Performance Appraisals for Small Business – Why You Need To Be On Board

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Performance appraisals isn’t a dirty phrase, but there is a negative stigma attached to the performance appraisal, (or employee evaluation or review) process.  This stigma is felt by both supervisors and employees, but it doesn’t have to be that way.  Employee evaluations are a regular part of doing business.

In fact, many businesses both large and small use employee reviews to evaluate their employees on a regular basis.  But where does the feeling of dread  come from when it comes to the evaluation process?

We’re all busy and some supervisors take the position that the process is a waste of time, or they don’t understand the value in completing a “form”. Other supervisors view the appraisal as if it
Performance Appraisalwere a written warning; meant to be used to “scold” or reprimand employees who may not be producing quality work. 

Employees view the process as an opportunity for their supervisor to be nit picky and to focus on minor issues or problems and not the “real” work.  Both viewpoints are extreme and don’t take into account the importance for you, the employer to be able to discuss employee performance over time including employee strengths and weaknesses, develop goals, and reinforce a job well done.

So, how do performance appraisals for small business benefit the employee and your company?  Simply put, employee appraisals allow you to monitor your employee’s performance, and measure their productivity against your business goals; reinforce strengths, and identify and provide support for weaknesses in performance.

Employee evaluations gives your employees an opportunity to sit down with you and discuss their roles, their accomplishments and challenges during the review period, and get positive reinforcement from you.  In cases where performance is a problem, the appraisal process is a tool to help your employees better understand their strengths and weaknesses and develop a game plan towards improvement.

Be careful not to use the performance appraisal as a way to communicate poor performance for the first time.  Any issues with performance should be discussed with your employee well before the performance review conversation so that there are no surprises for your employee.  Using the appraisal process as a tool to communicate your displeasure with performance just reinforces the performance appraisal process as a negative practice for both you and your employee.

On the other hand, the employee evaluation period is a great time for you to discuss with your employees their personal goals, and share their career development and training interests.

Performance appraisals can make it easier to evaluate your employees for possible promotions.  Money isn’t as free flowing these days for many businesses and budgets are tight.  But when there is an opportunity to grow your staff  based on increased responsibility, you’ll want to have a concrete way of measuring how consistently your employees go the extra mile.  The performance appraisal then becomes a document that reinforces that opportunities like promotions are not granted arbitrarily but based on concrete job performance that has been documented over time.

Employee evaluations are an important tool for businesses of all sizes and should be a permanent part of your employer toolkit.

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