Mark Gundacker once worked at an insurance company, where he taught classes on how to conduct performance reviews—without ever being reviewed himself. His boss at the time assumed that managers didn't need pointers, says Gundacker, who knows better.
These days, Gundacker plans and oversees performance reviews as global director of human resources for EDAW. The San Francisco–based landscape and environmental design firm has doubled in size over the last five years—it now has 1,700 employees in 35 offices around the world—and continues to grow. For the firm to be effective at recruitment and retention, it needs to maintain its reputation for helping employees achieve their goals, says Gundacker, who joined in 2004. One way to do that is to hold periodic meetings to discuss those goals. Although they're known as performance reviews, the meetings offer opportunities to talk about much more than the past, Gundacker says. And though employees are sometimes nervous about being evaluated, they should emerge from a review psyched about the future.
Think about next year. “Too many people use the performance review as a backward-looking, rather than a forward-looking, tool,” says Gundacker. “Sure, it's an opportunity for the employee to get feedback on past performance. But even more important is that managers ask employees questions like ‘Where are you hoping to go? What do you need to do to get there?' At EDAW, we use the annual review to talk about goals for the next year. Then we do a midyear follow-up to see if the employee is meeting those goals.”
Do it in the fall. Some companies conduct performance reviews on the employee's anniversary, which could be any time of year. Gundacker prefers to hold them in September or October. That way, people can get a sense of how they're doing before end-of-year bonuses and raises are announced. Reviews are more effective when they're linked to tangible results.
Get more than one opinion. In design firms, people don't typically work for one person for an entire year. So it's important for the person conducting the review to solicit views from other managers. “This is especially important at a firm where creativity is valued,” says Gundacker, since creativity isn't something that lends itself to objective measure.
Evaluation forms should guide the manager ... At EDAW, managers fill out forms rating employees on five criteria: communication, quality of work, productivity, innovation, and teamwork. The last two are especially important at a design firm, Gundacker says. For managers, there are additional criteria like leadership and financial effectiveness. No EDAW employee—not even a top manager—is exempt from the process.
... and the employee. Before the review at EDAW, the employee is asked to complete a self-evaluation. The manager can use the employee's own observations to start the conversation rolling. “It's a good icebreaker,” says Gundacker. But keep the forms simple: “If the paperwork is too complex,” he says, “the process becomes about filling out the forms.”
Schedule enough time. “I tell managers to allow at least an hour, with no interruptions,” says Gundacker. “If in the course of a year you can't block off an hour to have a meeting with an employee, that sends the employee a message.”
Use the form as a guide, not a script. A manager should go beyond just reading the evaluation to the employee. The purpose is to have a two-way conversation.
Sign off. At the end of the meeting, the manager and the employee should both sign the form. That signals that there's agreement, not only about what the employee has done but also about what the employee plans to do—which is what really matters.