Why is it important to conduct Performance Review regularly?

Published by
Editorial team
February 19, 2021

43% of highly-engaged employees receive feedback at least once a week. After reading such statistics the blow is clear that the term "review" is one of the most crucial words in the employee's life. 

One of the most significant reviews for a company is conducting Performance Review; it is observed that conducting a performance review on a regular basis increases employee engagement, reduces turnover, and increases company productivity. 

Performance Reviews are given special importance because it creates a win-win situation for both; employees and employers. It helps to understand many aspects in detail and communicate freely about prevailing hurdles or possible hurdles. 

In a study, it was found that 72% of the companies conduct reviews. Performance reviews can benefit the company and employees in multiple ways! To enjoy the ripe fruits of performance review; only knowing the definition of it is not sufficient; one must understand in detail about the concept.

In this blog, we are eager to discuss the core of Performance Review, its significance, parameters to conduct it and of course some pro tips for conducting a successful performance review. 

What is a Performance Review?

Performance Review means analyzing and reviewing the performance of an employee - it is more like an assessment. It involves understanding the work process of an employee and also keeping an eye on their day to day goals. 

In the review process, the company shall also focus on hurdles that a particular employee is facing in completing their goals. 

Performance reviews are also called performance appraisals or performance evaluations.

It is not carried to disappoint any employee or keep scolding them, it is conducted to make the employees understand how they are working, how they can improve, how they can move forward with other tasks, how they can contribute to the company in a better way? 

This report shows a mirror image of individual work-life and the best thing about performance review is if the managers are applying the process of review; employers will be able to keep a note of high performing employees, rectify the issue before it becomes troublesome, communicate about the expectations and also help the employee to perform well. 

It also keeps both of them on the same page and avoids any kind of miscommunication and makes the performance of each employee show the high graph. 

Why is Performance Review necessary for the companies?

Whether the organization is big or small, the performance review is necessary for every company irrespective of the size of the company. 

With the help of a performance review, it really becomes easy to be at par with the employees. 

In absence of performance review, the company won’t be able to note the significant information like: 

  • The daily goals of an employee
  • Understand the problems they are facing 
  • Detect the communication gap 
  • Develop and strong relationship with employees
  • Make them feel a significant part of the

3 Reasons why Performance Review is necessary

1. Improves Retention Ratio

Good employees are hard to find and harder to retain. If the employees are well communicated about their progress or are guided in the context of performing better it can be easy to retain them in the company. 

Performance Review helps to give satisfaction to the employees and they shall feel that they are an important part of the company.

In today's time, it is comparatively difficult to keep employees loyal towards the organization, as other companies are already having an eye on the talented employees. Therefore via Performance Review, you can identify the employees who are contributing to the company and can develop a good relationship with them. 

2. Preventive Measures

It becomes easy to combat the hurdles. While discussing the performance employees are asked about the hurdles faced by them or probable hurdles that might arise. In such a case the company can work on the situations that might turn out to be a barrier. 

If the problems of employees are solved or are taken note, it will gain their trust. It will make them feel that their issues are being solved by the organization. 

Performance Review includes discussing the complaints of employees, barriers faced by them well completing their task and the difficulties experienced by them. 

3. Overcome Communication Gap

While conducting the Performance Review, both the parties i.e. Employees and Employers are supposed to communicate freely. They can talk about the perks and benefits as well as the problems faced by them.

This helps to bridge the communication gap and employees can talk freely about their experience, work plans and other things. 

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What should be the parameters for Performance Review?

Following should be the parameters for conducting the Performance Review:

1. Regularity:

It includes considering the attendance, punctuality, leaves, productive working hours and how well the employee is maintaining regularity in completing their task.

If the employee is working regularly without taking too many leaves or without being constantly late; the employee should be appreciated and should be motivated to keep the regularity intact for the upcoming tenure.

If the employee is not regular or not maintaining regularity in completing the work then he should be explained that this will impact his performance negatively and why he should maintain regularity. 

A polite approach should be used to do so. Henceforth the employee can understand your perspective and may act positively upon it. 

2. Goal Setting:

Goal Setting is a personal agenda and it will highly differ from person to person. It is necessary to understand about goal setting in a dynamic manner as no static definition or approach of goal setting will help to have a healthy relationship with the employee.

While conducting a performance review, the employers should ask about the next or future goals of the employees and shall understand whether the workflow is surpassing their capacity or they are working under capacity.

Goal setting can also put light on how employees should decide their goal which can help them to be more productive.

Communicate specifically and clearly about the goal-setting with the employees and help them to progress with proper guidance. Also under this parameter, the company can clearly mention their expectations from the employee and lay responsibility on him.

3. Coordination with Superiors and Subordinates: 

Under this parameter of Performance Review, one shall openly discuss employees behaviour with his seniors and how he is dealing with his subordinates.  

If any employee behaves rudely or has an unprofessional approach towards any person in the organization then he must be made aware of it and explain that such behavior shall not be entertained. 

If the employee is keeping well with everyone in the company, appreciate their gentle behaviour and help them to set an example.

Also, the flow has to be from both sides; employees can brief whether they are getting enough support from their superiors and department heads. Whether his subordinates are working professionally or not. 

If he is facing any clashes with either of them, he should share it without any fear. 

The main performance analysis is done on the basis of these 3 parameters. However, the company can add different parameters based on their requirements. They can include parameters like; leadership quality, communication, the contribution for the company etc. 

Tips to keep in mind while doing a performance review:

Performance review has many perks and those perks can not be overlooked but the entire concept of performance review might go in vain if certain points are not kept in mind. This is applicable to both; employees and employers.

It is a systematic process and should be followed properly to yield maximum benefits from it.

- For Employers:

Employers should keep certain points in mind and should act wisely on them.

1. Explain clearly How you will evaluate the performance?

2. Give the format of performance review prior to the meeting.
3. Adapt an unbiased approach.
4. Don’t only rely on someone’s review about a particular employee.

5. Keep personal experience aside and don’t let it impact the performance review. 

6. Give proper and practical guidance to the employees and don’t just randomly give advice.
7. Collect the data accurately, data about the work done by an employee and his performance. 

8. Don’t compare one employee with others.

9. Never give fake appreciation. 

- For Employees:

Employees are also expected to keep certain things in mind and respond accordingly.

  1. Never pinpoint the blame on a company or superior without evidence. 
  2. Take criticism positively and respond politely.
  3. Take performance review as part of your growth and don't get moralized.
  4. Document the things you want to discuss with a company in the proper format. 
  5. Be specific when you are discussing the problems faced by you. 
  6. Don’t take Performance review lightly, it has a lot of significance.

→ Conclusion

Performance review should be among the priority tasks of the company. When performance reviews are put first, the entire company can benefit. 

Conducting Performance Review on regular intervals is highly recommendable, as it will be helpful for the employers and employees; both. 

It will help to streamline the goals of an individual with the goals of the company and in this way it will be easy to keep track of an individual's activity and keep the vision of the company intact.


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