Are your managers and employees struggling to see the benefits of Performance Development Reviews (PDRs)? Is there a collective groan when it approaches annual appraisal time? Do you generally feel you aren’t getting much out of the reviews? Are you struggling to find the time to hold them at all? If the answer to any of these questions is yes, it could be time to evaluate your performance development review process.

Performance reviews can bring great benefits, but only when they are done right. This blog post explores the importance of performance reviews, and some helpful tips for how you can design an effective process – making annual appraisal time a positive time!

Why are performance reviews important?

Performance reviews are important because they set aside clear time where employees and managers can sit down to discuss performance and set goals. Providing positive feedback on performance and setting clear goals helps employees feel motivated and engaged because they know their hard work is recognised and they have something to work towards.

On the other hand, performance reviews also help you to identify anyone who is underperforming so you can put strategies in place to improve this.

Performance reviews provide valuable data that helps you to understand how your business is performing as a whole. This allows you to identify skills gaps, pick out top performers for succession planning, and identify areas of development, so these can be improved.

Key benefits of effective performance reviews

Well-designed performance review processes can help you to cultivate a high performing workplace culture. Here are some of the key benefits of a positive PDR experience:

– Engaging and motivating your employees – leading to increased performance.

– Providing you with valuable data – so you can see what is going wrong and what is going right!

– Promoting employee voice by providing an opportunity for two-way feedback.

– Increased job satisfaction resulting in higher productivity and better working relationships.

How can you improve your PDR process?

With 95% of managers surveyed by Culture Amp stating they were dissatisfied with their current performance process, it is more important than ever to refresh your current practices and get everyone on board. Here are some things you can do to improve your process and gain buy in:

– Involve your managers in designing the performance review process and accompanying documents.

– Make the process transparent, fair and accurate. Create clear stages for your performance review process and ensure there is regular and transparent communication at every stage.

– Use appropriate scales to measure performance that don’t skew the data. Research has found that scales using the word ‘average’ were generally positively skewed, whilst scales using the word ‘expectations’ were not.

– Be mindful of central tendency, the tendency to select the middle option from a range of choices. Designing scales that have 4 options rather than 5 or 3 can help prevent this.

– Empower your employees by setting SMART goals that are aligned to your business objectives. Aligning individual goals to business goals can increase productivity by up to 56%!

– Finally – don’t leave performance reviews on the shelf to gather dust! Performance reviews should be regularly referenced in 1:1s and progress measured so they have an ongoing purpose.

If you think your performance review process needs a refresh, or you are thinking of introducing one, get in touch with Hallidays HR today for a range of resources and support.