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The Annual Review: A Manager’s Guide

performance-review

Ah, the annual review. There are few times throughout the year as stressful as the annual review. Why is this? Because many managers are uncomfortable giving direct, honest feedback. Also, managers are so busy trying to find time to prepare for the review, plan development, schedule reviews, and all the other activities required to adequately prepare so the process can be very daunting indeed. Relax! This post will provide a brief overview of the annual review process as well as tips on how to structure and deliver meaningful feedback to your team to get results and aid in development.

Historically, the review process is designed as an opportunity to provide timely feedback to employees on their performance during the year. Basically, it’s a one-way communication from manager to employee on what they can do better (identify “opportunities for improvement” in modern corporate speak). I strongly feel this has become an “old fashioned” way to approach the annual review.  I know that you don’t want to be an average “old-fashioned” manager, you want to be a great manager (you are reading this post, after all), so I have developed a five step approach to take the annual review from good to great:

 

Make the annual review more of a self-assessment by the employee.

I start all reviews with the following three questions:

  1. What do you think you did particularly well this year? Ask for specific examples. If you get a good example, don’t move to the next question, but ask: what else? Keep asking “what else” until the employee’s list is exhausted.
  2. What could you have done better? Again, ask for specific examples. Keep asking “what else” until  they are all out.
  3. Ask what they have learned from their successes and mistakes. This question usually takes the employee by surprise, but it is critically important. Allow them time to think. The purpose of these first three questions is to make the employee more self-aware about their actions. As a manager, you should also let them know that it is OK to make mistakes (everyone makes mistakes, after all) as long as they learn from them. Making self-awareness and learning part of the review leads to employee empowerment.

 

Provide specific, actionable feedback to the employee, both strengths and opportunities to improve.

Only after the employee self-assessment do I provide my input. 90% of the time, my feedback aligns completely to the employees own. When this happens, great! It means the employee will be aligned to your feedback and you will build rapport. If your perception of employee’s performance does not match up, be clear, concise and specific in your feedback. For example, instead of saying, “you are often late addressing requests” say something like, “remember that time when we were dealing with X customer issue? I asked you to do XYZ and you did not follow through. The result was that the customer was upset and we lost the project. In the future, please try to respond to these requests within 24 hours.” You can see how the second example is much more quantified and actionable than the original “you are often late addressing requests…”  Try to provide at least three specific examples of when the employee did a great job, and three examples of where the employee can improve.

 

Develop a clear plan…and follow through!

Employees crave development, but they rarely get it. The third question I always ask in a review is “what development opportunities do you need to be successful going forward?” Again, keep asking “what else” until all ideas are on the table. Once the employee is finished, it’s your turn to provide development opportunities. Again, be specific! Talk about specific projects, training courses, or other opportunities that will help the employee grow. Once you agree on development opportunities, it is the MANAGER’S RESPONSIBILITY to ensure the employee follows through on these events. Career development is critically important and is a common source of dissatisfaction among employees.

 

Ask the employee about things you can do to make them more successful.

That is, ask for feedback on your performance from employees. I rarely find managers who do this, which is a shame. This part of the review is the employee’s opportunity to “review” you as a manager. Listen, don’t judge, and keep asking “what else” until you feel all the employee’s ideas have been addressed. Take the feedback seriously, and add it to your own development plan.

 

Be prepared.

When done successfully, this type of employee review will be more a conversation than a one-directional source of feedback. In order to deliver this type of review, you should prepare by doing the following:

  1. Schedule the review well ahead of time (1-month if possible).
  2. In the email, give an agenda of the meeting and ask the employee to prepare thoughts around each part of the agenda.
  3. Review each employee’s goals and attainment of those goals to-date. Also, take notes on what they are doing well and opportunities for improvement. Make a list of potential development opportunities and take a guess at what their feedback about you will be (e.g. see how self-aware you are as a leader).
    • Self assessment
    • Manager feedback/goal attainment
    • Development planning
    • Feedback for manager
  4. Follow-up with the employees 60 days after the review to assess progress and re-calibrate as needed.

Yes, this is a lot of work, but developing talent is one of the most important roles of a manager and one of the greatest sources of dissatisfaction from employees. Use the annual review as an opportunity to gather feedback on your own performance as a manager, be ready for blunt, honest feedback, and use the feedback to update your own development plan.

Finally, especially if you have a big team, you need to develop a “top-grading” mindset. Top-grading is something all managers do instinctively, but the annual review is a great opportunity to bring the top-grade mentality to the forefront. So, what is “top-grading”? Basically, top-grading is identifying the weakest members of your team (generally, the bottom 10%). But it is more than that: use top-grading to show not only your weakest, but also your strongest member. There are two questions to ask yourself once you have had reviews with your entire team:

  1. If you could hire the PERFECT candidate tomorrow, who on your team would you remove to make room for this perfect candidate?
    This is your “bottom” top-grade. This person is the “first to go” if a better candidate comes across your desk.
  2. If you (the manager) won the lottery tomorrow, who on your team would be your back-fill?
    This person is your “high-potential” top-grade. Make sure you are doing everything you can to develop and prepare this person to one day have your job.

To summarize, one of the most important (if not the most important) roles of a manager is to develop and manage talent. The annual review process, when run appropriately, provides an opportunity to energize and empower your team, gather valuable feedback about yourself as a manager, and identify top and bottom talent. Using the advice in this post, you can now use the annual review to take your team (and your insights as a manager) from good to great.

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