It’s important to convey constructive feedback to employees, both to communicate the company’s needs and expectations, and to help them push their careers in the right direction. But evaluating someone’s professional performance may not be easy, and can if fact cause stress for both sides. In this article, we’ll go through the goals of employee evaluation and establish a good process for dishing out helpful feedback.

Whether you work at or run a small company, dynamically developing start-up, microcorp, large organization or any other place, you probably know the value of good, constructive feedback. But what if there are no clear instructions for conducting employee evaluation? If you’re a business owner or manager, your employees’ reaction is probably your main concern - you don’t want to demotivate them, or harm your relationship with them. You may not know how to begin or whether you are ready to carry a one-to-one session. Evaluation is usually difficult for both parties involved, but there are ways to make it less daunting and stressful.

What is employee evaluation really about? The truth is that this very corporate-sounding process most likely already exists in your organization, but you’ve never seen it among your internal procedures or witnessed it in action. Evaluations should be carried out by every company, except for maybe the smallest of startups. But even there, constructive feedback delivered skillfully can be a wonderful gift for employees. There are some rules that are worth paying attention to in order to make the evaluation more efficient and avoid errors that would be difficult to whitewash later.

Evaluation under any other name

You’d be surprised by how well this ubiquitous process might be hiding in your company’s internal documentation. Check for the following phrases on your wiki or shared drive:

  • feedback session
  • 1:1 session
  • yearly appraisal
  • 360 degree appraisal

They all mean the same thing, essentially: a process in which an employee sits down with an HR representative or their team leader for a conversation about this employee’s successes, failures, goals and career plans.

The 5 common types of employee evaluation

  • Normal distribution: an HR manager checks where an employee’s results rank compared to other persons in the same group (e.g. a team or the entire company).
  • Assessment centre: it involves assessing the employee’s conduct on an ongoing basis, e.g. during sessions where particular duties are performed.
  • 360 degree feedback: appraisal is carried out by persons having direct contact with an employee: their team, customers, an HR representative, direct managers or subordinates.
  • Pairwise comparison: an HR manager compares employees’ results in pairs, going through an entire group (e.g. project team), and assesses the quantity of positive indications for the skills under examination.
  • Self-assessment: an employee assesses their skills on their own and a manager assesses that employee by using the same appraisal sheet and scale. Notable differences in their results are discussed during an evaluation session.

Of course, these are only examples and each organization can have a different appraisal method. If you use one of these but not quite to the letter, and your unique process works, there might be no need to change it.

Evaluation as an effective management tool

Employee appraisal is a time for the employer to present constructive feedback, giving the team direction and inspiring them to do better next year. The employee can share their thoughts on how the company is operating, what they like about their work and what could be improved. It’s important to listen to their suggestions for change! They might be able to add something valuable to the company culture, either by sharing know-how from previous jobs or coming up with original solutions.

The time spent at an evaluation meeting should be valued and used fully. Organizations sometimes forget that employee appraisal is a human resource management tool, and not just a useless, compulsory procedure.

What can we use employee appraisal for, apart from FTE reductions, promotions or pay rises? Firstly, look at your company’s results from the outside, collect opinions on the effectiveness of your team, and see whether these opinions have something in common. On that basis, you can make a decisions affecting not only on a single company unit, but also frozen corporate processes, overly long communication or on any other processes that could use improvement. Only then, once your conscience regarding the environment the company provides is clear, can you think about each employee separately and about each employee’s yearly performance.

There is one more positive side effect of yearly appraisals: managers pay more attention to specific things they expect from their employees and exchange information with their teams more frequently. This leads to higher transparency and a more open company culture.

Looking at evaluation from the employees’ perspective paints a picture of potential that’s often untapped. A well-established feedback culture can be crucial in retaining top talent, as well as in nurturing younger professionals by allowing them to develop their careers in the right environment. If you can count on colleagues and the HR department to put effort into monitoring your progress, helping you establish clear goals, acknowledging failures and celebrating successes with you, you’re more likely to be highly motivated and productive. Achievement and appreciation at work can do wonders for job satisfaction, and it’s similarly good for team cohesion and overall company culture. When looking for a new job, ask the recruiters about their evaluation process and how they help their employees become the best they can be. It’s something that benefits both sides.

Common pitfalls to avoid during feedback sessions

Some of these pitfalls might seem very obvious, but take a moment to consider how evaluation is conducted at your company. Are you sure you haven’t started to treat the process as something to get over with as quickly as possible? Here’s a way to answer this question: make sure you keep the following rules in mind when evaluating employees.

  1. Make sure you set aside enough time to talk comfortably, without either side worrying about a “more important” task waiting for them after the meeting.
  2. Keep your company’s culture, goals, vision and values in mind throughout the session.
  3. Be methodical and go through the entire process.
  4. Collect data on an ongoing basis for later comparison. You might think you’ll remember the important stuff, but what if someone needs to replace you a few years down the line?
  5. Know exactly what to assess and what you really expect from each employee.
  6. Make sure both sides treat the meeting as important, and not just as another appointment to tick off their calendar.
  7. Take into account more than just the last two weeks of your employee’s work. Everyone can have a bad run, caused by a number of things, from the death of a cat to failing health. Take on a broader perspective.

If you want to face this issue professionally and be transparent to the maximum extent, run an information campaign at your company. Answer these questions, and share the information with your team:

  • Why do you need employee evaluation? What will the data you gather be used for?
  • What do you want to appraise? The criteria should be flexible and take into account your employees’ specializations and the professional differences between them.
  • Who do you want to appraise? The system should cover all employees hired by the company, but it should be different for individual or specialization groups. The system must be known to and accepted by everyone involved.
  • Who will conduct the evaluation? Heads of departments, other employees, customers?
  • How do you want to evaluate? You should take into account the specific characteristics of your organization. You should be fair, objective, and open to change.
  • When and how often do you intend to run evaluations? All the time, e.g. every day as part of code review (which is an important part of the software development process), or from time to time?

If you introduce the evaluation process at your company, you will need to consider what you really expect from your employees and whether your team deviates from your standards. Maybe efficiency is too low and you could earn more by improving it or, on the contrary, business processes must be changed or new jobs must be established because your employees are overloaded. This is vital information for your company’s growth.

Employee evaluation as an effective process

It’s become a trend recently for even the largest organizations to give up on employee appraisal. The common reasoning is that appraisal-related procedures create a negative atmosphere within teams and do not fulfill their role. Employee evaluation is associated with paperwork and a lot of stress resulting from an interviewer facing “aggrieved” employees. Besides, who has time for this sort of thing anymore? Changes on the market create confusion and companies introduce new strategies to cope with it. Yearly employee evaluation is simply unrealistic in some cases and seems to be an artificial process with unsatisfactory results.

Are there any counter arguments that can stand against this mindset?

Of course! Firstly, soft skills and employee productivity metrics do not change as dynamically as the market does. A remedy for the doubts connected with mood deterioration within teams and similar problems is the transparency of employee evaluation rules. It’s necessary to highlight their importance for the company and their compliance with the company’s values, as well as the advantages for employees they present. Adjust the system to your company and take your time - and remember to accept feedback.

Employee appraisal can be continuous or cyclical, e.g. yearly. Both options have advantages and disadvantages. What’s similar for all types of appraisals is that they let you know what you can expect from your employees, and allows employees who meet company expectations to feel efficient. They get to know for certain that they are developing professionally, which can be extremely motivating.

If your company already has an appraisal system in place, take the opportunity to analyse your employees’ attitude to the process. Distribute questionnaires, as your personnel is your best source of information. Thanks to them and the answers they provide, you can improve the system. Evaluating the evaluation is advisable right after you create it, too. If you listen to your team instead of making assumptions, the only side effect may be the improvement of team morale.

When to implement employee evaluation

Employee appraisal can help you perfect such difficult procedures as dismissal, introducing incentives and reprimands, and measuring employee productivity. Without an evaluation system in place, you won’t know whether an employee deserves a promotion or pay rise, whether they excel or need additional training to become more involved in their work. Employee appraisal should not be treated as a procedure, but as a management tool, and it should be adjusted to your organization’s specific needs. It’s important to change it when company culture or goals change, as well.

Remember that the implementation of an appraisal system takes time and can last months, or even several years. If you build a positive feedback culture, you will see the benefits almost immediately. If you implement clear rules and a friendly atmosphere, and stay flexible during one-to-one interviews, you have nothing to be afraid of.

Are you ready to work for a company that cares about your professional development? iRonin’s team works hard to build a good working environment, one in which our employees can participate in exciting projects, learn every day and always be challenged.