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How Often Should I Conduct Employee Reviews?

Angie Mansfield

August 06, 2013

A source of confusion for many small business owners, especially those who are new to having employees, is how often to conduct employee reviews.

Is once a year enough? Should it be every six months? And how should I conduct the review so it's beneficial to both sides?

Here is some advice to help clear things up:

Provide Ongoing Guidance

First, you shouldn't wait until official review times to give your employees performance guidance. If you see one of your workers doing something wrong, or doing a great job on a project, tell her right away.

By reinforcing great performance on an ongoing basis, you'll improve your company's productivity, and your employees should know what to expect when review time comes around. This will also help keep office morale high.

When to Provide Official Reviews

Many companies provide employee reviews on a yearly basis, but this should be a bare minimum. A lot can happen in a year's time, and waiting a year to talk to someone about his work performance may be too long.

Another consideration when deciding how often to hold reviews is changing market conditions and other factors in your business.

If you can give your employees reviews quarterly or every six months, you can more easily change performance expectations to meet shifting business priorities.

This is especially important during a slow period in your business, when you may have to make operating adjustments to weather a lower sales period.

Your employee reviews give you a chance to help your staff understand how they can help you meet business goals. It also lets you help them come up with a plan to overcome their specific challenges.

Conducting an Effective Review

Once you've got your review schedule nailed down, it's time to come up with a review process that will be productive for both you and your employees.

With that in mind, here are a few do's and don'ts:

Do: Set benchmarks for evaluation well before conducting reviews. Preferably, these benchmarks should be part of the job description, and should lay out what criteria will be used when evaluating performance;

Don't: Let an employee's performance in one or two areas unfairly bias the entire review. If your worker has good performance overall, but made a blunder in one project, your entire review should not be centered around that mistake;

Do: Start with the good news. By starting with the positives, you get the employee on board with the process. If you start with the bad news, she may be too busy worrying about it to pay full attention to the rest of the review;

Don't: Compare employees to each other. Your evaluation of an employee should be according to standard performance benchmarks -- not what your star employee does. And don't mention other employees as models of what a worker should or should not do. This raises your risk for employee conflict and deteriorating office morale.

Employee reviews don't have to be a stressful process.

By providing regular feedback to your workers, and making it clear from the beginning what criteria you'll use to grade performance, you'll keep your workers informed and on track.

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