Performance reviews should evolve with your company. In fact, it’s a good idea to change your performance review, even if your business model has remained the same. The business world is evolving with a new generation and an unprecedented level of digital technology. The old way of labeling or using performance reviews to classify employees often hits just left of the mark, making it important to shake up the process every so often to inspire action and productivity.

Lackluster Performance Reviews are Bad for the Employee and Bad for the Company

Actionable performance reviews are important for the business process, because they allow companies to see where employees stand and vice versa. They should serve as constructive experiences for both parties and a way to move forward with a better relationship.

However, many employees fear the process and managers hate spending time preparing for and giving performance evaluations. Here are some of the pitfalls management can fall into if they don’t shake up their review process:

  • Managers stick with the data instead of having a frank discussion: A comprehensive data matrix is important for providing a significant performance review, but it cannot take the place of managerial insight and support. If your employee comes out of a meeting feeling patronized, upset, or unimportant, the performance review itself can act as a hindrance.

Instead, the data should give a manager the information needed to have a conversation about what has happened, what will happen if the same patterns repeat, and how each employee (even a great one) can do better moving forward.

  • Managers fail to ask for and offer concrete examples: A performance review typically covers a specific period of time, and giving general feedback doesn’t do much to help employees identify and improve their behavior patterns. Use the time between performance reviews to make notes on employee performance in specific situations. With quantitative data and examples, managers can discuss performance more effectively.
  • The best employees have little to go on: A poor performance review process leaves star employees with no meaningful feedback. Everyone has some areas that could use improvement and, without a push, employees may never reach their full potential.

If you have no constructive criticism for an employee, try to find goals and added responsibilities that show management is ready to help an employee take his or her performance to the next level.

Signs It’s Time to Change Your Review Style

Many managers and employees consider the review process as a necessary evil. They must do it regularly, and both parties may dread the time, waiting eagerly for it to pass, so things will continue on as before. However, this type of approach helps no one and is a clear signal that it’s time to change your performance review process.

Here are some other signs that indicate it’s time to shift performance reviews in a new direction:

  • Performance doesn’t change: This could be an indication management has taken too soft an approach or the performance review hasn’t really hit the mark needed to enhance productivity. Your managers don’t have to scare employees to spur performance shifts. Real insight and encouragement for each facet of the review often provide employees with the information needed to improve.
  • You have a high turnover rate: It’s more cost-effective and morale boosting to retain employees than to accept a high rate of turnover. Performance reviews should promote retention and loyalty, particularly for high-level producers. When employees know where they stand and receive chances to grow and new challenges to surmount, you are more likely to keep high-quality talent on board.

Use performance reviews to identify employee strengths, and then place each individual in tasks that play to those strengths. The result is happier employees and a more productive company.

  • Managers drag their feet when it comes to performance review deadlines: A poor review process doesn’t affect employees only. It also changes the way management leads your human capital. Give your managers the understanding and power they need to effect meaningful change in their teams with a performance review process that is easy to complete and constructive.

While punitive actions are sometimes unavoidable, use HR training to help managers address problematic employees in a mutually beneficial manner.

Change the Review Process for Better Results

If any of this information sounds like your company’s review process, consider changing the overall setup for better results over time. The process is the key to making meaningful change within the organization, so investing in it may offer clear return on investment over time.

Consider these ways to make your employee reviews part of a positive and effective business routine:

  • Require managers to keep performance logs: Managers can run through the evaluation process more easily if they have regular notes to look at for each employee. Writing notes prevents managers from making assumptions based on feelings.
  • Encourage managers to use a consistent matrix: Invest in a performance review template system to ensure managers cover each relevant category for the department. A performance review is about more than skills and task completion. It also should cover relevant information on communication, leadership, time management, and initiative, among other qualities.
  • Ensure each review is fair: Each time a manager or supervisor calls an employee into the office for a review, require a standardized meeting format. Each employee should experience the same meeting layout and information covered in the review.
  • Take the edge off: Familiarize employees with the process beforehand, providing them with a copy of the template or how the company evaluates performance. Do not use routine performance reviews as a surprise conversation regarding poor performance. Instead, a review should confirm things management has informally discussed with an employee.

Without a solid performance review process, you could miss out on an opportunity to strengthen your internal culture and your overall brand identity. Sample a performance review creation template to create the data set your managers and supervisors need to have meaningful conversations with employees at regular intervals throughout the year.