How to Use Performance Reviews to Keep Loyal Employees on Your Team

By Jason Bland, co-founder of Custom Legal Marketing, a law firm SEO company that helps law firms thrive in highly competitive markets.

Performance reviews are underused by many small business owners. Those who prioritize reviews often do so in ways that are off-putting and can demoralize their workforce, leading to greater attrition.

Many years ago, I decided to ignore all expert advice and instead frame our performance reviews the way it worked for my law firm’s marketing agency. Fast forward to the present and we have incredibly low turnover and even retained the majority of our core team members through the challenging years of COVID-19.

Here’s how you can use performance reviews to keep your best people on your team.

Make it a two-way check.

This is the best thing you can do as a manager or business owner. The appraisal interview should not be one-sided. There is someone sitting in front of you who sees your company, your customers, your business and your market from a slightly different perspective. Not listening to their observations is a huge loss of opportunity.

The appraisal interview should be a free space for the exchange of ideas and criticism. Allow and accept criticism of your operations and leadership style, and use those insights to solve problems you may not have known about.

have benchmarks.

After each review, there should be a list of expectations and benchmarks for the team member to achieve at your next review. This could mean adding new skills or encouraging them to use a talent they have but aren’t that excited about.

For example, we have one team member who is an excellent writer, although that’s not part of her job in any way. But she is very talented and she could use that talent to contribute to our promotional content and help us attract new customers. So a benchmark for them might be to contribute content to our blog before our next review, or to guest post with a partner publication.

Give plenty of notice.

In my company, I’m known for requesting last-minute meetings that leave almost no time to prepare. It’s a professional mistake that I’m working through. But when it comes to performance reviews, give your team members three to four weeks to prepare.

Let them know what kind of questions you will be asking and remind them of benchmarks discussed in your last review. This allows them to show off their work and maybe even shed light on their areas of growth that you may have missed. This is an excellent way to spot emerging talent in your team members or identify them as good candidates for future opportunities.

Invest where you can and communicate when you can’t.

When conducting a two-way performance review, you may find that your employees need some investment.

When it comes to one-time investments (tech upgrades, convenience items, efficiency tools), I rarely say no. The value of keeping a great team member on board far outweighs anything that comes with a one-time cost.

If your employee is looking for a major 401(k) match or something that would be a company-wide investment that just doesn’t work with your current cash flow, don’t ignore their request. If it doesn’t work, it doesn’t work. You can offer an alternative benefit or reconsider the request at the next review. At this point, your cash flow may be in a better position to support a team-wide investment.

Always communicate honestly.

By turning your performance reviews into an open conversation, you can be more successful at keeping your top performers on your team. Your willingness to listen and invest in your professional growth isn’t just good for your bottom line. It helps you create a more positive work environment that’s good for you, your managers, and your employees—and that translates into a better customer experience.

The opinions expressed here by columnists are their own and not those of

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