Performance reviews are not the most fun undertaking for managers or their staff. According to the Society for Human Resource Management, although employees want to receive feedback on their performance, a study by Gallup found that nearly 30 percent of those polled were so upset by negative feedback they began looking for a new job.

For employee performance improvements to occur, a manager has to point out where there are less than stellar results. How can a manager deliver this type of feedback so that it is a positive and constructive experience for everyone involved?

This article explains what a productive performance appraisal looks like and provides tips to managers who want to build stronger relationships with their reports. That way, feedback is more likely to be well-received, applied, and lead to higher productivity.

Why Conduct a Performance Review?

Performance reviews provide useful feedback about job performance. They should facilitate better working relationships. They also provide transparency by creating a historical record of performance and professional development. 

Reviews are also an opportunity for a manager to correct team members' behavior and improve their team’s productivity and performance. Without change, there can be no improvement.

Performance Review Models

Because collecting feedback and conducting one-on-one meetings is time-consuming and gets in the way of day-to-day operations, many companies opt for an annual performance management model. Tradition thinking has been that once a year is enough for an organization-wide staff performance review. But, is it?

The recommendation from the SHRM is to ditch the annual performance review and have more frequent, real-time feedback check-ins. For example, PricewaterhouseCoopers uses a real-time feedback model that incorporates data collected over time from reports, surveys, and collaboration tools. 

Input is sought from peers, managers, and subordinates, and metrics are tracked over time to monitor progress. If the performance review process is continuous between reports and managers, performance feedback becomes normalized and less of a threat. If results are realized due to the feedback, this builds a stronger relationship between managers and employees based on respect and trust.

Regardless of the performance review frequency or model structure, managers still need to conduct a face-to-face feedback session. So, what is the best way to conduct an effective performance review? Here are some suggestions.

1. Invite Feedback

We all know that the best leaders listen well. So, it’s important to view the performance review meeting as an opportunity for both parties to learn more about each other, their opinions, and their experiences. 

It’s not just a conversation about poor performance, it’s a conversation about how the relationship between manager and employee can be strengthened so that communication becomes easier and more frequent (Price Waterhouse could be spot on!).

For example, how does the employee feel about the current performance review model? How could it be changed? This question could be answered through a staff survey rather than in individual interviews, but it needs to be answered. If the process is working for no one, then why do it?

The manager could start out a performance review meeting by asking the employee to give them an example of what is going well for them and what is not going so well in the workplace. This forces the employee to think of scenarios and gives the manager a better idea of where the employee is coming from, their level of employee engagement, and what they are experiencing.

2. Be Prepared

As a leader, you should take an interest in your direct reports on an ongoing basis. Even if your employee performance review conversations only occur once a year, you should have regular feedback sessions with staff and make notes of key events. That way, you will be prepared for the performance review and have a narrative to refer to when making your points.

Employees should also be prepared for their performance review. So, inform employees in advance what topics you would like their opinions on. Ask them to complete a self-assessment, and give yourself time to review it before your meeting. A self-evaluation by employees can reveal issues that should be addressed.

3. Be an Active Listener

It’s never a bad idea to seek training on active listening and leader communication. There are basic guidelines; for example, give the person your full attention and block out distractions like phone calls and notifications. Following these pointers may seem pedantic, but it’s the little things that leaders do that earn the respect and trust of their reports.

Leadership and cultural training can hone listening skills. There is an art to asking questions and conducting effective feedback sessions. We all have biases that we are unaware of that cause us to make assumptions or judgments, and cultural and interpersonal training can help us to become aware of those tendencies. It is also important to pay attention to verbal and nonverbal cues and to interpret them correctly.

4. Offer Support, Not Criticism

Positive feedback is easy to deliver. But how can a manager deliver negative feedback without the person wanting to dive out of the door and turn in their resignation? 

First of all, it’s important that a person becomes aware that they have performed poorly if that is the case, but first determine why it happened. There may be personal or underlying issues that need to be addressed.

Second, negative feedback doesn’t have to be viewed as criticism; it can be viewed as advice. It is the leader’s role to understand the position of the employee and guide them to a better place if they can. There is also the concept of team effort. Whatever the issue or problem, the employee does not have to tackle it on their own. You are there to help them, and so is the team.

5. Take an Active Role

When a specific problem has arisen, take an active role. Ask your report what you can do to help them in the future and what they can do to avoid the issue happening again. For example, let’s say a product manager promised to deliver a client some software by a certain date. The client moved up the due date, so the product manager dropped some important features to meet the new due date without informing the client. The client was rightly unhappy.

In this case, as a leader, you could offer to have a meeting with the client and the product manager to understand exactly what the specs were and how to deliver an updated product with all the specs at a discounted price. Meanwhile, you can point out to the product manager that they should have communicated with the client that certain features could not be included if delivery was expected at an early date. 

This way, you are providing an opportunity for the product manager to learn how to better manage clients rather than penalizing them for the mistake and doing nothing to help.

6. Set One or Two Achievable Goals

Setting attainable goals is a must, but have the report suggest some or decide which ones to choose with your guidance. Pursuing those goals has to be their decision.

Set expectations that are reasonable. Select only one or two achievable goals; any more is impractical. For example, an employee's goal could be learning new competencies, completing a new project, mentoring a new staff member, or improving their time management. 

Create a template for an action plan with areas of improvement and monitor progress over the course of the year. Discuss progress in interim feedback sessions so that the person continues to be motivated when it comes to goal-setting.

7. Always End With a Positive Note

When delivering feedback that you hope will change behavior, always end on a positive note. It can help to meet in a less formal setting so that you can change the conversation once you have discussed the business at hand. Perhaps have a coffee with the person or lunch where you can discuss other topics also. The issue can always be raised again in a more formal meeting for that review period, but it might already be resolved by then.

It’s All About the Relationship

Fundamentally, how valuable performance evaluations and their effect on retention depends on the relationship between a manager and their report. If the relationship is strong, whatever feedback is shared will be accepted as constructive feedback and not perceived as threatening or a criticism. 

Build strong relationships with peers and reports by conducting regular feedback sessions, informal and formal. In feedback sessions, listen, encourage the employee to be proactive, offer support, and act as an advisor or mentor rather than a boss.