Why performance evaluations are vital for businesses

Updated: Nov 6


Constructive and purpose-built performance evaluations are vital to the success of employees and, therefore, to the success of the organization. When designed and executed to evaluate current business practices, staff progress towards predefined goals. In addition, these reviews can be used as tools to calibrate expectations to reach our business objectives, performance evaluations become a healthy mechanism to improve overall business results. However, when performance evaluations are done to “check the box” on some compliance program requirements, these tools tend to have adverse effects, usually turning into undesired and unsolicited sessions at the end of each fiscal/calendar year.  

Business goals should be drafted, finalized, and socialized at the beginning of the year to ensure the employees to be measured against those goals can incorporate them into their business performance. 


When employees are very cleared as to what is expected of them, they should make every effort to understand these expectations, assess his/her ability to meet such expectations, ask for clarification or assistance if needed, and ultimately delivered the expected results. 

Successful performance evaluations offer the opportunity to examine critical elements of any successful business including; 


  • Review predefined business objectives.

  • Engaged with assigned resources.

  • Assess progress made towards goals.

  • Praise employees on a job well done.

  • Identify areas of improvement.

  • Build an action plan to resolve issues.

  • Calibrate expectations to synchronize progress made, goals and timeline.

  • Schedule follow up meetings.

  • Go back to the overall business objectives and determine if updates are needed.


When these points are addressed during performance evaluations, the business is recharged with progress, new information, and updated business strategies.  

Some of the key benefits of well-structured performance evaluations are; 


  1. Clarify miscommunications to meet business objectives.

  2. Recognize under-performers and provide assistance.

  3. Improve decision-making process by having detailed information.

  4. Creates an opportunity to obtain management attention.

  5. Realign business plans that could have deviated from management objectives.


Performance reviews are essential business tools for managers and supervisors to conduct a pragmatic assessment of the business by reviewing business objectives, predefined goals, check on staff job responsibilities, measure progress towards goals, calibrate expectations and turn our operations into a successful business. 


Let’s make sure to prepare for and conduct productive performance reviews and aim to find ways to improve our business. 


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