I told my wife that I was working on a blog post about giving employee performance reviews. Her automatic response was, “Reviews SUCK!” Exactly. I know a lot of companies whose managers complain about performance reviews. It could be that they batch all of the reviews up for one big session a year, or just feel like they are constantly filling them out and having those weird quasi-negotiation review meetings, or ignore them all together. If you’ve escaped all of that, my hat is off to you and you can skip this nugget. If you haven’t, I have something that will help.
What most business owners and managers in don’t realize is that laying the groundwork to break that cycle starts way before the review itself. When boiled down, the review process is rather simple. However, the company oftentimes hasn’t defined the expectations and still moves forward to evaluate the employee subjectively. It gets frustrating for the manager and the employee.
In my business, we had what I thought was a thorough performance review package and employee manual. Turns out that it satisfied the state’s labor laws more than my employees. It was well written and credible, but every time I sat down to prepare a review ahead of the meeting, I ended up looking at this thing in disdain. There were 30 feedback points and I felt like I had to customize it and work really hard to craft my message for the employee every time anyway.
When we implemented the Entrepreneurial Operating System® or EOS®. It wasn’t obvious at first how simple it would make reviews, but once I got it, it was magic! I mentioned laying the groundwork earlier. There are a few EOS Foundational Tools™ that all come together and save us from the dreaded and subjective performance review.
- The Accountability Chart – Like an Org chart on steroids, the Accountability Chart defines 5 Roles that every position is responsible for. This provides a solid answer to the question “what do you do here?”
- The company’s Core Values – Core values are defining characteristics of the company’s culture in which you use a simple grading system to define conversations around guiding them in the right behavioral direction.
- Measurables – Every employee in your company should have at least one Measurable to be responsible for. It helps them understand how their performance is contributing to the company’s goals. No drama. Straight up objective feedback.
- Quarterly Rocks – A Rock is a 90 day goal that relates to helping the department and company achieve its priorities. Every employee should have at least one. This is where you can decide together with your employee what their most important priority is for the quarter. It could be some training or skill, moving a passion project forward, or even getting them involved with improving the culture like planning a recognition program or employee event.
With the groundwork laid, the employee review process gets a whole lot simpler for your managers. They meet with the employee quarterly and have a structured conversation that doesn’t need a lot of prep. If you are thinking that quarterly is too much, imagine having shorter meetings because they are more insync and successful for you and themselves.
Here’s how it works…
- Use the People Analyzer™ to review the employee’s fit to Core Values and if they Get it, Want it, and have the Capacity to perform the 5 Roles on the Accountability Chart in which they are responsible.
- Review the results of their Measurable for the last quarter. If they underperformed, have that conversation here and create a plan for moving forward.
- Review the completion of their Rock for the quarter.
- Ask the employee what they are proud of and what they would have done differently.
- If you are going to bring correction in to the meeting, make sure that you have 3 examples of the behavior to correct and what you expect to happen.
- Create a new Rock for the next quarter. Make sure that it fits your department or larger company priorities so it is properly contributing to the whole.
Like anything good that lasts, this takes some work. The set up here by the company’s leadership is key. Luckily for all of us, Gino Wickman has shared EOS® in his book Traction. It’s a practical set of simple tools with a proven process to help Entrepreneurs strengthen the Six Key Components™ of their business. The tools mentioned above are available on the EOS Worldwide website. If you are a business owner or leadership team member and would like to learn more, I offer a free 90-minute education session for you and your Leadership Team to learn more.