The Best Ways to Manage Employee Performance

The Cons of Improper Performance Management

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While managing employee performance is an important concept because it helps ensure that each employee is more likely to hit the goals set for them, improper performance management can have seriously detrimental effects.

For example, if an employee feels as if they performed as well as they could, provided their resources and their abilities, but that any assessment made was unfair or even biased, they may decide to seek other employment opportunities.

It's imperative for supervisors to understand how to engage in fair employee performance management practices as well as to take the employee's abilities and even some personal considerations into advisement.

Employees are human, and their personal lives can and do affect their performance. While this should not always be the case or constantly be used as an excuse, employees who generally meet or exceed their goals should be provided with the resources they need to get back on track when possible. This helps inspire loyalty to the company as well as helps the employee feel as if their performance assessment is fair and unbiased.

Improper performance management can damage employee morale. If employees feel as if they are treated unfairly during a performance assessment, it can cause morale to drop. They may feel resentment toward management or the entire company. If this occurs, they may no longer work to their full potential, take more sick leave or vacation time, or look for other employment opportunities.

Unfair goals set by management make the entire review process inherently unfair to the employee. Unfortunately, many companies do not require those individuals conducting reviews to take the employees' input into consideration when setting goals.

This leads to inherently unfair goals being set since the individual setting the goals likely has an idea of the work that goes into meeting them. It is essentially stacking the deck against the employee against getting a satisfactory or let alone excellent, review.

The company may require the use of more resources. This includes both time and money. A survey conducted by Deloitte showed that supervisors spend more than 200 hours on performance review activities.

Combine that time with getting employees back on track if they feel as if they were treated unfairly and they are demotivated, taking additional time off, aren't working up to their potential, feel burned out, or they decide to quit.

If employees quit, the company then must go through the process of investing time and money into the hiring process. This is a significant investment. Then, there's the time and expense taken to train the new employee as well as the time it takes for them to reach the point where they are able to meet the necessary goals.

Tips of How to Manage Employee Performance

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Because employee performance reviews are critical to the success of meeting the goals of a business, it's imperative that managers understand how to effectively manage the process.

Make sure that management and employees understand that employee performance isn't supposed to be a time of negativity and criticism. This should be a time of teamwork and a time for employee development.

Apply Constructive Criticism
Train management to use constructive criticism if it is necessary. Management should also have an open-door policy and be open to accepting constructive criticism as well. Management should be ready to accept suggestions and potential solutions when it comes to the work actually being performed. Goals that are set should be set together with the employee.

Set Clear Expectations
The expectations set should be clear. Both the employee and the manager should have frequent communication. This isn't about the micromanagement of work. It's about ensuring that more resources aren't needed as well as to ensure that the objectives set are, indeed, realistic.

Keep Morale on a High Note
Morale should always be a priority. Employee morale should never be crushed. While handholding shouldn't be required, morale is an important concept because happy employees are loyal employees. This means fewer hiring expenses.

Morale Boosting Tips-
Some ways that morale can be improved and continued include-

  1. Asking employees what can be done in the department and be the company to help support them
  2. Providing monetary incentives,
  3. Providing flexible schedules, and other fringe benefits.
  4. Providing public praise is another simple yet effective way to build morale.
  5. Offering opportunities for professional development is another fantastic and cost-effective way to build morale.

Delegate Authority Effectively
Make sure that employees have the power they need to succeed in their position. This includes having the right tools and resources to be productive as well as ensuring that they have the authority to do their job without being micromanaged. While these things may sound simple, many businesses do not follow through in these areas and then seem shocked when company goals aren't met.


Failing to properly manage employee performance can result in employees quitting their job.
Failing to properly manage employee performance can result in damaging employee morale.
Unfair goal setting by management can make the entire assessment process inherently unfair to the employee.
Improper employee performance can cost the company more time and money in the long run.
Proper employee performance management should be a time of teamwork between management and employees for goal setting and employee development.
Management should be trained to use constructive criticism where necessary.
Management should be open to feedback from the employee so that goals may be properly set.
Make sure employees have the power and the tools they need to succeed in their position.

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