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How to Give Performance Reviews That Make Your Company More Valuable

It's performance review time at my company. I don't know about you, but I look forward to giving my staff reviews. And unlike at a lot of companies, I'm pretty sure my employees like them, too.

Reviews are not a once-a-year affair at Blinds.com; they're a continuous process. I think of them as a way to improve my people, beat our competition, and more generally, positively transform the entire company. If you dread or even fear giving annual performance reviews, read on.


As I see it, here are the problems most managers have with reviews:

1. Time - If you don't have the time to give reviews, you simply don't see them as a priority. They are.

2. Fear - You're afraid of hurting people's feelings and lack the technique for giving candid, constructive feedback.

3. Lack of process - Your company has a form to complete, but it has not been designed for your needs. Essentially, the form is boilerplate and worthless.

4. Lack of content - You don't know what to say in a review, which means you didn't have a good plan last year or you didn't document interim reviews. (What, you don't do interim reviews?)


Now here are some suggestions for you to get the most out of reviews and view them as an effective way to make your company far better:

1. Prioritize - If you want people to change, don't expect them to read your mind. Secretly wishing for improvement won't make it happen. Have you ever known someone who's passive aggressive over something that ticks them off, but does nothing about it? That causes resentment, is unhealthy in a relationship, and will sabotage communication and ultimately execution.

2. Candor - Jack Welch, as he writes in his book, Winning, believes that the single greatest problem in business is a lack of candor. You must be clear and not sugar-coat what a person needs to hear. Glossing over issues will make people believe that they don't need to really work on them. So be polite, respectful, but brutally honest.

3. Expectations - If people are to perform at a designated standard, then they need to know what that standard is. And it should be objectively quantified and measured. Think of each employee as a new hire and determine what over the next 90 days, 6 months, and year you'd both agree constitutes success.

4. No surprises - There should NEVER be anything said or written in an annual review that's a surprise to the employee. This is a hard one because many managers withhold information throughout the year. If you're clear about what's expected and you've had consistently scheduled meetings throughout the year giving candid feedback, and you've put that feedback in writing, then at the end of the year you will have no problem merely reviewing your notes -- you've got everything you need for the review.

5. Clear plan - Both you and your employee must agree on opportunities to leverage strengths and to either mitigate or shore up weaknesses. Be specific, quantify what success looks like, and provide timelines for each goal. Provide suggestions on what the employee must do in order to achieve those goals.

6. Alignment with core values - Ensure that a large part of the review addresses how their performance and behavior is aligned or not with your company's core values and mission.


If all this sounds like a lot of work, it is. But this is your job as a leader -- to make everyone around you better than even they thought they could be. The alternative is to keep things exactly as they are, settling for mediocrity, while your competition does this work and figures out ways to put you out of business.

What are some red flags you've seen and some tips you've found to improve your review process?

Photo courtesy of Flickr.com, by t3rmin4t0r