What is it?
A performance review, also known as a performance appraisal or evaluation, is a formal assessment in which an employee’s job performance is evaluated by their manager or supervisor. The purpose of a performance review is to provide employees with feedback on their work, recognise their achievements, identify areas for improvement, and discuss future goals. Performance reviews often take place annually or semi-annually, though some organisations may conduct them more frequently. Performance reviews typically cover various aspects of an employee's performance, such as productivity, quality of work, teamwork, problem-solving, communication, and overall contribution to the organisation’s objectives. These reviews may involve self-assessments, peer feedback, and discussions about the employee's strengths, areas for development, and career growth opportunities.
Why is it important?
- Provides Constructive Feedback: Performance reviews give employees valuable feedback on their strengths and areas that need improvement. This feedback helps employees understand how their work is perceived and what they can do to enhance their performance.
- Sets Clear Expectations and Goals: Performance reviews clarify job expectations and set measurable goals for the future. This helps align employee efforts with the organisation's objectives, ensuring that employees focus on the most critical tasks and priorities.
- Improves Employee Development: By identifying areas for improvement, performance reviews guide employees in their professional development. They may highlight skills that need further training or opportunities for advancement, helping employees grow within the company.
- Enhances Communication: Regular performance reviews foster open communication between employees and managers, creating a platform for discussing performance, career aspirations, and concerns. This dialogue strengthens relationships and promotes transparency.
- Supports Employee Engagement: Employees who receive regular feedback and recognition are more likely to feel engaged and motivated in their roles. Performance reviews give employees a sense of accomplishment and direction, contributing to job satisfaction and retention.
- Helps with Compensation Decisions: Performance reviews often influence decisions about raises, promotions, bonuses, and other rewards. By linking compensation to performance, employers can ensure that high performers are recognised and rewarded fairly.
- Provides Documentation: Performance reviews serve as formal documentation of an employee’s performance over time. This documentation can be important for making employment decisions, addressing performance issues, or handling disputes.
- Aligns Individual and Organisational Goals: By connecting individual performance to broader organisational objectives, performance reviews help employees see how their contributions impact the company’s success, which can boost motivation and productivity.
