A good performance evaluation system should consider four goals

Keys to a good performance evaluation system

How do you know if you have a good performance evaluation system or what are you missing if you’re not doing anything? To understand the business reasons for having a performance evaluation system, consider these four key goals:

1. A performance evaluation system ought to impact performance.
   Now, the only way you can impact performance is if when you’re done talking and warming your jaw the person you sit down and talk to does something different as a result of that conversation. The employee preferably does something positive and different as a result of the conversation.
   
   
2. A good performance evaluation system should generate motivation.
   It’d be nice if after you as a manager invested your time in sitting it out and talking to your employee, if they left there saying, “You know, you’re going to see more of me. I can do that. You watch.” There are those who say the only way you can tell somebody’s motivated is if you asked them on a paper and pencil test.

   But you can tell when somebody’s motivated. Do they come to work early? Do they take work home with them? Do they stay late? Or are they stacking stuff up 45 minutes in advance to leaving? You want somebody that when you’re done talking to them, doubles down on everything they’re doing.

3. Reducing turnover.
   It’s not your worst employee who comes in and resigns; it’s your best employee. Why? Well first of all, nobody wants your worst employee. Secondly, your worst employee does not have the energy level it takes to go out and look for a job. So reducing turnover is about your good people. A coaching model is very different than a judging, grading, evaluating model because a coaching model is focused on the future.

   Have you ever done an exit interview with somebody you really hate to lose and they say “Hey, I took a job down the street for 15% more and doing the exact same thing I’m doing here.” What they say instead is, “Hey, in the new job. I get to be the one in charge of this. You know, I get to try some of this. I get to be a leader over here. Oh, yeah, and yeah, they pay me 15% more to do it.”

   It’s not about the money. Your good people will leave you because as soon as they feel stagnated, they start looking. So keep them growing by talking about the future.

4. A good performance evaluation system handles the notion of minimizing legal exposure.
   If you have employees, you got legal exposure.

   The best way to minimize legal exposure is to curb righteous indignation. The people who sue you are angry. The people who sue you are hurt. Because they’re angry, because they’re hurt, they want you to hurt. The way you curb righteous indignation is you learn to somebody’s face the kind of thing you’d say about them behind their back.

   Catalytic coaching does what most of the average performance evaluation system doesn’t. So if you have something that has three out of five of those things you’re already doing, you’re already getting, this is what you’re paying for and that’s good.

Edited remarks from the Rapid Learning Institute webinar “No More Performance Reviews! – A Revolutionary Approach to Performance Feedback” by Gary Markle