Miles To Go
Volume 3 | Issue 4 | Fall 2016
The Importance of Delivering an Effective Annual Performance Review
As the end of the year approaches, executives tend to focus on closing the year with strong results and finalizing budgets for next year, but it is important to also dedicate time to prepare and deliver meaningful performance reviews to your team. While performance reviews in some companies are giving way to more organic, continuous feedback processes, they remain an important aspect of coaching and executive development. According to a Gallup study of over 65,000 employees, those who received strengths feedback had turnover rates that were 14.9% lower than for employees who received no feedback. However, it is not just positive feedback that has an impact on employees – in a survey conducted by Zenger and Folkman, 92% of respondents agreed with the assertion that “negative (redirecting) feedback, if delivered appropriately, is effective at improving performance,” thus confirming that people believe constructive criticism is essential to their career development.
Performance reviews have significant implications on followership, retention, engagement and overall morale of employees. The ability to deliver feedback in a constructive way (so that your counterparty is motivated) is a key leadership trait. Done effectively, performance reviews have a strong underlying process and the collection of rich and relevant data that can be delivered in a holistic manner. This is about treating each member of your team as real human beings and not simply people who need some sort of fixing. It should be delivered in a way that he or she will want to get up the next morning and apply the feedback by developing a new skill or trying something new and different.
As you prepare for feedback conversations, these behaviors will increase your ability to be a superb developer of talent going forward:
Define What Success Looks Like
The biggest failure in performance reviews is often the substance of the review. For instance, do you know what you have agreed to measure the person against this year? Most executives cannot answer this because it either doesn’t exist or, if there is an outline, it is often vague and of little use. You can avoid this by outlining what “outstanding performance” looks like for the year ahead for each of your direct reports and discussing it with them. Don’t be afraid to be granular around what the “gold star” for the year looks like – it can be business / function, project or people metrics, engagement scores, etc. You want to outline this so that when you sit with the executive at the end of the year, you are aligned and they know exactly what they needed to do in order to get the gold star.
One of the keys to performance reviews is to have a detailed and transparent discussion around the criteria someone is being measured against. This conversation should not be a surprise! This means you need to turn that definition of “gold star” performance into a dashboard that you continuously measure progress against and engage around the content. It can vary based upon your rhythm with the particular direct report, but generally, you would have at least monthly engagements with him or her that specifically address the expected outcomes for the year. In these sessions, you can now become a coach and mentor—you can jointly problem solve, remove obstacles, or simply provide support. If performance is off track in any area, you can be alerted to this early, understand why it is off track and provide any support necessary to get things moving in the right direction again. Now you have an outline for the year, with regular checkpoints to measure and support progress against. The more difficult part is taking the plan and translating it into key areas of long-term development so it is not simply a yearly execution plan. This is where you go from a process to content. You should break down each of the areas of the process and think about the behaviors and competencies associated with delivering those.
Deliver Feedback with Content
Giving credible and effective feedback requires you to prioritize it as one of your management habits. If you try to wing it, your counterparty will see right through you and will subsequently believe he or she is not being invested in and developed. Throughout the year, you must build a management habit around collecting content, which is necessary to provide feedback and coach someone in a meaningful way. Most executives try to provide feedback with a few observations and / or anecdotes but no real content. This is an area where you can lift your game immediately. When you have interactions with various members of your team, the key is to catalogue your own observations related to their performance across an array of different situations. Many of the situations will line up to your broader and longer-term performance goals for the person. And when you have catalogued your observations throughout the year, you will have a lot of content for a feedback discussion. You can track these observations through handwritten notes, but an easy way to develop the habit around this is to use an app on your phone / device (TMG’s lloop application is now available at iTunes Store and Google Play).
When you observe members of your team, always capture the context of the situation (e.g., leading a conference call with their peers on topic ‘X’) and then reflect on areas where they excelled and one area that could be improved upon to increase their effectiveness. You should communicate the area of improvement in a forward-looking and positive manner. This is a motivating model; it treats the direct report with kindness and respect while providing him or her with beneficial positive and critical feedback to enhance his or her performance. It also has context and is specific to a situation so you are not making sweeping generalizations about them.
- Define what success looks like for each of your direct reports on an annual basis
- Translate that content into a dashboard with key streams of work that need to occur in order to meet expectations for the year
- Set up monthly check-ins that focus on progress made on the plan; during these meetings: ask questions, provide support, jointly problem solve, remove obstacles, provide resources, provide air cover, help them manage upward or across, etc.
·In your monthly sessions, adopt a management habit of giving feedback with content (collect data through your interactions with the executive across different situations)
·Always treat the executive with respect when providing feedback—affirm what is working, use examples and include a performance recommendation attached to a forward-looking statement (e.g., next time you do X, why don’t you try doing Y or Z as I believe it will take you to the next level)
·Look for ways to frame their experiences within the context of their own development (e.g., leading a cross-functional project that will teach them to manage organizational stakeholders, to influence their peers, to manage to an outcome, to make tradeoffs and deliver an outcome and so on)