Why Better Employee Reviews Create Stronger Bottom Lines

January 31, 2018

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Managers and individual contributors have differing priorities, but they can all agree on one thing: Nobody enjoys traditional performance reviews. Moreover, studies show that annual reviews are not effective and negatively impact motivation. A better review process can ease the strain on both leaders and employees, while creating a stronger bottom line.

Frequent Reviews Improve Performance

Traditional, annual performance reviews have one major design flaw: Timing. It’s hard for managers to remember all the positives and negatives of the past year, and it’s even more difficult for employees to correct behaviors when performance discussions occur once a year. Quarterly or monthly reviews allow managers to address issues quickly and implement plans to help employees improve. Frequent reviews also require managers to check in with employees to monitor progress. On a positive note, frequent reviews also allow for better reinforcement of positive behavior, improving the quality and quantity of production.

Actionable Feedback Improves Outcomes

Traditional reviews typically involve a rating system in a set of generic competencies. Using broad categories to measure performance provides an inaccurate snapshot of an employee’s true contribution level. Is someone really a top performer because they scored well in vague categories? Some companies are trading in their rating systems in favor of documented, formal feedback from managers, colleagues and customers. It is much more impactful for an employee to hear statements like, “Susan is the first person I call when I need a report quickly and accurately,” over, “Susan rated 4/5 in general work competency.” Specific feedback from various sources paints a clear picture of an employee’s performance and keeps them tuned in to the ways their behaviors impact others, improving outcomes across the board.

Better Reviews, Better Culture

When reviews are more frequent and are centered around actionable feedback, the culture of the organization begins to shift. A strong review process ties the role of each individual contributor to the success of the organization and gives them a reason to work harder. People get a better grasp of where they fit in to the big picture and how their work impacts others when you cultivate a culture of communication. Such a culture also improves engagement over time. When employees feel like their contributions are valued, they become much more productive over time.

Looking For More Advice?

For more strategies on how to improve employee performance and your bottom line, reach out to the experts at PrideStaff today!