A performance appraisal is an opportunity for you to speak with each employee about how they're doing in the workplace. It’s important to focus on goals, results and overall performance while talking about specific strengths and areas of improvement. Performance appraisals can be nerve-wracking for some employees, so it’s vital to establish a comfortable and honest setting for the discussion.

Prepare for the Appraisal Interview

Performance appraisals should be held at regular intervals, giving both you and the employee ample notice to prepare for the meeting. In many businesses, performance appraisals are held on an annual basis, with quarterly check-ins to ensure the employee is on track to meet their annual goals. Each appraisal interview should provide enough time for you and the employee to discuss their performance at length. Set aside 45 to 90 minutes so that no one feels rushed during the meeting.

Ask the employee to complete a self-appraisal a few weeks before the meeting. Give them enough time to carefully and thoughtfully provide answers to your questions. Prepare for the performance interview by reviewing the employee’s job description and their self-appraisal. Pay close attention to the employee’s goals and whether or not they've met them during the course of the year.

Encourage your employee to prepare for the appraisal interview by filling out the self-appraisal and writing down issues, concerns or questions they'd like to discuss with you in the meeting. Ask them to think about their goals for the coming year, in addition to their larger career goals and career trajectory within the company.

Offer Constructive Feedback

It’s important to put the employee at ease during the performance interview. Select a quiet and private place to have the discussion so that no other employees can hear the conversation. Begin on a positive note to help the employee feel comfortable. Tell them what to expect during the meeting so there are no surprises.

For example, let them know you’ll begin by giving your thoughts on the self-appraisal and then you’d like to hear from the employee on how they feel their performance is going. Then, you’d like to discuss the goals for the following year and listen to where the employee would like to go next with their career.

Provide fair and honest feedback during the performance interview. Be sure not to dwell on weaknesses alone. It’s easy to get caught up in discussing how the employee can improve in certain areas. However, it’s also critical to specify where the employee is succeeding and what you want them to continue doing in the workplace. Mention their areas of strength and outline how they add value to the business.

Refrain from comparing the employee’s performance to other employees in the company. Instead, look at how far the employee has come in their own right. Have they learned a new skill they didn't know last year? Have they taken on new tasks that are outside their job description? Have they self-identified a weakness and started working on ways to improve it?

Listen to the Employee

During the performance appraisal process, give the employee plenty of opportunities to provide their perspective. Take care to listen closely to what they say. Get rid of any preconceived notions about what you think they may say. Instead, empower the employee to talk candidly about their performance.

This will help you to better understand the employee’s career goals. It will also help you to learn more about them as a person, not just an employee. As a result, you’ll be able to better coach and teach them new skills and processes to add more value to the company.

Establish Next Steps

Figure out the next steps during your performance appraisal. Set the next set of goals and objectives for the coming year. Define what skills are important for the employee to build on. Outline what courses or seminars they can take or what workshops they can attend. Create a plan to help the employee reach their long-term career goals.

Finally, end on a positive note. Thank the employee for their service to the company and the work they have done thus far. Express excitement for the coming year and the growth and new opportunities it will bring.