Hi folks!
Every week, I’m sharing a practical, hands-on guide on how to run your small business better.
Today’s topic: How to run employee reviews.
Before we start:
I know first-hand: time is everything to a business owner.
You don’t want to spend all day Googling the best way to do stuff. You just need the answers.
That’s why I’ve produced over 50 of these playbooks. I’ve also got a library of templates for the stuff small businesses need — everything from meeting agendas to cash projection spreadsheets — and a ton of expert video calls and Q&As on all things small business.
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Why run employee reviews?
The reality is, nobody NEEDS to run employee reviews. You could just have your people clock in, do their job, and clock out again.
But that path doesn’t lead to growth for anybody. And if your business values the professional and personal growth of its employees, then employee reviews are an essential part of that growth. A proper review process is an opportunity for self-improvement, and when your people improve, your company improves too.
There are three distinct benefits of running a good review process:
First, perspective. In the day-to-day of business, there’s rarely time to slow down and reflect. Building in an annual review process forces everyone to step back and take a longer look at things.
Reviews are also a relationship-building tool. The review process, done correctly, also fosters collaboration between the manager and employee to talk about their career, tackle their challenges, and discuss their goals and ambitions.
Finally, reviews keep everyone “rowing the boat” in the right direction. Making sure everyone’s got a clear understanding of the business’s goals saves a ton of wasted effort on everybody’s part.
Employee reviews are not comp reviews
Don’t group together employee reviews and compensation discussions. Combining them turns the review from a growth-focused discussion into an audition for a raise.
I recommend separating employee reviews and compensation discussions (raise, bonus, or promotion) by a minimum of two months.
Now… let’s dive in!
The Playbook: Running employee reviews
This is a no-cost method of running reviews, and works well for small to mid-sized companies. For larger companies, there are paid products out there you could explore — try Leapsome, Lattice or CultureAmp.
1. Tell the employee (“reviewee”) how the process will work
If you’re following this, it could be as simple as forwarding this email. If you want to adapt the steps to your own needs, that’s fine too — but let them know what to expect from the process.
Being open about the process starts your review on a collaborative note.
2. Choose 2–5 peer evaluators, and send them some questions
Getting perspectives other than the reviewee’s and your own is essential to a good review process. Select a small group of people who work directly with the reviewee. They could be co-workers, external vendors, or direct reports.
Make sure they know their feedback won’t be shared with the reviewee.
Use this Peer Evaluation Template as a starting point.
You may decide to have follow-up discussions with the selected Peer Evaluators if anything needs to be clarified or discussed further.
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3. Send the reviewee the Self-Evaluation form.
Use this Reviewee Self-Evaluation Template as a starting point. Feel free to copy and adapt however you like.
Ask questions about their ability to perform in the role, their goals, and the areas where they see room for improvement.
4. Write your evaluation of the reviewee.
Use this Reviewer Assessment Template as a starting point.
5. Schedule a 1:1 feedback discussion with the reviewee.
Once you’ve collected all three forms, combine those notes together and book a time to discuss.
Keep your conversation simple and open-ended in topic. You shouldn’t try to cover everything in the assessment — prioritize for the most important information, and don’t ask questions you know the answer to already.
Areas worth discussing include:
Employee’s future growth
- What do you see as your biggest challenge going forward?
- Are there any professional growth opportunities you would like to pursue?
Personal Improvement
- What will you concentrate on in the next three to six months to help you grow and develop?
- How can we help you to grow professionally? Personally?
Relationships – with managers/teammates
- Was the feedback you were given this year valuable? Do you have any preference in how you receive feedback?
- In performing your work, what actions by your colleagues (manager or teammates) are the most or least helpful?
- How would you describe your relationship with your manager and the rest of the team?
Employee strengths
- What strengths help you to excel at your job?
- Which skills make you efficient and effective in your position?
- What type of work motivates and inspires you?
Make sure to take notes on your discussion.
6. Have the reviewee set personal and professional goals.
After your discussion, send the reviewee the Reviewee Goals and Objectives Template, where they should lay out their professional and personal goals and objectives. (You’ll work through these together in the next step.)
Encourage them to set SMART goals.
7. Schedule a followup discussion on goals.
This is where you can make sure their goals align with the company’s needs.
Work with the employee to create positive personal goals like, “I will take 3 weeks of fully unplugged vacation this year”, or “Every Thursday I want to leave early to attend my son’s soccer practice”. This sort of goal can go a long way to mitigate burnout and makes for happier employees.
8. Schedule a quarterly progress meeting
Setting goals is only worthwhile if you hold them accountable. Book your quarterly meetings now, so you don’t lose track or skip a quarter.
These quarterly reviews allow for check-ins on goals, identifying areas of improvement, and discussion on growth in the areas of improvement you’ve already discussed.
That’s it for today!
I want to hear from you — are these playbooks helpful? What topics would you like to see in future? Hit reply and let me know!
Michael
P.S. A reminder — Scalepath members get access to a library of playbooks like this one but with more “meat on the bone”. Plus new releases every week, templates, expert video calls, and a great community to connect and learn with. Apply today!
