Evaluating the performance of your managers is just as important to a small business as performing employee assessments. Managers with good communication and organizational skills can get more out of their staff than managers with poor self motivation and a disorganized approach to staff management.

Create a standardized form that highlights the criteria on which managers will be judged. Typical categories include interpersonal communication, meeting goals and deadlines, staying within budget, employee feedback, team direction, motivation, employee job satisfaction and collaborative efforts with other department heads.

Allow employees to submit anonymous evaluation forms that rate their managers’ performances. Ask staffers to assess managers on availability, direction, encouragement and motivation, equitable treatment and career coaching. Ask employees what they would change about their managers and what they consider to be their managers’ strengths and weaknesses.

Meet with your manager and discuss his performance during the assessment period. Give credit where credit is due for significant professional strides and contributions, and discuss areas that need improvement. For example, if employees provide feedback that indicates a manager is difficult to reach and has poor communication skills, that's a topic to bring up. Ask for the manager’s feedback and assess ways he might be able to improve his communication in the future.

Set goals with your managers each year so you can review goal progress during your annual management assessments. You might set individual goals, such as participating in professional development seminars, as well as team or department goals, such as program implementation, revenue generation or measurable productivity levels. During your review, assess progress on goals and determine what the problem was if goals were not met as anticipated.

Allow time for feedback. A manager might have justifications for why he didn't perform as expected in certain areas, which you can then discuss. A manager might also have ideas for how performance can be improved or how support from upper management can help him better achieve his department’s future goals and objectives.

Tip

Start and end your performance appraisal on a positive note. This will help the manager maintain a positive outlook and encourage him to move forward in a productive way.

Warning

In a small business, managers and employees often have personal and friendly relationships with each other. This can skew the evaluations employees give their managers, especially if raises or advancement opportunities are tied to positive performance reviews. Staffers may be concerned that giving honest yet poor reviews will be detrimental to their supervisors. Combat this possibility by removing pay increases from the evaluation equation.