Employee performance reviews can be effective management tools or a waste of time. The key to a successful performance review is setting realistic, measurable goals and monitoring employee progress throughout the year. A goal is the result to which an employee’s work effort is directed. This is also the purpose of employee performance management -– to manage employees’ work to achieve team, department and organizational goals.
The S.M.A.R.T Criteria
In 1981, project management expert George T. Doran proposed the S.M.A.R.T. criteria for project management and, over the years, human resources professionals have adopted the criteria for setting employee performance review goals. According to this model, employee goals should be specific (S), measurable (M), achievable or attainable (A), results-oriented or relevant (R) and time specific (T). The S.M.A.R.T. model is the starting point for setting employee performance review goals. But there are other factors that should be included in the goal setting and management process for it to be effective.
People don’t like to be told what to do. Employees are more likely to accept and work to achieve goals if they have a voice in the goal setting process. In addition, most employees know the ins and outs of their jobs, including tasks and obstacles that are not part of the formal job description. Including employee input in the goal setting process is essential for success.
As a first step, managers should communicate the organization’s strategic goals along with the department and team goals to their employees. Then, instruct them to develop three to five goals related to their work and the team’s goals. Review the goals with the employee in the context of the S.M.A.R.T. criteria.
Be sure to set time frames achieving the goals. For example, a trainer might have a goal to research, develop and pilot test a one-hour review course for nurses on proper hazardous waste disposal procedures by April 30, 2010. Such a goal would support the organization’s health and safety goals, as well as continuing education requirements for nurses.
Job specific goals are tied to the tasks assigned to the position. Job descriptions describe the tasks to be performed but often do not define quality and quantity measures.
For example, a receptionist’s job description may state that the person answers all incoming calls. A performance goal for this position would be that all incoming calls are answered within three rings 99 percent of the time, and the receptionist will achieve this rate by June 30, 2010 and maintain it throughout the year.
Employee Development Goals
Job descriptions can also be useful in setting employee development goals. For example, a claims processor who only processes home owner claims may be given a goal of learning the new motorcycle claims process and achieve a 95 percent accuracy rate by October 31, 2010.
Monitor and Recognize Progress
Managers should monitor employees’ progress on their goals throughout the year. Employees need to know how they are doing on reaching their goals. This includes celebrating progress and coaching employees when problems occur. In addition, as business needs change, employee goals may become obsolete and must be revised to reflect the changing needs of the business.