Employee Evaluation: How to Conduct an Excellent Year End Performance Review

Employee evaluations are an integral part of every company, they can empower your employees and drive them to reach new levels of performance, or they can be unmotivating and drive them away. 

Performance Reviews are a great opportunity to review what is and isn’t working but also to define the next steps to take and align on shared goals. The mere purpose of evaluating employees isn’t just to review job performance, but it is to discover how to get the best out of every employee and work their strengths and skills in your company’s favor. In the worst case scenario, an employee evaluation can determine if an employee is not a good fit for the business and decide on parting ways.

 

Employee Engagement: The Definitive Guide

Everything you need to know about Employee Engagement

Either way, the effectiveness of an employee evaluation depends completely on how they are conducted. It’s often usual to have your employees nervous when their year end review is up, no matter how good they feel their performance was, it’s always nerve wracking to have these sessions with your manager. It is very important to know how to deliver the message you intend to share and have your employees receive and understand it completely. If you’re not quite sure how to prepare for a performance review process, we got you covered:

Set the Tone

You already know your employee is nervous, but the tone you set at the beginning of the employee evaluation will be the one carried out throughout the whole session. Try to give a warm greeting and ask unrelated questions prior to starting the evaluation, a little small talk might help shake off the nerves and will help your employee feel relaxed and open to receive your message during the employee evaluation.

Now that the nerves are out of the way, you can start  the employee evaluation on a positive note (considering the evaluation will be overall positive), and tell them that you really value their work and appreciate them being part of the company. If your employees do a good job, they want to know if you’re noticing it and they want to feel their efforts are appreciated.

Recap the Year or Quarter

By now you should have an agenda of all the items you want to review during the employee performance evaluation. It’s always important to keep track of your employees’ OKRs during the year, for when the time comes for a performance review you can be 100% prepared. A lot of performance reviews are based on what the manager can remember, but that’s not entirely fair since these evaluations cover a large period of time and managers should have a clear vision of everything that happened during that period. When you sign up for Hirebook, you’ll be able to assign objectives to your team and they’ll help you keep track of them, this way you won’t miss a thing when evaluating your employees’ performance nor will they.

Start by stating the overall ranking of their performance so you can start explaining why you chose that ranking point by point. It’s probable that your employee also has their agenda of things they accomplished or where they did an above average job, it’s important to give them a chance to speak but remember you’re in charge of the interaction and you decide when it’s pertinent for them to pitch in, just make sure that by the end of the employee evaluation they’ve said everything they wanted to say as to not leave things in the air or unfinished. 

Provide Relevant Feedback

It’s important to remember feedback doesn’t always have to be negative or a constructive criticism. Feedback also comes in the form of praise, you can check out our “Positive Feedback Examples” article to get some ideas on how to provide it. 

We strongly encourage you to not only provide feedback during performance reviews since they happen just a couple of times a year; feedback is something that should be consistently provided. Take advantage of your one-on-ones, you’re probably reviewing other items during them so why not give some feedback regarding something your employees are working on at the moment.

But the feedback you provide during a year end employee evaluation should be more insightful and should review a longer period of time. By now you probably know a little more about each employee, their strengths and weaknesses. Start by pointing out their strengths and how they help them do their job, it’s even better if you have some examples on how their strengths shined through a project or task, examples will make a stronger statement and they’ll reinforce positive behaviors. 

When talking about weaknesses during an employee evaluation, it’s important not to call them like that, but choose a different term like “areas for improvement”. Everyone has weaknesses and we’ve all got something to work on, but it’s particularly important to work on those areas for improvement that prevent employees from performing their best. As with the strengths, having examples will help you make a better point. As humans, we tend to focus more on the negatives than the positives, so stating an example of a moment where our weaknesses affected the job will have a huge impact on your employees and hopefully they’ll work on their areas for improvement. You can also check out this article on self evaluation examples to encourage your team to run personal evaluations of their performance.

In the end, there is always room for improvement!

Two-Way Communication

Ok, now that you’ve had the chance to lay down all of your positive and negative notes regarding your employee’s performance, it’s time to let them speak. Listen actively and don’t interrupt them, they too have a lot to say. The point of this is not to turn the interaction into an argument, but rather to see if there’s something you missed, regardless of it changing your rating of their performance or not. Your employees also want to feel heard and share their opinion during work evaluations, and you can comment on their points after they’ve aired out what they had to say and then politely explain you won’t change your employee evaluation rating since you gave it based on what you saw and experienced, but you can offer to do another performance review in the future and pay special attention on the matters they’re addressing, set a time for this review when agreeing on it.

Give your employees the opportunity to provide you with their feedback. As we said, there’s always room for improvement and that includes managers. Even if the employee evaluation is focused on the employee, that doesn't mean you can’t benefit from it too regarding your management skills.

Goal Setting

Having stated the strengths and weaknesses of your employee and interchanged feedback, now it’s the time to set the new objectives for the new period. It’s imperative that your employee knows what will be expected of them concerning performance and completion of tasks. Set deadlines for these goals that both of you agree on and verify if they’ll need some extra resources to accomplish such objectives. In this point  of the employee evaluation you can also discuss your employee’s career development, in order to encourage them to aspire for a better position in the future.

Establish how you, as their manager, will evaluate your employee’s performance from this point on and describe what you’re expecting from them, leaving no room for doubt. 

Salary

Not every employee performance review has to end on an increase in their salary. When approaching the end of the employee evaluation, make sure you share what the new salary will be, if any, and when it will be effective. 

End on a Positive Note

Do not let your employees leave with an unclear idea of their activities, goals and performance rate. Make sure everything you talked about during the employee evaluation is clear and that they have no doubt of what they have to do from this point forward. And, unless their review is unsatisfactory, let them walk out of the employee evaluation on a positive note; you could say something like how the company has enjoyed their contributions and/or how they’re expecting great things from them. If your employees leave the room high chested, you’re already winning in increasing engagement and you’re ensuring a top notch performance for the next period.

 

Employee Engagement: The Definitive Guide

Everything you need to know about Employee Engagement

An employee performance review process is not always an easy interaction, but it’s a much needed one. It requires a healthy balance between criticism and praise, and the establishment of attainable objectives for the future. As complicated as an employee evaluation may seem, there are a lot of benefits both managers and employees can gain. We hope these suggestions help you out when having your own employee evaluations.

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