In my previous article, I discussed the key steps for successfully bringing a new employee into your firm. Let’s now turn to the best practices for evaluating and compensating employees.
Evaluating employees
An employee evaluation should never be a surprise. If you have an issue with a staff member, don't wait until his evaluation to discuss it. The same goes for praise. If your staff member is doing a great job, don't wait to tell him. Be specific in your praise. Don’t say, “You are doing a great job.” Instead say, “I really appreciate the way you are able to diffuse an angry client.”
Be sure you have a concise job description, provide clear expectations and have determined an appropriate time line for learning new tasks. A vague job description or expectations don't provide the necessary framework for a successful outcome.
Sit down with your staff members on a regular basis. Quarterly should be sufficient after their first year on the job. Use a short evaluation for the quarterly check-ins and a longer, more thorough version for the formal, annual evaluation. Develop a plan to remedy any problems.
Ask your staff member to complete a self-evaluation before you write your evaluation. You want to see where you are in agreement and more importantly, where you may have differing opinions.
Questions to have your staff member complete for their self-evaluation:
- What do you think you are doing well?
- What would you like to be doing better?
- What do you need help with?
- What would you like to change?
Other questions to pose:
- What will your main focus be for the next three months?
- What new discoveries (or items of learning) are you planning?
- What new partnerships (or relationships) are you hoping to build?
Credit goes to Marcus Buckingham & Donald O. Clifton, Ph.D. for these last three questions as written in their book, Now, Discover Your Strengths, a follow-up to Marcus’s book First, Break All The Rules, which was co-authored with Curt Coffman.
As the leader, your job is to guide, coach, tutor and provide vision, doing whatever is necessary for your employee to succeed. You and your employees are jointly accountable for the quality of their work. If anyone on the team is not doing well, it might be a reflection on your ability to provide the necessary environment, training, and tools to succeed.
Rewarding employees
We’ve all heard reports stating how beneficial it is to retain good people. Turnover is costly to any company, not just in terms of dollars, but to morale and in customer perception.
If employee retention is so important, why do so many companies fail while a select few are crowned as the best companies to work at?
Start by rewarding your employees fairly. This does not necessarily mean equally, as each employee places a different value on the various components of the compensation package. And, each employee will deliver on their job duties at a different pace and on a different quality level.
As we look at Abraham Maslow’s Hierarchy of Needs, a theory in psychology he proposed in his 1943 paper, “A Theory of Human Motivation,” we see that after basic needs are met and employment has been secured, a sense of belonging, a sense of achievement and a sense of being respected are driving forces.
Abraham Maslow’s Hierarchy
Not all rewards need to come in the form of monetary compensation. Some employees appreciate recognition in front of their peers and managers. Others prefer additional time off. Some may prefer to attend special training sessions to improve their industry knowledge or learn a new skill. Still, others might prefer an ownership stake in the company.
If you are unsure what the employee would appreciate, find out the person’s hobby or outside interest and give an appropriate gift, or ask the employee himself or a close colleague what they would like as a reward. Bottom line, match the reward to the individual and to the achievement.
If you want the employee to continue doing the action or behavior that led to the recognition in the first place, make sure the reward is timely and specific. Don’t wait four months until his employee review to let him know you appreciate his effort. Encourage him right away to do more of the same.
Don’t forget, your employees have control over their actions, but can’t necessarily control outcomes. Reinforce the behavior you want irrespective of the outcome. If the outcome you desire is achieved, you can reward the results as well. But, by all means, reward the behavior.
Not all employees will perform at the same level as your stars, and some may, unfortunately, be lack-luster employees. Be sure to give positive acknowledgement and encouragement to the producers, and be careful not to reward the idle. Do provide lower producers the opportunity and encouragement to improve.
Remember to recognize and thank people who recognize the contributions of others, for these are the people who make others feel a sense of belonging, a sense of achievement and a sense of being respected.