Friday, February 01, 2013

SOP Friday: Employee Review Procedure (Quarterly or Annual)

One of the easiest things to do without is Employee Reviews. Don't do without!

We see our employees all the time, we talk to them all the time, and we give them feedback all the time. But that is not enough. It is important to have an occasional "formal review" for them. The process gives them a very clear message about what's important in their job, and feedback on how they're doing.

It is also a great way to build your team, shape your company, and help your employees advance in their career. But the only way it works is to divide it into two important and separate activities: Setting Goals and Evaluating performance.

If you don't set the goals, then the evaluation will be haphazard and have no clear context for the employee. For example, if you evaluate whether they've taken a class or passed a technical exam, you had better have set that expectation in advance.

Not Like School!

Remember when you were in school? Didn't you hate teachers who graded on material they didn't cover? Or pop quizzes? Or unclear expectations?

Employee evaluations should be a positive thing for everyone involved. That takes some work and planning. More than anything else, you need employees to see this as a positive thing. The interesting part is that they WILL see it that way the first time you do it. After all, they expect a positive review. They will get a piece of paper with your signature that says they did a good job. You're helping them build their portfolio for future jobs - even if they're not looking today.

And remember: People love information on how they can do their job better. Really. As long as it's delivered in a positive way.

The way to help employees "prepare" for the evaluation is to start with very clearly defined goals. Meet with them to get feedback and agree on the goals. Then, at the review, you can just check through the list and talk about each of them.

So don't think of the process as Us vs. Them. Think of it as us and us.

Setting Employee Goals

In a perfect world, you will set goals at the very beginning of the period (e.g, the calendar quarter). If you can, a little before the beginning is good. Just don't do it half way through the period.

You might do evaluations once a quarter or once a year. Just do something! We like to have one meeting in which we evaluate the last quarter and set goals for the next. Sometimes, based on the discussion, we have to finalize the upcoming goals a few days later. But we always show up to the evaluation meeting with proposed goals for the next quarter.

You Need A Form

I know this is a shocker for you. But you need a form. Here's a sample of the kind of thing we use:

Proposed Goals for the Quarter
 Position: __________

 Date: __________

 For Period: __________

 Employee: __________

 Position Goal: Provide excellent technical support to our clients while contributing to good relationships within KPEnterprises and between KPEnterprises and our clients.

 Position Requirements: At least one Microsoft Certification (any) Certification Goal: One Exam every six months.
Employee Evaluation Criteria: Scale: 1 = Lo / 5 = Hi
1. Certification Goals (Recommend Windows 2012. Any is okay.)
2. Overall quality of technical support provided to clients
3. Overall contribution to positive relationships within KPE
4. Overall contribution to positive relationships between KPE and clients
5. Five most important goals for quarter
• Be the project lead for a server install
• Consistently arrive at work or on location on time. Get to a 5!
• Mentor [a new tech] on the KPE way and how to be a great tech.
• Master [RMM tool] completely – Take a step up.
• Master PSA ticket entry and look for new ways to use features.
Miscellaneous Items of Note this Period:

Please note a few things here. First, most of these goals are pretty mundane. After all, there are no big surprises in what you expect people to do. Items 1-4 are part of the job description. Second, you can structure goals to help technicians reach their personal goals. For example, the goal to be a project lead on a server install will help a tech step up from "desktop" tech to "server" tech.

You will sit down with the tech and review all of this. Get feedback. Is there a specific goal the tech would like to add to the list (or remove)? Are the goals realistic? How many are left over from last quarter? If there are changes, you need to integrate them.

Once you have agreed on goals for the quarter, print up the page and give a copy to the tech. If you can arrange a time for the evaluation (at least pick a week).

Performing Employee Evaluations

The form for this is easy. Open the "goals" document and Save As quarterly review. Change the title and begin filling out the form.

We use a five point scale. This is a personal preference. You should use a scale with an odd number so there's one option right in the middle (neutral). If you only have a three point scale, the options are then "good" or "bad." So either a 5-point or 7-point scale gives you some flexibility.

The most important part of the evaluation is the notes section at the bottom! That's where you can write something like:

"You are a great asset to this team. Clients enjoy working with you, and several members of our team look to you for advice on processes as well as technical assistance. Your attempt to lead the migration project at ABC Corp did not go very smoothly. We're going to keep that on the goal sheet for the quarter. Let's work together to make sure you have everything you need. Keep up the good work, and thanks for being part of our team!"

After the employee has read through your comments, ask for feedback. Talk about the last quarter and the next quarter. Have them sign the evaluation form. Then talk about the goals for the next quarter.

Notice that you begin and finish with positive reinforcement. This helps to clarify that your overall impression is positive even if correction is needed. Always consider this a team building activity and NOT an opportunity to "build a case" against an employee so you can fire them.

Personal Beef: If you want to fire an employee, fire them! Don't buy into the corporate bullshit that you have to give them three or six letters of reprimand, a plan for change, etc. Check with your attorney, but unless your state prohibits it, you can just fire people. Or lay them off, or reduce their hours to zero.

One of the greatest lessons you'll ever learn in business is "The best time to fire an employee is the first time the thought crosses your mind." I first heard that from Brian Tracy. I've had to learn and re-learn it a few times but it's true.

So don't use the evaluation process for game-playing and manipulation. Use it to make your team and your company stronger!
[set rant=off]

Scheduling Employee Evaluations 

As always, there are some administrative details. The office manager should create a spreadsheet that includes each employee's name, date of hire, last review date, and next scheduled review.

The office manager first determines which dates and times the manager would like to set aside for reviews. This often works best if you pick a standard time slot and let the office manager fill as needed. For example, you might do employee reviews on Tuesday mornings. The office manager will need access to the manager's calendar. Once times are established, the office manager contacts technicians and other staff to schedule reviews.

Reviews should be scheduled far enough in advance for the manager to review the employee's file, write up a paragraph or two, fill out the company's standard review form, and generally be prepared for the review itself.

If you announce reviews and then put them off and put them off, then employees conclude that it's really not important to you.

When the review is completed, any action steps that are required should flow to tasks in Outlook or the company's PSA system. For example, the employee might be getting a raise or increased hours. The employee might be eligible for company-paid training. You need a process to make sure that decisions made as a result of employee reviews turn into actions within the company.

The office manager is informed that the review has taken place, updates the Excel spreadsheet, and creates a tickler to schedule again in three months or twelve months. You can see that a nice flow chart for this process makes it very smooth.

A Few Notes

You might want to tie raises or bonuses to reviews, but you don't have to. These really can (some say should) be different processes. Performance should be valued without regard to specific dollar amounts.

If you haven't done reviews before, be very open with your employees that it's new to you too. Ask everyone for input. Create forms that work for you and your company.

Fine tune the process to meet your goals.

And above all else, make the employee review process a positive thing for everyone.

Comments welcome.

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About this Series

SOP Friday - or Standard Operating System Friday - is a series dedicated to helping small computer consulting firms develop the right processes and procedures to create a successful and profitable consulting business.

Find out more about the series, and view the complete "table of contents" for SOP Friday at

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Next week's topic: Monthly Single Checklist


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