OKRs and monitor employee performance: Help or hindrance?

by Carly Clyne | Dec 10, 2021

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In simple terms, employee performance is how a member of staff fulfils the duties of their role and completes required tasks. A measure of performance can include the quality, quantity and efficiency of work.

By conducting regular employee performance reviews and evaluations, leaders can paint a picture of how the business is performing. However, placing a focus on employee performance doesn’t just benefit the business, it helps employees to reach their full potential, while also improving overall performance. This can also have positive effects on morale and the quality of work produced. But should you consider OKR performance when conducting these reviews with your employees? We’ll answer this question in this article.

Why are employee performance reviews important?

By having an employee performance review system in place you can help to bring the best out of your people and ensure your business is running smoothly. You could create an individual or team performance plan off the back of your review to outline the tools and resources you’ll use to improve your employees’ performance.

It gives the chance to gauge whether employees are achieving expected levels of performance and to offer them important feedback, guidance, and encouragement.It also gives you the chance to identify and address poor performance and steps to rectify this.

A global study of companies by Gartner, found that employee performance was 10% lower in organisations that don’t conduct reviews. The lack of regular feedback and recognition was especially detrimental to high-performing employees, whose productivity was 28% less.

Employee performance reviews are a great way to identify and nurture your talent. They provide a view of how your workers are doing in the development of their skills, knowledge, initiative, and engagement with the company’s vision.

By looking back over a person’s work history, you can identify whether they are ready to take on greater responsibility or have any skill gaps and require additional training. 

This ongoing record of an employee’s strengths and weaknesses enables you to fine-tune a career path within the company where they can put their talents and interests to best use.

Your people will be more invested in the business, and by promoting internally, the company retains all the organisational knowledge they have built up.

How to conduct an employee performance evaluation

Provide regular, informal feedback

While employee performance reviews typically happen once or twice a year, feedback should not be limited to those short review periods. You should offer consistent assessments throughout the year so there aren’t any surprises when it comes to review time. 

It should not be the first time an employee is hearing from you that they are not performing as expected. Be clear in writing and set expectations and the tone for the meeting.

Don’t forget about your top performers. If you’re only addressing issues or focusing on the employees who aren’t performing as well as others, you’re missing an opportunity to express gratitude to those who shape the innovation, creativity and culture within your company. You don’t want these employees to lose their passion or motivation if they are not occasionally recognised. 

Be honest

If you know an issue is affecting your team, tiptoeing around the subject won’t get you anywhere. It’s important to deliver feedback in a way that you would want to receive it. 

Conduct the review face to face

You might want to schedule a meeting in a coffee shop or out-of-office location to provide a comfortable atmosphere. When it comes to reviewing remote workers, schedule a video chat so you’re still having a live conversation. 

Employee performance reviews are too important to relegate to email or telephone. Doing so would send a signal that you didn’t care enough about the subject to even take the time to meet.

End on a positive note

Use the review process as an opportunity to set goals specific to addressing the expectations the employee isn’t quite hitting, but which also makes the employee feel like they have a clear plan of action that can get them back on track.

Positive reinforcement and constructive feedback can go a long way in giving employees the confidence and drive they need to perform better.

Employee performance trackers & metrics

When used for motivation and reward, employee performance evaluations have a negative impact on the very performance they seek to enhance. All this has resulted in a trend towards a more “check-in” based approach – i.e. “little and often” conversations. The traditional “big conversation” at the end of the year is highly likely to be emotionally charged and is unlikely to impart a sense of fairness when evaluating performance, which in some cases could have occurred 10-12 months ago.

As much as we love OKRs, they are not synonymous with employee performance evaluations. Evaluating how an employee has performed in a given period should be independent of their OKRs. Directly linking OKR achievement to pay & reward is the quickest way to ensure people play safe and resist any possibility of failure; they just simply won’t take risks, this is why we highly recommend that you don’t take this approach.

We recommend a holistic approach to performance motivation and evaluation. If you have defined what high-performance means in your business then building a frequent check-in conversation to focus on this is incredibly valuable. We recommend having them monthly and aim for 30 mins and no longer.  Over a year, you’ll build up 12 snapshots which you can then bring together to help make an annual decision if needed on pay & reward.

In short, we strongly recommend NOT adopting the policy that everyone in the business should contribute towards OKRs all of the time. OKRs are there to aid agility and that means being able to flex where the focus needs to be. If you force them on all, you will massively dilute their benefit.

How we can help

OKRs change how success is defined and communicated so your team know what they are working towards, the reasons behind why they’re doing things and their individual

contribution to the objective. OKRs can revolutionise the approach your business takes towards performance management. Start your journey to a more successful business with a call with one of our Giants today.