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Rethinking Annual Employee Reviews

Annual employee reviews are useful tools that both large and small organizations use. Done correctly, these reviews can increase productivity and employee satisfaction because the expectations regarding their performance are clear. However, the reality is that there are a lot of companies that make a lot of mistakes regarding the use of annual employee reviews.

Many businesses fail to take the employees’ concerns into account when conducting the annual reviews. It is important for managers to provide regular feedback, conduct personnel meetings and allow employees to improve their performance throughout the year.

Insurance agencies and other types of businesses can benefit greatly from using employee reviews. In this article, we’ll take a look at the issues that small and large agencies face when it comes to conducting performance reviews and how these problems can be addressed.

Small and Large Agency Annual Employee Reviews

Whether you are running a small agency or a large company, it is important to follow best practices when it comes to doing performance appraisals. But there are generally differences in the approach of small businesses and large organizations when it comes to evaluating employees.

Small businesses tend to have an informal process when it comes to employee reviews. Generally, the owner of the business may have a short meeting with the employee to discuss their performance throughout the year. While this approach may be more personal, it also lacks structure which can lead to confusion on the part of the employee.

On the other hand, large organizations tend to have a more formal approach. The interaction between management and staff can sometimes become very impersonal, which makes it easy for assumptions to be made. For example, if a manager only sees an employee during the weekly meeting then that’s the only chance for the employee to make a good impression.

Also, the lack of interaction means that the most recent events prior to the evaluation are given heavier emphasis than maybe they should have received. It is important to be aware of the innate bias that comes with timing. If an employee recently performed very well on a project but had lagged throughout the year, it is essential to consider if he still requires additional training. It’s also important not to penalize a top-performing employee for a recent misstep.

Improving the Effectiveness of Employee Reviews

It is important for managers to realize that employee reviews do play a big part on an employee’s job satisfaction. If they feel that the review was not fair, it would affect their work productivity. For this reason, it is crucial to ensure that the reviews reflect actual performance and that the employees are fully aware of what is expected of them during the course of the year.

There are general guidelines that both small and large organizations can follow. The tips below can make end-of-year employee appraisals more effective:

  • Provide consistent and constructive feedback – There is no reason to wait for formal appraisals to provide feedback. Praise or critique an employee’s performance as required. This will enable them to improve their work and meet the company’s expectations. It may be a good idea to have weekly or monthly check-ins to see how the employees are coming along with their work.

  • Document employee performance throughout the year – Writing down notes about the employee’s work throughout the year will make sure that the annual appraisal reflects that individual’s true performance.

  • Keep job descriptions current – Job roles evolve over time. It is important to define the employee’s current job role and goals. It allows for fair and complete assessment of his or her performance.

  • Discuss each employees appraisal – Rather than submitting the employee review immediately to senior management, the employee’s direct manager should consider discussing the appraisal first. It gives the employee a chance to clarify certain points.

Employee Relationships

Employee reviews shouldn’t replace relationships. Employers should take the responsibility of discussing performance problems with the employee. It is understandable for owners and managers to want to keep things friendly, however, having a personal relationship with the employee should only go so far. There is also the risk that employees will be treated inconsistently, which can prove demotivating for others. For this reason, it is essential to focus on employee development and document each person’s progress over time.

Employment problems should also be discussed and addressed. Failing to put these issues into writing may imply that the company is not taking the issue seriously. Remember that avoiding performance issues can become a very problematic issue for your company. There is a risk that it can become part of the company’s culture, which in turn can damage the long-term growth of the organization.

Employee reviews are an important tool that should be used on a regular basis. Both large and small agencies can benefit from theses insurance agency tips outlined, and implementing the suggestions in this article for your organization will yield improved results when it comes to employee performance. It’s definitely time to take employee reviews seriously.

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