Four Key Elements for Conducting Productive Employee Performance Reviews

December 27th, 2011 by

With the New Year quickly approaching, managers are preparing for regular performance reviews with their direct reports. Employees at all levels may feel anxious as they receive or share a review. The Wall Street Journal (WSJ) reported that many organizations are getting rid of formal review processes because of the anxiety they bring to their employees. The article also included information from an academic review based on more than 600 employee-feedback studies. The data revealed that two-thirds of performance reviews had zero or negative effects on employees after they received the feedback.

Performance reviews, however, are critical for keeping employees on track with their individual goals and the overall goals of their company, and managers can conduct them in a mutually beneficial method. Because reviews often determine future career paths and merit increases, it is important for managers to spend adequate time preparing for them. Productive reviews with clear expectations, specific examples, constructive criticism and future action steps leave employees feeling motivated to achieve their set tasks.

Several ingredients make an efficient and beneficial performance review for managers and their employees. Use the four below to keep workforce morale high and plan for greater business success:


Great reviews start with great planning. Reexamine goals discussed in past reviews and collect specific examples of times the employee excelled and times the employee needed to improve throughout the year. Use this information to guide your review and help convey the expectations you have for the individual.


Constructive criticism is necessary for all great performance reviews, but positive feedback is just as essential. Research shows that employees have a need to feel valued, so take an opportunity during the review to recognize them for the hard work they have contributed to the company. If an employee has performed exceptionally well, reward them with a merit increase or a non-monetary perk if budgets are tight. Rewarding employees for their efforts will help keep turnover low.


An employee review must include participation from the manager and the employee. Give employees time to reflect on their own performance and let them prepare for answering questions related to their current work flow and future company activity. Allow for two-way communication when conducting performance reviews. Employees should be able to offer suggestions on how they can improve their work. They also should  feel comfortable to complain or mention items that could be hindering their performance.

Action Plan:

Once past performances are analyzed, it is important for managers to work with their employees to create an action plan for the next couple of months. These action plans should be revisited and updated frequently during the year. Monthly and annual goals should be included in these plans. Projects to strengthen professional skills and accelerate career growth also should be included into employee action plans. Having these plans will be helpful when preparing for your next employee performance review.

For more information or tips for conducting productive and motivating performance reviews, please contact a member of CAI’s Advice and Counsel Team at 919-878-9222 or 336-668-7746.

Photo Source: Highways Agency

One Response to “Four Key Elements for Conducting Productive Employee Performance Reviews”

  1. Kandy says:

    How many of us could say that our performance appraisal systems, which were designed to help improve the
    performance of the organization, are non-judgmental, non-threatening and
    done in a truly unbiased fashion. The plan should provide individual employees with
    specific goals, objectives and milestones needed to achieve their long-term professional objectives
    and goals. Another benefit is that you can create professional development programs that are better aligned to organizational

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