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The Empuls Glossary

Glossary of Human Resources Management and Employee Benefit Terms

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Employee Performance Review

Employee performance reviews are a crucial aspect of organizational management. They offer a structured framework for evaluating, providing feedback, and setting employee goals.

What is an employee performance review?

A performance review, also known as a performance appraisal or evaluation, is a systematic process in which managers assess an employee's work performance, provide feedback on strengths and areas for improvement, and set goals for future development.

Performance reviews serve as a cornerstone of performance management systems in organizations. They allow managers and employees to align expectations, improve communication, foster professional development, and ultimately enhance organizational effectiveness.

Listen, recognize, award, and retain your employees with our Employee engagement software  

What is the purpose of employee performance reviews?

The purpose of employee performance reviews are:

  • Evaluating employee performance: Performance reviews allow managers to assess an employee's achievements, strengths, areas for improvement, and overall contribution to the organization.
  • Providing feedback: Constructive feedback during performance reviews helps employees understand their performance relative to expectations and facilitates continuous improvement.
  • Setting expectations and goals: Performance reviews are an opportunity to set clear expectations, establish goals, and align individual objectives with organizational objectives.
  • Identifying training and development needs: By evaluating performance, managers can identify skill gaps and development opportunities for employees and facilitate targeted training and development initiatives.
  • Supporting career development: Performance reviews offer a platform for discussing career aspirations, identifying growth opportunities, and creating development plans to support employee advancement.

What are the key components of employee performance reviews?

The components are:

  • Goal setting: Establishing clear, specific, measurable, achievable, relevant, and time-bound (SMART) goals ensures alignment with organizational objectives and provides a framework for performance evaluation.
  • Performance metrics and criteria: Utilizing quantitative metrics (e.g., sales targets, productivity measures) and qualitative criteria (e.g., communication skills, teamwork) offers a comprehensive assessment of employee performance.
  • Feedback mechanisms: Balancing ongoing feedback with formal performance reviews fosters continuous improvement. Constructivist feedback techniques, such as the sandwich method or situation-behavior-impact feedback, promote positive dialogue and growth.
  • Self-assessment: Encouraging employees to reflect on their performance and strengths and align their self-assessment with manager evaluations enhances self-awareness and accountability.

What is the process of conducting employee performance reviews?

The process includes:

  • Preparation: Gathering relevant data and documentation, such as performance metrics, feedback, and goal progress, and scheduling review meetings in advance.
  • Conducting the review meeting: Setting a positive tone, reviewing performance metrics and feedback, providing constructive feedback, and collaboratively setting goals for the future.
  • Goal setting for the future: Discussing areas for improvement, establishing new goals, and outlining action plans to support employee development.
  • Documenting and following up: Document discussions and agreements and follow up on action plans to ensure accountability and progress.

What are the challenges and best practices of employee performance reviews?

The challenges and best practices are:

  • Addressing bias and subjectivity: Implementing standardized evaluation criteria, training on unconscious bias, and fostering open dialogue can mitigate bias in performance reviews.
  • Dealing with difficult conversations: Providing specific examples, focusing on behaviors rather than personality traits, and maintaining empathy and respect during difficult conversations promote constructive dialogue.
  • Ensuring fairness and consistency: Applying consistent evaluation standards, providing regular feedback, and conducting calibration sessions among managers enhance fairness and consistency in performance evaluations.
  • Encouraging employee engagement and participation: Involving employees in goal setting, soliciting feedback on the review process, and recognizing and rewarding performance contribute to higher engagement and participation.
  • Continuous improvement of the process: Soliciting feedback from employees and managers, conducting post-review evaluations, and adapting the process based on lessons learned foster continuous improvement.

What are the legal and ethical considerations of employee performance reviews?

The legal and ethical considerations are:

  • Compliance with employment laws and regulations: Adhering to employment laws and regulations, such as equal employment opportunity (EEO) laws and regulations governing employee privacy and data protection, is essential to ensure legal compliance.
  • Confidentiality and data privacy: Safeguarding confidential employee information, such as performance evaluations and personal data, and adhering to data privacy regulations protect employee privacy and maintain trust.
  • Handling sensitive information: Handling sensitive information, such as disciplinary actions or medical conditions, with discretion and confidentiality is crucial to upholding employee trust and confidentiality.
  • Ensuring non-discrimination and fair treatment: Avoiding discrimination based on protected characteristics, such as race, gender, or age, and ensuring fair and equitable treatment for all employees are paramount in performance evaluations.

Employee pulse surveys:

These are short surveys that can be sent frequently to check what your employees think about an issue quickly. The survey comprises fewer questions (not more than 10) to get the information quickly. These can be administered at regular intervals (monthly/weekly/quarterly).

One-on-one meetings:

Having periodic, hour-long meetings for an informal chat with every team member is an excellent way to get a true sense of what’s happening with them. Since it is a safe and private conversation, it helps you get better details about an issue.


eNPS (employee Net Promoter score) is one of the simplest yet effective ways to assess your employee's opinion of your company. It includes one intriguing question that gauges loyalty. An example of eNPS questions include: How likely are you to recommend our company to others? Employees respond to the eNPS survey on a scale of 1-10, where 10 denotes they are ‘highly likely’ to recommend the company and 1 signifies they are ‘highly unlikely’ to recommend it.

Based on the responses, employees can be placed in three different categories:

  • Promoters
    Employees who have responded positively or agreed.
  • Detractors
    Employees who have reacted negatively or disagreed.
  • Passives
    Employees who have stayed neutral with their responses.

Which tools and technologies to use for employee performance reviews?

The tools and technologies to use are:

  • Performance management software: Utilizing performance management software streamlines the performance review process, facilitates goal tracking, and centralizes performance data for analysis and reporting.
  • 360-degree feedback systems: Implementing 360-degree feedback systems allows for comprehensive feedback from multiple sources, including peers, subordinates, and supervisors, providing a holistic view of employee performance.
  • Employee evaluation templates: Utilizing standardized evaluation templates ensures consistency and fairness in performance evaluations and simplifies documentation.
  • Training and support resources: Providing training and support resources, such as workshops on performance management best practices and access to coaching services, equips managers with the skills and knowledge to conduct effective performance reviews.

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