How to Build a Great Employee Performance Evaluation System

performance evaluations

Performance evaluations allow organizations to assess their employees’ performance and contribution to the company to develop a productive workforce. However, most managers don’t take performance evaluations seriously as they don’t want to criticize the employees with whom they are working closely. Nevertheless, the benefits of performance evaluations outnumber the challenges. Performance evaluations are the standard for performance measuring, feedback guidelines, disciplinary policies, communication policies, etc. Still, no one is excited to acknowledge it. Many performance evaluation systems fail to boost employee performance and productivity. According to Gallup, only 14% of employees agree that performance evaluation motivates them to work better. This is because the performance evaluations deliver no actionable results.

With an effective and result-oriented performance evaluation system, you can improve your team’s productivity and performance by enhancing team communication, motivation, and overall growth. An adequate system helps you quickly figure out the best performing and worst-performing employees. 

How to build an effective performance evaluation system?

According to a Deloitte study, only 8 % of companies believe that performance evaluation effectively drives business value. Given these statistics, consider this step-by-step article for building your effective performance evaluation system. KloudLearn has specially designed this checklist to help managers and organizations to create a capable and robust evaluation system.

Seven tips for building a competitive performance evaluation system:

1. Evaluate your current performance system:

The first step towards building a result-oriented performance system is by figuring out your existing system. Consider the following things while reviewing your evaluation s system:

  • How regularly do you provide feedback to your employees?
  • How are your employees evaluated?
  • Are the employees progressing after performance evaluation?

Now, take a look at your organization’s objectives. What do you want your employees to achieve after their performance evaluation? What areas should your employees strive hard to achieve?

Align your performance evaluation with your organization’s goals and objectives in a way that doesn’t seem weird to your employees. 

2. Determine the performance measures for your employees:

To avoid bias in your evaluation system, set performance measures for your employees. According to Forbes, there are six types of discrimination that can interfere with your performance evaluations. To ensure any unconscious bias is not interfering with your employee’s performance, set up specific performance metrics according to each employee’s roles and responsibilities. 

3. Create a performance evaluation form:

Start creating your performance evaluation form by considering the following things:

  • Job knowledge, skills, and experience
  • Quality of work
  • Can-do Attitude and habits
  • Soft Skills
  • Team Performance
  • Leadership Skills
  • Ability to motivate others
  • Ability to provide feedback

You need to have different performance evaluations for various departments and job roles with varying metrics of performance. 

4. Allow your employees to review their performance themselves:

Encourage a sense of autonomy among your team members by distributing them their performance evaluations. Before providing your feedback, let them understand their strengths and weaknesses. 

5. Provide specific and relevant feedback:

Your robust and effective performance evaluation system won’t work until you are specific and relevant with your feedback. You can consider the following factors while delivering your feedback:

  • Always have your positive and negative feedback in balance.
  • Provide a clear improvement plan.
  • Make your employees clear about the consequences of their actions.
  • Avoid nonspecific and ambiguous feedback.

6. Set disciplinary and termination policies:

In some instances, even after regular performance evaluations and reviews, the employees continue to perform poorly. In such a situation, you need to have clear disciplinary and termination policies in action. These policies can consist of a verbal warning, written notice, or termination. 

7. Set up a schedule for evaluation:

Most of the companies carry out performance evaluations once a year. However, carrying out the evaluations semi-annually or quarterly will prove beneficial for your employees as well as your company’s overall growth. According to a report by the newswire, 63% of Gen-Z employees would prefer having performance evaluation processes throughout the year rather than once or twice a year. You need to decide the evaluation schedule and strictly meet the deadlines.

A performance evaluation system is a crucial part of your company’s overall growth and success. When incorporated correctly and effectively, it ensures accountability, credibility, fairness, productivity, promotes team growth and provides a sense of awareness in your employees. 

KloudLearn helps you better evaluate your employees with its robust and intuitive learning management system. You can quickly track your employee’s progress using pre-built analytics reports and interactive dashboards. Contact us to learn more about KloudLearn. 

The KloudLearn Team has put together a few best practices that you can implement right away to deliver engaging employee training. Click here to download a copy now and get started.

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  1. […] performance refers to performing your job responsibilities well. Organizations can measure the work performance of their employees based on numerous factors, including whether employees complete the assigned tasks on time and […]

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