Performance Reviews: No Need for Teeth Pulling

By Steven E. Sacks, CPA, CGMA, ABC

Companies or firms either employ a formalized, thoughtful and comprehensive approach to evaluate employees, or they just use their gut instinct on a timeline that is not consistent. In any event, the amount of effort expended will yield a proportionate return on investment. There are, however, situations where companies go overboard in their quest to acquire information and deliver their findings through a process that is slow and plodding.

To be sure, there needs to be a proper balance that will focus on employees’ strengths and weaknesses; offer thoughtful recommendations for improvement; and limit the amount of generated paper. Most important, companies that desire to get this process right will not discuss compensation (e.g., raises, bonuses) during the evaluation phase.

The standard approach to assess performance uses a defined set of behaviors, more often referred to as competencies. They are skills, characteristics, and proficiencies. The question is: What attributes are necessary for employees to succeed in our company? Specifically, what are the differentiating factors that separate the superstars from the mediocre ones. Every company has their own set of factors that are relevant, so it would not be purposeful to use a generic template.

Companies’ human resource professionals need to review their performance evaluation forms to ensure that employees understand the questions asked of them. In fact, using the “you” attitude on open-ended question will yield more useful information. The key is to just keep it simple. Here are a few examples:

     – Do you feel you have the resources and tools you need to perform your job effectively?

      –  How could we make the best use of your interests/talents in your current role?

      – What aspects of your job do you find particularly challenging?

      – Are there any functions or processes you think need to change to help you better perform?

How Can Competencies be Measured?

Aside from the questions having a numerical basis (e.g., On a scale of 1 to 5, how would you rate Tom’s ability to perform under pressure? or On a scale of 1 to 5, how responsive has Mary been in completing her reports in a timely basis?), what about those questions that are subjective, such as level of patience, collaborative style, etc. How exactly do you measure these things?

They can either be measured by OTA (out of thin air) or crazy numerical formulas. The former is based on a sampling of past cases that highlight a person’s characteristics or skills. Bill’s team members work in a cooperative fashion. The metric of cooperation is then incorporated into the evaluation form. Joan serves her customers in a fast and friendly fashion. Speed and friendliness are now used as measurements on the form.

Using crazy numerics has its share of problems as well. Even though it is more objective and analytical, the variables used can be irrelevant or can skew the results. If using a software package that requires a database of traits and regressions to envision what is required for success, it may result in a prototype that may be hard to find. And HR will be hard pressed to develop a job requirements description to fill positions.  Certain attributes should never be used, such as age and geographical background or other nutty factors. No two people share the same level of competency or strengths, so don’t be limited in what you require for a particular position. Looking at potential cannot be overstated.

Identifying and Leveraging Strengths

What exactly is a sufficient number of competencies? And how much time should your employees devote to enhancing these competencies? Consider the most important competencies and prioritize them. The approach is to discover the strengths of each individual and to create approaches to leverage those strengths.

It will be useful to reference a whittled down competency list to identify key people with certain strengths and use this information for better job descriptions (for future use) and for the evaluation process. In fact, to cut down the whole review process, perhaps use a rating approach of develop, stop and continue to gain a more meaningful discussion with the employee.

Finally, I mentioned before that the evaluation process should not include a discussion of a raise or bonus. Why? Once a number is exposed, the employee may tune out the reviewer completely or begin to argue. This will result in a complete waste of time and effort. Your goal for the evaluation process is to benefit the company by benefiting your people.

About Steve

Steven Sacks is the CEO of Solutions to Results, LLC, a consultancy that specializes in helping individuals, firms and organizations meet the challenges of communicating with clarity and purpose. Visit his website at