We're getting ready to formalize our processes around employee reviews and I wondered if anyone had some great advice and/or links to articles/resources that are valuable on the subject. I've never personally liked reviews - the system itself seems almost fundamentally flawed, but I also recognize that they become a necessity at a certain size and we're probably there (23 people).
Thanks much for the help!
Reviews can be fun if you have the right attitude:
If there really is a problem with someone, the way to address it is NOT in a formal, scheduled review, but immediately. So that's not the point of a scheduled review.
I'm not an HR person so am sure there will be lots of better answers than mine but as a person who's given and gotten a lot of reviews over the years, some thoughts:
Best advice I can give is to be honest and be prepared. I know of way too many managers over the years who don't feel comfortable communicating negative feedback to their employees...or just communicate some but gloss over much. In some cases it's because they don't like conflict or confrontation and it just makes them feel really uncomfortable. In some cases it's because they get intimidated by employees who are defensive or confrontational. But you have to do it.
Because the employee will never improve if you're not completely honest with them. This is about learning.
And if you ever have to fire an employee, having a trail of positive reviews can be a real problem. Again, seen that many times.
Another reason is other employees. It will get around if somebody got a good review when others feel they're a poor performer and vice versa. So be honest.
As you're doing, find a good template for an employee review and be thorough in filling it out. Make sure to have examples for both positives and negatives. Take a few days to fill it out because things will keep popping into your head to include in the review. If you do it all the night before you're going to miss a lot and do a disservice to your employees.
Be constructive when talking about areas to improve.
Don't just talk "at" the person, talk with them. Let them provide feedback and input while making sure to communicate your points. You might have a particular project they screwed up on, for example. Ask them how they felt about it first, let them talk, then share your perspective. Often that creates a much more productive dialog than just dumping on them. But you still get the same point across.
Have an action plan at the end for what you want them to do to address weaknesses and continue their positives. But make it constructive and positive. This should be something they're happy about because it's helping them develop and contribute to the company.
There shouldn't be surprises in the interview. If you know somebody really has performance issues and it's going to be a negative review, make sure you've given them feedback and counseling and such before. And if it's a rave review, they also should have received recognition previously. An old adage - you should never be surprised when you get fired or promoted. Same with reviews, should never be surprised if it's a negative review or a positive review.
All that said, lots of people think reviews are a total waste of time. To each their own. If you're doing them, make the most of them. I think they can be real helpful.
I'm done spewing...see what others say.
I am not a fan of performance reviews, as what you measure will decide what is important, and so be what people focus on, as they want to get a good performance review.
I prefer Deming's view that people will work better if fear is removed.
At that point you would just look at making certain everyone is focused on what is going on, so, you could point out how your competitors are doing and track the company toward being the best, for example.
Why do you need performance reviews? What is the purpose?
If you have people that are not doing well, either find out what they will excel at and have them do that, or, just have a paperwork trail to document when they get fired.
I find that reviews don't help, at least in my experience, as someone should know what they are doing well and where they lack.
You could read "The Fifth Discipline" by Peter Senge, and get an idea about what a learning organization is, and if you focus on developing the company that way, and ensure that everyone can add to the quality of what you do, and everyone is able to continue on self-improvement/education, then I am not certain what you will benefit from doing these reviews.
A couple of thoughts from perf. reviews I've done in the past:
Performance reviews are better done in incremental chunks (like once a quarter). Doing a mini-review or quarterly goal review seems to work well for us. I was exposed to this at a former employer and thought it was a bit much initially, but found that over time, the feedback intervals are natural. It also allows me to remember what they did in shorter intervals -- thus not having to rely on the last couple of months impression.
Part of the naturalness of the quarterly review was the notion of quarterly goals. Setting and reviewing goals every quarter was a great way to adjust expectations as conditions changed. It was also a great way for employees to know what is important and how they are doing toward the overall companies goals.
Here are my four suggestions on this topic...
Hope this was helpful. I'd love to hear dissenting opinions on this.
HR is something that many companies, especially startups, don't give the proper attention to. While you could read a few articles about it, it is a complicated process to do right, and something that you should do professionally if you want it to have the right effect.
If you don't do it the right way, it could damage the company, since people will feel less secure about their jobs and less motivated, since as you said, " the system itself seems almost fundamentally flawed".
If you want to do it right, by getting a specialist, thats great. If not, then it may not be a good idea.