This article details the steps needed to evaluate an employee as well as providing an explanation of evaluation tools. The importance of knowing why an evaluation is being made, who should do the evaluating, and what types of evaluation tools should be used are also explained. After reading this article the reader should have a better understanding of the evaluation process, and they should have a better understanding of the tools used in employee evaluations.
Evaluating your employees is an important and vital activity to your company’s effectiveness and efficiency. Not only does it give you, the owner or manager, a better idea of how well your employees are performing, but it also gives you the justifications needed to terminate an employee, impose disciplinary measures, to give an employee a raise, or to give an employee a promotion. In order to gain the most benefit from an evaluation several steps need to be taken to ensure that the right people examine the right issues, and in the right manner.
Step One: Determine the Reason for the Evaluation
The first step in creating an effective employee evaluation is to first determine why you want to evaluate your employees. These reasons may be to determine grounds for changes in compensation or position within the company, as a way to determine if the employee in training is progressing properly, to determine if an employee needs to be terminated, or as a function of personnel research. Knowing the reason for the evaluation is important because each purpose has a different set of objectives and tools. For example if the evaluation is intended to be used to determine if an employee deserves a raise in pay, then elements like job proficiency, productivity, and customer satisfaction may all be used to determine whether or not a raise is warranted. In this case objective and measurable qualities and behaviors need to be measured, and subjective qualities like the personability the employee should be omitted as they may not accurately describe a quality that impacts the employee’s work.
During the training and probationary periods, evaluations are also needed to determine if the employee is learning the job fast enough and with enough proficiency that their continued employment will be either an asset or liability for the company. If the evaluation is improperly formatted, or if it uses tools that do not objectively measure factors that will predict future performance, then an improper employment decision may be made. As a result of this mistake, a potentially great employee could be terminated, or a below average or combatant employee may be retained.
Personnel research is another reason why companies evaluate their employees. In this instance the evaluation will be measuring a specific issue such as the effect that a time saving tool has had on productivity, or to determine the overall job satisfaction rate within the company. In order to determine these things specific tools will need to be used that address and measure specific qualities, behaviors, and results. For example if personnel wanted to evaluate job satisfaction they would probably send out a questionnaire that asked questions pertaining to issues related to job satisfaction like if they feel that their supervisor listens to them, if they feel that their supervisor seems to make fair decisions, and if they feel that their presence within the company is appreciated. If the wrong tool is used for an evaluation then the wrong elements and issues will be measured and the information gained from the evaluation will be useless. For example if we look at the job satisfaction scenario again and instead of sending out a questionnaire that addresses issues that directly relate to job satisfaction, and instead it asks questions pertaining to their feelings about possible changes in shift schedules, then the wrong information will be evaluated. While a change in shift schedules may impact future job satisfaction, it does not reflect CURRENT job satisfaction and therefore it is not a proper focus for a survey intended to measure current job satisfaction rates.
After the reason for the employee evaluation has been determined you can then move on to the next step, deciding who will be doing the evaluation.
Step Two: Determine Who Will Be Doing the Evaluation
Variety of evaluators
In this step you will need to decide who should conduct the evaluation. This decision should be based on what kind of information you are looking, and it may involve several different people. For example, if you are evaluating an employee to determine if they deserve a raise or promotion, then you will probably want their supervisor to evaluate their overall performance. However, you also might want to include their customers’ opinion about the employee’s performance, as well as the opinions of any subordinate employees under the employee being evaluated. It is also a good idea to have the employee to evaluate himself or herself.
Step Three: Create an Evaluation Instrument
Performance scoring devices
Trait focused performance appraisal systems
Behavior focused performance appraisal systems
Result focused appraisal systems
Graphic rating scales
Forced-choice rating scales
Mixed standards rating scales
Behaviorally anchored rating scales
After you know both why you are evaluating the employee and who will be doing the evaluation you can then design a tool that will measure the items that you want to evaluate.
There are generally three different kinds of focuses that an evaluation tool can have: a trait focus, a behavior focus, or a result focus.
Trait Focused Performance Appraisal System
In a trait focused performance appraisal system, specific traits like dependability, helpfulness, punctuality, etc. are evaluated. This particular appraisal system is often used in customer service evaluations, however, they have many drawbacks. First they are extremely subjective to personal biasing and circumstantial situations. Secondly the reliability and accuracy of these types of evaluations are relatively low. Because of these drawbacks trait focused performance appraisal systems should therefore only be used as a supplement to a more reliable form of an evaluation tool.
Behavior Focused Performance Appraisal System
The next type of evaluation system is a behavior-focused performance appraisal system. This type of evaluation will evaluate what an employee actually does. Common evaluation tools for this kind of evaluation include graphic rating scales, behaviorally anchored rating sales, forced choice rating scales, and mixed standards scales. A graphic rating scale places several employee behaviors on a scale and evaluates where the employee’s performance falls on the sliding scale from excellent to poor. If the employee is performing in a way that is inappropriate manner or in a way that is insufficient to meet the needs of the company, then their scores for each of the desired behaviors will be grouped at the bottom of the scale. If they are performing like an average employee, then their scores should cluster in the center of the scale, and finally if they are performing in an above average manner then their scores will tend to cluster at the top of the scale. This type of rating system will also allow you to easily see what areas the employee excels in and what areas they need to work on.
In a behaviorally anchored rating scale the selected behaviors are listed and the evaluator determines if the employee’s performance is adequate. The results are usually formatted in a pass/fail format.
In the forced-choice rating scale behaviors are listed to the left and there are four or five ratings that can be selected on the right. These ratings usually follow a ranking of performance such as poor, needs work, average, above average, or excellent. It is called forced-choice because the evaluator can only choose from the selections provided and there is no place for them to provide their own interpretations or median ratings.
The final scoring devise is the mixed-standards scale. In this type of evaluation tool there is a forced choice scale and a place for the evaluator to make notes and comments as to why they made the choices that they did.
Result Focused Performance Appraisal System
In a result-focused performance appraisal system the concentration is on quantifiable evidence of what an employee accomplished in their job. This is perhaps the most commonly used tool by managers when they are interested in finding out how much an employee is contributing to the company’s bottom line. To design an evaluation tool for this appraisal system you will want to focus your questions or skill evaluations on (1) the quantity of work accomplished, (2) the quality of work accomplished, (3) attendance, and (4) employee safety. To get this information you will probably need to examine production reports by employee, review safety incident reports, review safety training and evaluations from previous studies, attendance reports, and quality inspection reports if available. You will also probably need to interview the employee’s supervisor, fellow employees, subordinate employees, customers, and the employee being evaluated.
Step Four: Initiate the Evaluation
Inform the employee of how, when, and why they will be evaluated.
Evaluate the employee based on the standards explained in number 1.
After the evaluation tools and systems have been developed it is important to let your employees know about these systems, when they will be evaluated, and how they will be evaluated. They should know exactly what you are looking for. For example what improvements you expect a new employee to make during their probationary period, or what skills you expect all of your managers to have. By informing them of these things, you have a reasonable right to expect to see these results when you next evaluate your employees. If the employee fails to meet these expectations then you will have the legal grounds to make a decision to either discipline or terminate an employee.
Once employees are aware of your evaluation systems the next step is to conduct the actual evaluation. This process should not be seen as a quick process that is done once every six months or once a year. Instead it should be seen as an ongoing process. In order to get the most out of the evaluation process, and to support the administrative decisions that you make regarding the hiring, firing, promotion, and raises given to employees, continuous and complete documentation of employee performance is needed. This includes documenting both positive employee performance issues and examples and negative employee performance issues and examples. Events should be documented as they happen in order to avoid omissions and mistakes in documenting the facts of the situation. Employers should maintain a written log of critical events that occur throughout the year. The purpose of all of this documentation is to keep the supervisor focused on the range of behaviors and results that the employee is exhibiting and/or achieving. This will help a lot during the evaluation period, because the recollection of events were only based on what can be retrieved form the supervisor’s memory, then normal performance may be overlooked because of extreme situations that have made a large impression in their mind. Documentation will also help provide employers with specific examples of behaviors that were used in making the decision to promote, give a raise, deny a raise or promotion, or to terminate an employee. These key pieces of evidence can also be used to defend an organization against wrongful termination suits, or complaints about discriminatory practices.
Step Five: Go Over the Results with the Employee
Prepare for the evaluation reveal.
Ask the employee to evaluate himself or herself.
Reveal your evaluation results.
Discuss the results.
The first thing you need to take into consideration when preparing to reveal the results of the employee’s evaluation is how much time it will take. You will want to give the employee as well as yourself an hour before the evaluation meeting to prepare, and one hour for the actual meeting. When you schedule the meeting you will want to have it located in a room or office that is neutral in order to avoid intimidating the employee and avoid putting them on the defensive. You will also want to give the employee a self-evaluation form when you schedule the meeting that they will need to complete before you meet. When preparing for the meeting you will want to go over all of the results of the evaluation and make notes of your impressions of their overall performance as well as specific areas that need improvement or that they excel in. Always start with the good and then go to discussion on where they need improvement. Give specific examples of good and bad things. With these notes in hand you are ready for your meeting.
At the beginning of the meeting you will want to start by reviewing how the evaluation process was conducted, what tools were used, and who did the evaluating. Then go over the results of the employee’s self-evaluation. Next you will present your findings using the notes that you made during the preparation step. After all of the information has been presented then you should encourage a discussion about the findings. Allow the employee to explain or clarify concern or performance problems, or to identify issues that you were unaware of. Finally give the employee a list of things that you want to see improvement on by the next evaluation. Again communications of this kind needs to be in writing and they need to be filed in the employee’s file after the employee signs it. The signature should be below a statement that details that the employee has received a copy of the requested improvements, that they have read and understood that they need to make the listed improvements in their performance by the next evaluation.