Take the terror out of performance appraisals

By KIM SMITH

Even small businesses should conduct performance reviews but for some managers, let alone the staff, this can be a daunting process.

While a successful review is a valuable tool to encourage your employees' performance and help them to advance their careers, you also have to deliver feedback that your staff may not want to hear.

How do you accomplish this and keep staff motivated at the same time?

The following pointers aim to minimise the stress of appraisals:

* Don't make it a surprise. Evaluating your staff throughout the year will help to keep the lines of communication open so that when it's time for a formal review, there won't be any shocks.

For example, if an employee needs to improve in a particular area of her job, don't wait eight months (until a formal review) to let her know.

Employees need immediate feedback, whether it's good or not.

* Deliver negative feedback effectively. Discuss weaknesses in a constructive way to keep staff enthusiastic about the job.

Give examples of how to improve in specific areas so the employee can remain optimistic in his responsibilities. Encouragement is the best incentive for improvement.

* Reinforce company values. Employees who are clear about your expectations of them and how their daily contributions tie into the company's goals are the most successful in their jobs.

Talking about key business objectives during the appraisal process clarifies your staff member's role and helps her to see the bigger picture. And if she knows she is valued, she will be motivated to achieve greater success.

* Consider a self-evaluation. You may want to ask staff to assess their own strengths and weaknesses before the review.

Not only does this offer a chance to examine their performance and career path, but it also gives you insight into their perceptions and goals.

Of course, some staff may feel awkward about rating themselves too highly or too harshly. Let them know that any discrepancies can be discussed during the review.

* Document all comments in writing. Cite examples to support your assessments, whether your feedback is positive or negative. For instance, if an employee lacks initiative, note one or two instances and detail ways in which she can improve.

A written record is also useful in case of any legal disputes.

* Keep the tone conversational. Schedule a one-on-one meeting with each employee for at least one hour to avoid being rushed or interrupted.

* Set goals for the next year. Make sure they are in line with your staff member's career path and tie into the firm's initiatives.

If your employee plans to advance into management, for example, then objectives should be geared toward acquiring the skills needed.

Performance appraisals are challenging for most managers but acknowledging a job well done and motivating staff to improve their performance will give them the confidence to advance in their careers.

You may even find you and your staff begin to look forward to the review.

* Kim Smith is New Zealand manager of Robert Half Finance & Accounting.