Annual performance reviews are dreaded on both sides of the desk, and usually for good reason: the goals were set a year ago and never revisited, neither person is sure they are still the right goals, and the conversation ends up being about a form. A review is worth doing when it is the summary of a year of ordinary conversations. It is close to worthless as a substitute for them.
Set Expectations You Can Actually Measure
- Describe outcomes, not activity. “Orders shipped same day 95% of the time” beats “process orders efficiently.”
- Cover the how as well as the what. Someone who hits every number and is impossible to work with is not performing well, and your expectations should say so in advance rather than after.
- Keep it to a handful. Fifteen objectives means no priorities.
- Agree them, do not issue them. People commit to what they helped write.
- Revisit them when the business changes. Holding someone to January’s goals in a business that pivoted in April is a paperwork exercise, not management.
New Employees Need This Earliest
The most valuable expectation-setting happens in the first weeks, when a new person is deciding what “normal” is here. Waiting until an annual review to mention that something has been wrong since March is unfair and largely your fault.
Set out what the first 30, 60, and 90 days should look like, meet weekly through that period, and give correction immediately and quietly. Feedback in week two is a small adjustment; the same feedback in month nine is a confrontation.
Feedback Between Reviews
- Nothing in a review should be a surprise. If it is, the failure is the manager’s.
- Keep a running note through the year — a couple of lines a month per person. Otherwise the review reflects the last six weeks, which is the most common bias in the whole exercise.
- Give feedback close to the event, specifically, and in private for anything corrective.
- Ask for feedback on yourself, and do not argue with what you get.
Experienced People in New Roles
A veteran employee moving into a new role is the case managers handle worst. The assumption is that someone with fifteen years here needs no onboarding, so they get none — and then struggle in a role that is genuinely different, with a reputation that makes asking for help harder.
Give them the same explicit expectations and the same early check-ins you would give a new hire, while being clear that it reflects the new role rather than doubt about them. This is especially true of the move from doing the work to managing the people who do it, which is a change of occupation.
Running the Conversation
- Both sides prepare in advance, and ask them to write their own assessment first.
- Let them talk first. Most people are harder on themselves than you were going to be.
- Use evidence, not impressions, and cover the whole period.
- Separate the pay conversation from the development conversation, even if only by a week — nobody hears feedback while waiting to find out about money.
- Do not sandwich criticism between compliments. Everyone has learned to discard the bread.
- End with two or three things for the next period, written down, with dates.
Looking Further Ahead
Reviews look backward at one person. Two related questions are worth asking about the business as a whole, once a year, and almost no small employer asks them.
- Who is leaving, and why? Look at your turnover by role and by manager rather than as one number. Turnover concentrated under one supervisor or in one job is telling you something specific. Exit conversations are worth having, and worth taking seriously even when the stated reason is bland.
- What skills will you need in three to five years, and who could grow into them? Knowing which roles would be hard to replace — and who is close to retirement — turns a future emergency into a training plan.
Managing Performance Without Authority
Some of the best performance managers have no authority at all. They are the people who see what needs doing, who others go to, and who get things moving across a team without any of it appearing on an org chart.
What they do is available to anyone: be reliable so people trust your word, be specific about what you need and when, make it easy for others to say yes, give credit generously, and follow up without nagging. If you are hoping to move into management, doing this is both the best preparation and the most persuasive argument that you should — see careers in business and management.