5 Ways to Make the Annual Review Process Less Painful

Last week, I wrote an article for Fast Company magazine’s on Bottom Line blog, which is based on my next book, People Tools for Business (out this September). It’s about my approach to the annual review that many employers and employees face each year, and how I’ve learned how to make this usually dreaded process a positive experience. I’ve re-published it here on my blog. Enjoy!

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5 Ways to Make the Annual Review Process Less Painful

I’ve supervised hundreds of employees, and I can say without a doubt that one of the most difficult parts of being a manager is the dreaded annual review process.

To take the fear out of this necessary process, I’ve developed a unique approach over the years that has helped me transform this annual event from one that I loathe to one that I look forward to.

Here are five actions that can help you take the “dreaded” out of annual review:

1. MAKE IT A TWO-WAY REVIEW

Why should we think of the review as being only about the employee? Your employees are your coworkers. Every one is a crewmember on the same ship, headed toward the same destination, and seeking the best possible performance for the company.

The most important shift I’ve made with my annual review has been making it a review of my own performance as well as my employees. I always ask them how I, or the other managers, can assist them to perform better.

If my employees aren’t performing as well as they can, perhaps they lack the proper tools or training. Maybe they don’t feel appreciated and, as a result, are not as involved as they might be.

Tools, training, and the expression of appreciation are the responsibility of the employer, not the employee, and the annual review is a great way to find out how you can do a better job of supporting your team.

2. DON’T WAIT UNTIL THE END OF THE YEAR

Keep your employees up to date on how they are doing during the year, rather than saving up your feedback for the annual review.

Offer approval to encourage them and suggest course corrections to help them focus on what needs to be changed. If you have properly helped your coworkers throughout the year there will be no unpleasant surprises for either of you during the annual review.

3. DON’T PROCRASTINATE

When it’s time for the annual review, make sure to conduct it within a week or two of your employees’ anniversary date. It’s not fair to your team to delay information which is important to them and to keep them walking on eggshells, waiting for the knife to drop. And you don’t want to skulk about the office hiding from someone.

4. ENCOURAGE SELF-REVIEW

Ask each person being reviewed to evaluate him or herself, encouraging them to write down their accomplishments of the past year and goals for the coming year. Not only does this help your employees learn the valuable skill of self-assessment, it also shows how much you respect and appreciate their opinions.

Before or during the review you can also ask the reviewees what salary they think they deserve, and use their recommendations as a guide.

5. ADD A BONUS

If a member of your team has made an outstanding contribution to the company that saves time and money, increases profits and productivity, or improves the working conditions in the office, consider awarding them a one-time bonus. This way, the annual review can be just as much about rewarding performance as it is about offering constructive suggestions on how to improve.

Why shouldn’t you want to encourage the best performance possible, and pay fairly for that performance? If all of your employees felt unfairly compensated and failed to show up Monday morning, your business would instantly disappear. Each of them is there because they are good at what they do, and they could always find a position somewhere else.

Alan