Say you manage a restaurant. It’s the summer high season, and it’s been a hectic few months. You know that some of your staff have exceeded expectations, while others need to work harder to reach their potential. But with all the chaos and busyness, how can you evaluate everyone and ensure they’re working up to par?
The answer lies in running and writing performance reviews. After all, you can only excel at managing a small business if you know how to evaluate your employees’ performance.
Performance reviews are the perfect way to officially assess how team members have performed their job duties over a specific time period. They also open the door to exchanging feedback and setting expectations.
Performance evaluations aren’t easy, though — you need to be prepared and know what you’re doing. We’ll cover the steps you should take to conduct effective performance reviews and share tips on how to write them effectively, too.
6 top tips for running employee performance reviews
Hiring and onboarding the right team is only one part of the puzzle — you need to nurture and develop their potential with regular feedback.
Performance evaluations are like annual tune-ups for your car. Just like you take your vehicle to the mechanic to ensure it’s running smoothly and efficiently, reviews provide an opportunity to assess and fine-tune the overall health and performance of your business and team members.
Assessments improve employee retention, boost morale, and create a positive work environment. And here are six tips for conducting them effectively:
1. Exchange regular, informal feedback with team members
Do you know the feeling of being caught completely off-guard by negative feedback? In those situations, you probably wish you’d been given a heads-up.
That’s why regular, informal employee check-ins are so important. They allow you to share feedback in real-time and address issues before they become big problems.
Cultivate a team culture where feedback is valued and encouraged. Make it clear that regular, informal feedback is a normal part of working for your small business and is aimed at growth and improvement rather than criticism or judgment.
Also, instead of solely offering feedback, encourage team members to reflect on their own performance. Individuals can then develop a deeper understanding of their strengths and areas for improvement, fostering a sense of ownership over their growth and development.
You can use Homebase’s employee messaging app to celebrate great work, share shoutouts for a job well done, and casually exchange feedback with one another.
2. Take the time to meet in-person
Getting together with team members face-to-face makes for more meaningful, authentic conversations. It also facilitates clearer communication and strengthens interpersonal relationships.
For instance, if you’re managing a restaurant, handing out an employee evaluation form alone won’t cut it — you need to meet with individuals face-to-face, talk them through it, and have meaningful discussions about their performance in real time.
So, set aside dedicated slots for individual performance evaluation meetings. Make it a priority and ensure you and the staff member will have enough time and won’t be rushed.
Homebase scheduling provides complete visibility into employees’ schedules, so managers can check when it would be most convenient for them to sit down for a meeting — either before or after their shifts.
Also, select a meeting space that’s neutral and conducive to having an open and honest conversation. Consider a private meeting room or an area where you and the employee will feel comfortable and have privacy. Avoid conducting the review in a space that may be distracting or where others can overhear the conversation.
3. Plan what you want to say ahead of time
You don’t want to lose your train of thought or leave out important points during an employee evaluation. So, as soon as you receive a performance review request, set some time aside to plan and structure what you’ll say.
Start by writing down key accomplishments and areas for improvement for each team member. Note-taking ensures you’ll cover all your discussion points and provide a balance of positive and constructive feedback.
Gather and review relevant performance data like sales figures, project outcomes, customer feedback, or any other metrics that apply to the employee’s role. These kinds of concrete numbers will support your feedback, reduce bias, and help you provide specific examples.
Last, if you’re planning to address challenging or sensitive topics during the assessment, consider how you’ll approach them carefully and intentionally. Anticipate potential reactions or emotions and think about the best way to deliver the feedback in a respectful and constructive manner. Be prepared to listen actively and provide support if needed.
4. Don’t shy away from addressing issues head-on
Performance reviews are meant to be a space where employers and employees can exchange feedback and ideas openly. So, be sure to share your views openly and be transparent, direct, and respectful with your perspectives. Avoid harsh criticism, dwelling on issues, or blaming individuals for any issues or mistakes they might have made.
Instead, set a positive tone and create an environment where team members feel safe and supported. Emphasize that the aim of addressing problems in a private assessment is to help them improve and succeed at work. Encourage open dialogue and active listening and assure them you support their professional growth.
When discussing issues, focus on specific behaviors or actions and the impact they’ve had. In addition, ensure you separate behaviors from individuals and make all feedback constructive rather than personal.
Last, avoid using harsh or confrontational language that may discourage or demotivate employees. Instead, opt for language that highlights opportunities for improvement and growth and offers specific suggestions and resources that can help them overcome their issues.
5. Be generous with praise
Praise acknowledges and reinforces positive behaviors, boosts morale, and motivates staff members to perform at their best. Think about how good it feels to receive recognition for a well-done job and apply the same principles.
Use the “feedback sandwich” — a technique where you start and end with positive feedback while sandwiching constructive feedback in between. This approach helps maintain balance and ensures you communicate areas for improvement in a supportive and motivating manner.
When sharing praise, be specific about what the employee has done well. Dive into your manager logbook to find particular successes or tasks individuals have accomplished. For example, Homebase lets you track performance metrics like on-time arrivals and schedule adherence, which provide solid reference points when recognizing team members.
Then, highlight people’s achievements, exceptional performance, or significant contributions and use descriptive language to articulate their impact. For example, explain how someone’s actions positively influenced the team to help everyone understand how their work adds to the business’s bigger picture.
Also, if you’ve received positive feedback about an employee from clients, colleagues, or customers, share it during their performance review. Highlighting positive feedback from external sources adds credibility and further reinforces individuals’ strengths and achievements.
6. Use specific examples
One-size-fits-all approaches just don’t work with most people. That’s as true in life as it is in performance reviews — trying to force employees into assessment boxes and generalized categories simply isn’t effective.
Instead, consider communicating feedback with the Situation-Behavior-Impact (SBI) technique developed by the Center for Creative Leadership. It helps managers share information in a way team members can relate to and internalize.
For instance, someone may feel defensive in response to a comment from a manager like “You’re frequently late” or “You need to improve your work quality.” However, they’re likely to accept and integrate feedback that explains the specific situation, the behavior the manager observed, and its impact.
Let’s consider what that might look like:
- Situation: “Last week during the lunch shift…”
- Behavior: “… there were sandwiches that hadn’t been heated enough to melt the cheese, salads where there wasn’t an appropriate amount of dressing, and sauces that didn’t have the appropriate thickness or saltiness.”
- Impact: “This caused the food quality to be below the standard we expect at the restaurant.”
Wrap up your thoughts with the expectation moving forward, like: “In the future, please monitor food quality more closely before it gets served to customers.”
You can and should apply this technique just as frequently with positive feedback. Telling Sally she goes “above and beyond” might make her feel good, but she won’t know exactly what she’s doing really well that’s worth repeating. Instead, follow the SBI technique:
- Situation: “Last month as Sally was working with customers…”
- Behavior: “… she paid attention to their needs by helping them open doors, remembered regulars’ names, and recommended items based on their interests.”
- Impact: “This resulted in positive feedback online from our customers and increased sales this month.”
This approach requires more effort as you have to think through each employee’s strengths and development needs and pinpoint specific examples to back them up. The result, however, is meaningful feedback that improves staff performance. And you can deliver this kind of feedback as soon as you observe behaviors, so you don’t have to wait until the end of the year to address issues or dish out praise.
How to provide feedback during a small business performance review (with phrases and examples)
Figuring out what to say during performance evaluations can feel delicate, but it becomes significantly easier when you focus on specific skills and behaviors rather than the person’s character. We’ve compiled helpful phrases for delivering both positive and negative feedback that’ll help you make the most of the review process:
Problem-solving skills
Problem-solving skills help employees overcome challenges, work efficiently, adapt to changes, make better decisions, keep customers happy, foster innovation, and work with their colleagues more effectively. They’re like superpowers that keep small businesses running smoothly and thriving despite obstacles.
Imagine a small bakery facing a sudden ingredient shortage. Good problem-solving skills might prompt the owner to find alternative suppliers or adjust their recipes to keep baking delicious treats and satisfy hungry customers.
Positive feedback
- “Great job taking care of that customer complaint! Your ability to listen, empathize, and find a quick and satisfactory solution showed excellent problem-solving skills.”
- “I’m impressed with your innovative approach to our inventory management system. You’ve really helped us do things faster and reduce mistakes.”
- “Your quick thinking and ability to find solutions on the spot are invaluable to our team.”
Needs improvement
- “You could benefit from being more proactive in terms of identifying and addressing issues before they escalate. Try to anticipate potential problems and take steps to prevent them.”
- “Additional attention to detail could take your problem-solving skills up a notch. Be sure to analyze situations thoroughly and consider all possible factors before reaching a solution.”
- “I think prioritizing collaboration and communication would help improve your problem-solving skills. Getting other people’s perspectives and opinions may give you ideas you wouldn’t have thought of otherwise.”
Leadership skills
Leadership skills are like a secret sauce for small businesses. They inspire, guide, and motivate team members. Picture a small café where the owner leads by example, sets high standards, empowers employees, and creates a positive work culture.
Positive feedback
- “I admire your enthusiasm for taking on new challenges. Your leadership skills have helped our small business grow by leaps and bounds.”
- “You’re an excellent listener and a great problem-solver. Your leadership style has been instrumental to our small business moving forward with confidence.”
- “Your strong leadership skills are obvious when you delegate tasks and responsibilities. By recognizing and using all your team members’ strengths, you empower them to excel in their roles.”
Needs improvement
- “Your communication as a leader could be more consistent and transparent. Consider providing regular updates and seeking input from team members to ensure everyone’s on the same page and feels included in decision-making processes.”
- “Try being more assertive in your leadership role. Don’t hesitate to express your expectations and hold team members accountable for their performance. Assertiveness can help drive productivity and ensure goals are met.”
- “I’d like you to work on adapting to change as a leader. Embrace new ideas, technologies, and market trends, and be open to different perspectives. Flexibility and adaptability are essential to lead a small business in a dynamic and ever-changing landscape.”
Teamwork and collaboration
Teamwork and collaboration build trust, promote creative problem-solving, and foster a sense of community among employees. No restaurant or retail business can run smoothly without a team of talented, hard-working individuals working together to achieve goals.
Positive feedback
- “You consistently show what a great collaborator you are by actively contributing to group discussions and valuing the input of others. Your ability to work with others and build on your colleagues’ ideas has led to innovative solutions and successful outcomes.”
- “Your strong commitment to teamwork is evident in your willingness to go above and beyond to support your colleagues. Your collaborative mindset and willingness to share responsibilities have contributed to a sense of unity within our small business.”
- “Your exceptional communication skills have been instrumental in promoting effective teamwork. Your ability to listen actively, share information clearly, and provide constructive feedback has enhanced collaboration and strengthened relationships within the team.”
Needs improvement
- “You could benefit from actively seeking and valuing diverse perspectives within the team. Encourage open discussions and ensure that everyone’s ideas are heard and considered to foster a more inclusive and collaborative environment.”
- “There are opportunities for you to improve your team communications. Strive to be more proactive in sharing information, providing updates, and seeking clarification to ensure everyone’s on the same page and working towards common goals.”
- “You tend to work independently rather than actively collaborating with others. Make an effort to engage with team members, seek their input, and involve them in decision-making processes.”
Attendance, punctuality, and organization
Tardiness disrupts any business — it affects people’s ability to get things done, negatively impacts customer service, and reduces productivity. Punctuality is one of the critical qualities of a good employee, and having small business team members that always show up on time is essential.
Positive feedback
- “Your punctuality sets a shining example for the entire team. By always arriving to your shifts promptly, you demonstrate respect for others’ time and exhibit a strong sense of responsibility. Your reliability is truly appreciated.”
- “Your exceptional organizational skills are a true asset to our small business. You maintain a tidy workspace, effectively manage tasks, and prioritize your workload well, which contributes to a productive and well-structured work environment.”
- “Your meticulous attention to detail and superb organizational abilities are commendable. Your careful planning and diligent deadline tracking ensures projects get completed on time, which alleviates stress and promotes teamwork.”
Needs improvement
- “I’d like you to improve your punctuality and make a conscious effort to get to work on time. Being consistently late causes inconvenience to colleagues and means our team works less productively.”
- “You could improve your organizational skills. It’s important to establish better systems for task management, prioritize work effectively, and maintain a more organized workspace so you can get things done quickly and efficiently.”
- “There have been instances when you didn’t complete tasks in a timely manner. It’s crucial to improve your time management skills and give yourself enough time and space to get through all your core responsibilities.”
Overall performance and work quality
Recognizing and highlighting overall performance and work quality during performance reviews is essential. It shows employees that their hard work is valued, motivates them to maintain high standards, and helps them understand where they need to grow.
Positive feedback
- “Your exceptional work quality and attention to detail have resulted in a significant decrease in customer complaints. Our customer satisfaction ratings have improved by 20% since you joined the team.”
- “Your work quality has had a direct impact on our bottom line. Your error-free reports and detailed data analysis help us make informed business decisions, which has resulted in a 10% increase in revenue.”
- “Your overall performance has been nothing short of outstanding, making a remarkable impact on our productivity. Your ability to consistently deliver high-quality work has led to a remarkable 15% increase in our team’s efficiency, allowing us to accomplish more in less time.”
Needs improvement
- “There have been times when your work didn’t meet our expected level of professionalism and reflected negatively on our business. It’s important to follow established guidelines, use appropriate language and tone, and consistently produce work that reflects our brand values.”
- “Your overall performance has been inconsistent in terms of quality standards, resulting in delays and you having to do things over again. It’s crucial to pay closer attention to detail.”
- “You’ve done good work, but there have been times when you’ve struggled with adaptability and flexibility when things shift. It’s crucial that we all learn to embrace change and stay receptive to fresh perspectives. Cultivating a growth mindset keeps our team strong and successful through any challenge.”
Build a positive communication culture with Homebase
A company culture that thrives on collaboration, punctuality, positive feedback, and high-quality work is invaluable for small businesses. And highlighting strengths and areas for improvement during performance reviews keeps employees motivated to maintain high standards while providing them with specific feedback to grow and develop professionally.
However, performance reviews are never a one-and-done type of deal. Maintaining an open line of communication with team members and fostering a culture that values feedback and rewards excellence is crucial.
Homebase’s team communication tool and handy mobile app can help you keep in touch with staff before and after reviews — and always. That’s one important piece of the puzzle when it comes to cultivating an environment where employees feel supported, heard, and motivated to perform at their highest level.
Remember: This is not legal advice. If you have questions about your particular situation, please consult a lawyer, CPA, or other appropriate professional advisor or agency.
