Annual performance reviews have become such a routine part of business that it’s sometimes easy to forget why we even do them. We end up filling them out by just going through the motions instead of remembering that performance reviews should encourage and motivate employees. To bring us all back to the true heart and soul of a performance review, we wanted to highlight the basic goals and purpose of this annual end-of-year ritual. Download the ebook “The Skeptics Guide to Performance Management and get started on improving your performance management process.

Performance Review Goals

Why They Matter

Performance reviews are about communication. They are a chance for management to lay out a clear plan of action for the company and explain their expectations to an employee. But, more than that, performance reviews are a chance to encourage employees to develop themselves. Keeping reviews positive where possible keeps employees satisfied and focused over the course of their careers. They’ll leave the review knowing where to improve and what the company is looking for.

Keep Your Purpose in mind

Motivate Employees

A performance review is the best time for management to lay out exactly what their expectations are. Employees should leave their performance reviews knowing what they need to achieve in the coming future. When employees understand the results they must obtain, they work harder to benefit the company.

Build Up Employees and a Better Organization

Keep in mind, though, that a performance review is more than just a war room to discuss strategies. It’s the time and place to address where employees have room to grow. No one comes into a company ready to take on the bulk of the work, but showing an employee the steps they can take to improve and develop their skills offers them a ladder to move through the ranks and take on more responsibility. When an employer shows their willingness to develop their employee, the employee can commit to working toward those goals.

Cover Yourself and Your Employees

Performance reviews should be well documented, noting down where both employers and employees have set their goals. Documentation should always be clear and cover as much detail as possible. When employers state and document exactly what they want, it acts as legal evidence that they have played a role in their employees’ development. It protects them from accusations of discrimination in the workplace. Alternatively, if employees need more wiggle room to reach their goals, the review can act as the basis of an improvement plan.

Be Specific About Your Goals!

When developing a performance review, the purpose and goals should be specific, relevant to the company’s objectives, measurable AND achievable, and timely. The following goals should be at the heart of any review.

Employee Productivity

Productivity is the heartbeat of a company. Productive employees produce more results in less time, helping the company grow larger before the end of the year. Productivity should be measured based on results, not just the sheer volume of work. Producing quantity without quality is a prime example of inefficiency.

Employee Efficiency

Time is money, and money is business. Employees who can maximize their results in a shorter amount of time will, of course, be more productive and profitable. However, efficiency means more than just working quickly. It also means working well. It may be easy to pump out 100 broken products, but they will still be outsold by a single quality product.

Employee Training

Employees like to know that their company has their best interest at heart. Providing educational resources and setting educational goals motivates employees to continue pursuing higher positions within the company. And not only do educational milestones benefit workers, but they also benefit the company in the long run. More educated and more trained employees equal more productive and more efficient employees.

Better Interpersonal Skills

At the end of the day, business is all about selling. Without communication skills to help sell, a business is only as good as its best product. Encouraging and pushing employees to boost their interpersonal skills within the company will foster a healthier work environment and boost sales.

Critical Thinking Goals

Employees who want to move up through the company have to have the wherewithal to problem-solve on their own. Encouraging employees to grow and develop broader critical thinking skills gives them the tools to grow within the business.

Organizational Skills

Good record-keeping and the documentation of every little detail is vital to the constant stream of information that goes through a company. Identifying where employees need growth in their organizational and documentational skills can help root out any blind spots in the business. This is crucial when it comes to audits or going through the historical record.

Identify Up-and-Coming Leaders

Performance reviews are about more than just fixing bad habits, they’re also about finding rising talent. Go into a performance review looking for who deserves the next raise or promotion. Potential leaders will stand out among the pack and will be dedicated to working towards their goals.

Talk About Attendance

While it may not be necessary to bring up work attendance with every employee, when it is, you’ll know. Punctuality is a hallmark of professionalism, and if an employee has been late to work for 7 of the last ten workdays, it may be a sign that they are not committed to their work. Be sure to clearly define when the workday starts and when it ends. Only in pre-discussed circumstances should employees be clocking-in or -out late/early, respectively.

Time Management

Coming to work late or leaving early are not the only possible time-related points of issue. Lay out clear expectations for when employees should meet their deadlines. Again, time is money, so if employees are not finishing their work when a client expects it, the client will be more inclined to take their work elsewhere next time.


Working these goals into your annual employee review will not only cover you and your employees, but it should help motivate workers and build up the business. Just because employee evaluations are a necessary part of the job doesn’t mean they have to become rote. Revamp your employee evaluation and let it benefit your entire organization.