If you want to keep your business pushing forward, it is important that you perform regular evaluations on the performance of your greatest asset – your employees.

Arguably, this is more important when you have a number of employees (say, more than 10) that you can’t supervise at the same time and therefore you are never fully aware of the tasks they are doing.

In such case, although many employers don’t enjoy the work and time involved, an appraisal system should be introduced to determine the performance and value of all employees in your business.

By doing so, it will not only benefit your business, but also the employees.

Reasons for an Appraisal

There are many reasons why you may decide that an appraisal is appropriate and below is a common list for using one:

• To identify any training that may be needed
• To make personal/business objectives clear
• To identify employees that are potential for promotion
• To review salaries or payment methods
• To identify individual strengths of employees
• To increase motivation
• To develop relations between the employee and the supervisor
• To improve performance
• To update job descriptions

The main benefits for using an appraisal system are as follows:

• Gives you an idea of what you should expect from your employees
• Develops further yourself as a manager (or superior)
• Employees are given feed-back that can be acted upon to increase their productivity and ability by eliminating their weaknesses and identifying strengths
• The supervisors develop a better relationship with the employees by getting to know them better and what their job consists of more precisely
• Improves communication in the business

When Should You Do an Appraisal?

Appraisals have no set structure when time is involved and are usually done when the business believes it is necessary. Ideally, appraisal should be something that goes on all year but there are only so many times when you can formally evaluate your employees.

Although different people will have different opinions on when an appraisal evaluation should be issued, the first is suggested after six months of the initial employment of the employee. After this, the next appraisal is suggested six months later and then extended to following yearly periods. It is therefore saying that all employees will have different times for appraisal evaluations but you may designate a specific time of the year where you will evaluate all employees at the same time.

How Do You Evaluate Performance?

So far, we have used the term ‘performance’. You may already have your own ideas of evaluating performance but below are ways that you can split it up and determine the level of standard for each employee:

• Meeting Deadlines projects, paper work, returning phone calls, attending meetings, etc
• Numeric no. of sales, production rate (e.g. invoices sent per day), etc
• Procedural responding to complaints, giving out information, etc
• Financial profit made, working to budgets, etc
• Negative personal complaints, no. of defects (e.g. per day), comments made by other staff and customers, etc
• Recognizable relations with customers, presentations, comments made by other staff and customers, etc