How To Evaluate Employee Performance: 10 Proven Techniques

How To Evaluate Employee Performance: 10 Proven Techniques

Leading an employee performance evaluation, also known as a performance review or performance appraisal, is like giving a report card to grown-ups.

A performance evaluation is a snapshot of an employee's performance over a period of time. It’s a formal process that celebrates accomplishments, quantifies the value an employee brings to the company, creates a feedback loop for future improvement, and motivates employees to keep growing.

That’s the intent, at least. But employee performance reviews don’t always live up to the hype. A survey by consulting firm WTW found that only 1 in 4 North American companies (26%) feel their performance management systems are effective.

The reality is that assessments aren’t always valuable and they can generate anxiety for everyone involved—including managers who may or may not have been trained to lead these discussions.

However, if you get the evaluation process right, it can be an important pivot between an employee’s day-to-day efforts, their impact on the organization, and their long-term aspirations. “Progress toward career goals” is the strongest motivation for employees to keep learning.

In this article, we’ll review a number of different techniques to help your employee evaluations run smoothly:

  1. Set clear expectations from the start
  2. Give employees more frequent feedback
  3. Use a performance appraisal form for consistency
  4. Solicit 360-degree feedback
  5. Tap into self-assessments
  6. Recognize and reward high performance
  7. Address performance issues as soon as possible
  8. Close gaps with a performance improvement plan
  9. Build on existing employee development plans
  10. Underscore your decisions with quantitative data

1. Set clear expectations from the start

Clear expectations help employees move forward with confidence because they understand what success looks like—for themselves, their team, and the organization as a whole. And yet, less than half of employees (48%) know what’s expected of them at work. This confusion can drag down employee engagement and motivation.

To help clarify employee expectations:

  • Define job roles and responsibilities. This includes a job description, the specific tasks and deliverables they need to produce, and their position within the team.
  • Set targets for work performance. On a regular basis (i.e., annual, quarterly), work with employees to set goals and objectives that are specific, measurable, achievable, relevant, and time-bound (SMART).  
  • Establish realistic key performance indicators (KPIs). KPIs are the metrics used to track progress toward goals and objectives. However, only 21% of employees strongly agree that they have performance metrics that are within their control.

When employees have a clear understanding of what they need to accomplish, they can more readily adapt as circumstances change and they can stay better focused on the outcomes they’ve committed to.

2. Give employees more frequent feedback

Performance review cycles are typically done on an annual basis, but for many employees that isn’t often enough. One survey found that 63% of workers want more “in the moment” feedback on their performance. This desire is particularly strong among millennial and Gen Z workers, who want input that will help them reach their goals and move forward in their careers.


Instead of waiting for an annual review, create an employee feedback loop that has both purpose and a sense of momentum.

Consider a 90-day cadence. Quarterly milestones are increasingly common because a period of 90 days is short enough to stay focused but long enough to make measurable progress. You can use this regular opportunity to discuss performance, track progress, and review longer-term goals to see whether adjustments are needed.

Encourage open and honest communication. Regular employee reviews can help you learn their thought processes and perspectives—if they feel empowered to share. Many of us have been conditioned to bite our tongues around the boss so the dynamics of two-way communication can be a challenge. When accepted with respect and an open mind, however, the insights you get can be powerful.

Provide positive and negative feedback. Giving constructive feedback isn’t just about improving performance, it’s also an important way to show appreciation and recognition for a job well done. Feedback should be specific and timely, so there’s no ambiguity about the work you want to highlight. It should also aim to help the individual employee improve—whether you encourage them to do more of the same or offer suggestions that may help them excel next time.

Take the sharpest sting out of performance improvements. Feedback delivered during a formal evaluation shouldn’t come as a surprise, particularly if it can impact an employee’s compensation or promotions. But we’re wired to avoid conflict and that can lead managers to dodge the emotional charge of coaching employees and holding them accountable. More regular feedback—with documentation to feed into a formal review later—helps get to concerns more quickly and diffuses tension that can otherwise build.

3. Use a performance appraisal form for consistency

A performance appraisal form is a document that’s standardized across a department or company for use as part of employee performance evaluations. It typically incorporates a numerical rubric or another rating system as well as specific feedback and examples collected during the review cycle.

A performance appraisal form is a template that’s often built around core competencies, values, and behaviors that have been prioritized across the organization. It might include sections on:

  • Job performance
  • Quality of work
  • Skills and competencies
  • Reliability
  • Initiative and creativity
  • Interpersonal communication
  • Advancing diversity, equity, and inclusion
  • Cooperation and collaboration with others
  • Overall contribution

The form may include sections on goals and objectives as well as professional development, but these more individualized sections can also be pulled into a separate employee development plan.

4. Solicit 360-degree feedback

For a more complete view of an employee’s contributions, draw on other sources of feedback—not just your experience as their direct supervisor, but also their peers, colleagues, subordinates, contractors, and the customers or clients they interact with.

This more holistic view of performance and behavior can provide valuable insights you might otherwise be blind to, revealing both strengths and areas for improvement such as how the employee communicates, solves problems, leads, and collaborates.

360-degree feedback can be difficult to implement without company-wide buy-in. That’s because comments should be anonymous in order to encourage honesty, and people should be given guidelines—even training—on how to write effective and constructive feedback.

5. Tap into self-assessments

An employee self-assessment, also known as a self-evaluation or self-appraisal, is when an employee takes a critical look at their own performance as part of the performance evaluation system.

A self-assessment typically follows predetermined criteria and performance expectations, like a performance appraisal form or employee development plan. It’s a chance for the employee to consider their recent accomplishments, challenges, strengths, areas for improvement, and other matters they want to raise as part of the review process.

An employee may also want to reflect on:

  • Whether they’ve made progress on their goals—and, if not, what hurdles they ran into
  • Skills or knowledge gained and how they can be leveraged going forward
  • Informal feedback the employee has received from others
  • How they’ve excelled over this review period and how they can carry that momentum forward
  • Additional support or resources that would help them reach their goals

Incorporating self-evaluation into this process encourages ownership and personal accountability. It also creates a foundation for a more honest and effective discussion between you and the employee. They may come prepared to highlight things you’ve missed, to add context to a situation, or to provide a different perspective on points you’ve raised.

6. Recognize and reward high performance

Performance reviews are as much about recognizing and celebrating an employee's achievements and strengths as they are about motivating improvement and identifying top performers.

The information gathered as part of the employee performance review process often feeds into a company’s overall talent management strategy, which can in turn influence promotions, succession planning, training and development, and compensation and benefits.

Use the appraisal process to foster a culture of recognition and appreciation. Acknowledge and reward high-performing employees on your team through bonuses, awards, or public recognition. Honor individual milestones and achievements with certificates or team celebrations.

7. Address performance issues as soon as possible

Delivering critical feedback is never easy, but if employee performance falls short of expectations you should address it promptly. An annual review or quarterly check-in should not be the first time an employee hears that there might be a problem.

When giving constructive feedback, keep the focus on the situation and how to improve moving forward. As an example, let’s say a member of your team consistently fails to respond to emails or instant messages in a timely way:

  • First, provide specific examples of important messages that had a delayed response
  • Explain the impact the delay had in each situation, such as creating confusion or misinformation
  • In a respectful way, ask whether there’s a reason for the delays and ask what you can do to better support the employee. This opens the door for them to offer possible solutions—for themselves or the team as a whole—such as training, software solutions, or administrative support
  • Close by highlighting the positive impact of resolving this concern, such as improving the team’s efficiency

In your conversation, provide clear feedback and guidance on how the employee can improve as well as your expectations. In your own records, document any performance issues or interventions for future reference.

8. Close gaps with a performance improvement plan

A performance improvement plan (PIP) is a formal document that highlights specific areas where an individual employee isn’t meeting performance standards. A PIP provides a guide to help them make progress. While PIPs can be part of employee development, they’re most often used to help employees transition into new roles or to address ongoing work performance issues.

In any circumstance, think of a PIP as an educational tool that realigns an employee’s performance with an organization’s expectations. When followed, performance improvement plans can help employees:

  • Meet or exceed job requirements
  • Access the support and guidance they need to succeed
  • Move toward promotions and advancement opportunities
  • Bring a stronger sense of confidence to the employee’s work

That confidence and clarity can have an outsized impact on an employee’s position in the workplace, with the potential to increase productivity, improve morale, and keep talent working with the company over the long term.

Performance improvement plan

9. Build on existing employee development plans

Performance assessments and talent development move hand-in-hand toward a common purpose: to help employees succeed while building a sustainable and competitive business. Part of this process is creating an employee development plan for team members—something that can be a great foundation for the evaluation process.

An employee development plan is a document that sets out a highly individualized career path. It may include:

  • The employee’s goals and objectives
  • Learning and development opportunities
  • Metrics to help track progress
  • An implementation plan

Regular check-ins are an opportunity to spur accountability and self-assessment, track progress, address challenges, make adjustments to the plan, and encourage continuous learning.

Regular check-ins also mean employee performance evaluations don’t need to start from scratch. There’s already a plan in place—use the review process to keep it moving in the right direction.

10. Underscore your decisions with quantitative data

There are two types of data: qualitative and quantitative.

  • Qualitative data is subjective, often describing qualities or characteristics. Techniques such as 360-degree reviews and self-assessments generate this kind of input.
  • Quantitative data is measurable and can be captured in numbers and values. This might include training modules completed, sales figures, projects delivered, customer satisfaction scores, or error rates.

You need both types of data when evaluating employee performance, but the objective, quantitative metrics provide a fact-based and less personal foundation for discussion.

Ideally, collect and review data on a regular basis to inform check-ins with employees as well as decisions about promotions, training, and other initiatives. Data visualization can be a valuable way to monitor this information and watch for patterns, trends, and anomalies.

Quantitative data

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Learning how to evaluate employee performance is an important skill that can help your team challenge themselves and perform at their best. Establish a process that sets clear expectations, uses specific data, and prioritizes fairness, consistency, and transparency. Incorporating these techniques can help you create a stronger and more robust team.

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Author Spotlight

How To Evaluate Employee Performance: 10 Proven Techniques
Amy Sept
Writer & Editor

Amy Sept (@amysept) is an independent writer, editor, and content marketing strategist who’s dedicated to helping businesses of all sizes navigate the future of work. As a Canadian military spouse and slow traveller, she has a lot of hands-on experience with remote work, productivity hacks, and learning how to "go with the flow."

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