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Employee Performance Evaluation – 5 Steps to Reduce Turnover, Improve Morale and Build Trust
In today’s ultra-competitive business environment the demand for qualified talent is greater than ever. As the workplace continues to change, it becomes apparent that successful organizations are those that can attract, retain, develop, and lead a diverse workforce.
A major driving force behind retaining good employees is maintaining high morale in the workplace. Yes, it is important to have strong management and leadership in any organization.
But, what process do fast-growth companies utilize to account for performance goals, improve morale, develop and recognize employee achievement to ensure both managers and employees are performing at their best?
To often, front line managers do not have a formally defined process which supports their company’s performance management strategy. When this process is missing or fragmented, companies place themselves at risk: conflicting expectations regarding roles and goals, lack of standardized methods and unclear communication can create significant ramifications.
Also, the company image, relationships between the managers and employees, as well as the quality of work is impacted. This can lead to a decrease in employee morale and job satisfaction, which ultimately impacts the long-term growth and success of the organization.
This article defines a simple, yet highly-effective proven process for developing and retaining some of your company’s most important assets: your employees.
Step 1 – Define the results you want to achieve by implementing the process. Some examples would be: to foster an environment of open, honest communication, to communicate both company/department goals and objectives, to establish performance standards and to create a feedback loop between management and employees.
When results are documented and used as the framework to reference to employees, management now has a clear perspective on what needs to be done to move forward in creating the entire process. All employees benefit because everyone is on the same page, and can now identify company goals and objectives.
Step 2 – Set company goals and objectives, and determine what is required by employees to achieve these goal and objectives. Recognize, in many cases the vast majority of supervisors and managers are unaware of the importance of goal setting and the power of goal-oriented management.
By defining company goals and objectives, you not only give employees a target to identify, you create a platform for dialogue between management and employees to observe what goals are being met, and what must be done to ultimately achieve all goals. By linking goals from executive management down through to rank and file employees, everyone identifies the big picture and ultimately what must be accomplished to sustain the organization’s growth and profitability.
Step 3 – Document the performance expectations. Define performance expectations in a simple, easy to read format that includes performance categories – usually no more than six major categories are necessary. Categories may include quality and quantity of work, attendance/punctuality, teamwork, safety and communication. Certain categories, such as quality and quantity of work, must be measurable. The benefit of implementing measurements within expectations is the company will move one step closer to establishing clearly defined standards.
These measurements can be linked to department/company goals, incentive pay, an existing compensation model and consideration of certain employees for promotion within the organization. In addition to defining formal performance expectations, create an absentee calendar and communication log form.
The absentee calendar form is used to document attendance and punctuality, while the communication log form serves as the medium where communication between the manager and the employee, regarding performance, is formally documented. Consistent use of both forms by management provide a means to document performance in real time.
Step 4 – Create and utilize an employee performance review form with a performance planner. The employee’s performance review will give both the manager and the employee a snap – shot of the employee’s overall performance over a specific time-frame. What’s important about the employee performance review is it reinforces what the expectations are, if they were achieved and where the employee scores in relationship to his/her peers in the workgroup.
The performance review can have either a sliding points measurement or can be defined in terms of outstanding, above average, average, unacceptable or not observed. Managers should always document and retain on record, the employee’s performance as it relates to both expectations and company goals.
The benefits of accurate documentation are many. Not only will the company have an accurate record of both good and bad performance, but should any legal issues arise (discrimination, wrongful termination, unfair promotion), the documentation serves as a reference point to all parties involved – the facts are all there.
Also, integrating a performance planner on the backside of the employee performance review serves an important purpose. It answers two big questions; “How am I doing?” “Where do I go from here?” The performance planner should include performance areas where improvement is needed, knowledge, skills, or abilities that must be developed to result in the improvement.
There should also be an area to document development activities/assignments (these are the planned activities for addressing the areas of need) and finally, projected implementation/completion dates. Verify both the manager and the employee sign and date days of discussion.
Step 5 – Organization, timing, frequency and scope Organization of the aforementioned documents and forms is easy. To make management of this process even easier, visit your neighborhood office supply store and purchase a six-sided classification folder (Globe-Weis Part #PU561GRE). The folder provides ample space for all individual employee documents and forms.
A recommended format layout of all documents is listed as follows:
Flap 1 – Employee Performance Review and a formal Performance Planner Form
Flap 2 – Performance Expectations – current and yearly (This should be there when you hire new employees also)
Flap 3 – Calendar showing attendance history – yearly
Flap 4 – Communication log forms
Flap 5 – Documentation defining company goals and objectives
Flap 6 – Letters of Recognition, Awards, Certificates, Etc.
Timing the process begins once the decision is made by executive management to amend its current performance management strategy. Once the first drafts are completed, the assigned management team reviews and approves or rejects all documents prior to implementation.
Upon completing all forms, it’s now time to roll out the new Performance Management Plan. For newly hired employees, it is recommended performance expectations, communication log forms and company goals be communicated during the first few week of employment.
Doing this will eliminate any concerns the employees may have about their role and job responsibilities. Once an employee is hired and depending on the job and scope of work, employee performance reviews should be completed at least every six months.
For employees currently employed with the organization, the new plan can be phased in with scheduled semi-annual employee performance reviews. With regard to the scope of implementation, once the documents are completed they can simply be reproduced for distribution throughout the company. Depending on the size of the organization, specific performance expectations can be modified to match specific criteria within different departments.
Remember, the key is to master the process. Once the process is implemented, managers can then explore ways to improve content. This is what operating standard are all about.
The benefits of implementing this process within the organization are enormous. It serves as a tool to effectively establish and communicate performance standards which will improve employee morale, performance and the overall quality of an operation. It serves as a vehicle to reduce Human Resource
Management issues (discrimination, wrongful termination, unfair promotion) and allows mid – level managers to focus on other areas of the operation without being bogged down with “people issues”. When the process is implemented throughout the organization, it becomes much easier for new (and transferring) managers who are assigned to take over an existing work group.
Should you need to see what the ideal internal Performance Expectations, Employee Communications and Follow-up Forms look like, please contact me directly? Finally, following the process helps everyone identify what’s important, where the employee stands in relationship to performance and what needs to be done so everyone performs at their best.
After doing this with dozens of companies in North America, this is what you can do to improve communications and execute HR functions much more effectively.
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