formal performance reviews ensure that poor performance or behaviour can be addressed before it becomes any major concern, and constantly addresses the changing nature of business and employees’ roles.
For a free consultation or review of your bonus or incentive schemes contact Talent Code at info@talentcode.com.au or 1300 559585.