Employee Appraisal: Definition, Process & Best Practices
Employee appraisals are a structured, evidence-based way to assess performance, recognise achievements, and support continuous development. This article explains what an employee appraisal is, outlines the modern appraisal process, and shares best practices and examples to help managers deliver fair, motivating, and forward-looking performance reviews that drive engagement and organisational agility.
Understanding how to conduct employee performance appraisals effectively is crucial for leaders who want to deliver fair feedback, boost engagement, support continuous development and build strong and agile teams.
Key Aspects of an Employee Appraisal
The employee appraisal, also known as a performance review, is a structured evaluation designed to assess how well an employee has performed over a set period. A good appraisal is fair, evidence-based and naturally retrospective but also motivational and forward-looking. The key aspects of an employee appraisal typically include:
Performance Against SMART Goals
A staff appraisal evaluates how well the employees performed their agreed objectives. These objectives should be set following the SMART format, which is one of the most important employee appraisal best practices. SMART stands for: Specific, Measurable, Attainable, Relevant and Time bounded. An example of a SMART objective is shown here:
“Reduce monthly customer attrition scores from 50% to 40% by the end of Q3 by improving response times, updating customer service policies, and providing team conflict management training.”
Competencies & Behaviours
Employee appraisals also assess how the work was carried out based on behaviours such as communication, teamwork, problem-solving, adaptability, leadership, and alignment with company values. Having a broad range of behavioural dimensions can build more rounded employees.
Strengths & Achievements
Employee appraisals must also highlight standout contributions, successful projects, and areas where the employee adds value to the organisation. When providing feedback, managers must remember to recognize achievements. Recognition is a key part of effective feedback and is crucial to employee engagement in the process and to the employee being receptive to any negative feedback.
Development Areas & Training Needs
The employee appraisal process should also identify skills gaps, and outline specific learning interventions such as training, coaching, or stretch assignments. These are often recorded in a personal development plan. The emphasis here must be on constructive feedback which means explaining shortcomings and potential remedies clearly but respectfully, and in a way that motivates the employee and inspires them to learn and improve.
Future Goals & Career Growth
Another key aspect of the appraisal process is objective setting for the next review cycle and discussing long-term career aspirations, career progression pathways, or new responsibilities. These may also be recorded in the personal or career development plan.
Employee Appraisal Examples
Employee appraisal examples are sample comments, evaluations, and performance statements used during performance reviews to assess an employee’s behaviour, achievements, and development areas. Anonymised employee appraisal examples can often be found on the internet in expert HR articles or within your HR knowledge base.
These examples can be helpful for more inexperienced managers looking to find the appropriate language and phraseology to provide inspiring feedback to their staff. We have included some typical employee appraisal examples UK organisations often use.
Teamwork & Collaboration
“Always willing to support colleagues and contributes positively to team culture.”
“Builds strong relationships and resolves conflicts constructively.”
“Needs to participate more proactively in group initiatives.”
“Should work on being more receptive to new ideas.”
Engineering these responses so they are direct, yet sensitive and motivational can be tricky and time-consuming. If you’re looking for more employee appraisal examples UK organisations can use, then deploy a best of breed employee appraisal software from the UK as these usually contain a library of UK-centric positive and negative statements you can choose from and quickly insert into reviews. This streamlines the employee feedback process.
Employee Appraisal Process
The Employee Appraisal is a cyclic performance optimisation and personal development process, starting and ending with the setting/adjustment of SMART goals.
SMART goal setting/adjustment. The line manager agrees on a set of SMART performance and learning goals with the employee. Performance goals motivate employees to optimise performance and learning goals encourage personal and professional growth.
Employee performance review: At the scheduled review meeting, which can be quarterly, monthly or even weekly, the employee’s actual performance is assessed against the performance and learning goals.
During the performance review strengths are recognised and positively reinforced and constructive feedback is given based on weaknesses. Recognition is an important part of the more frequent modern employee appraisal process as research from Gallup shows that “frequent recognition enhances the impact of frequent feedback”
Personal and Career Development (PDP): The employee discusses their personal and career aspirations with the manager and agrees to corresponding learning and competency goals. This is recorded in a personal development plan and is crucial as research cited by Dr Bob Nelson, (expert on employee recognition) on Linked-in’s Pulse reveals that investment in learning and growth is a key driver of employee retention and as a results PDPs have become one of the most valuable employee appraisal best practices.
Goal Setting. Assign new goals and/or adjust existing ones and return to the start.
Benefits of Modern Employee Performance Appraisals
The modern employee performance appraisal process has moved beyond the once-a-year annual review toward a digitally enhanced real-time performance monitoring process, where performance is assessed and managers provide feedback on a quarterly, monthly or even weekly basis. When adopting these modern appraisal techniques, the benefits of staff appraisal become much clearer as shown here.
More effective behaviour change
The purpose of the performance appraisal process is to optimise performance by setting goals and providing feedback against those goals. Modern appraisal techniques require that reviews occur more frequently, (at quarterly or even monthly intervals), shortening the time between behaviour and feedback. Research from Gallup shows that feedback is most meaningful and therefore effective when it is “timely, authentic and part of frequent check-ins’, showing that modern high frequency appraisals are more effective at behaviour change.
Create a more agile organisation.
The volatile and changeable business ecosystem that we inhabit means that companies must be able to quickly adapt to changes in the competitive landscape. In the modern appraisal process therefore, review meetings occur more frequently meaning that team and employee objectives can be quickly changed in reaction to changing external events, making this another one of the key benefits of staff appraisal.
Increased Employee Engagement
The modern performance appraisal process can deliver quality feedback more frequently (thanks to AI automation and enhancement of the goal setting and feedback process). Feedback is more ‘meaningful’ as a result and this will lead to an increase in employee engagement as further research from Gallup showed that employees who receive “valuable feedback “more frequently from colleagues are much more likely to be engaged.
They also found that this environment of more meaningful feedback afforded by the modern employee appraisal environment meant that employees were “57% less likely to be burned out” and 48% less likely to be looking for another job.
FAQs
An employee appraisal is a formal meeting usually between an employee and their line manager where the employee’s performance is assessed against agreed performance goals over a specific period, using a formal rating scale.
Employee appraisals exist to help employees perform at best It is part of a structured performance management process where managers set performance goals, agree development priorities and review progress regularly. By giving employees clear expectations, constructive feedback and opportunities to grow, employees become the best version of themselves.
There isn’t a standard best practice around appraisal frequency; it would depend on the type of organisation or role. Arguably however, the traditional once-a-year annual review is becoming one of the most outmoded appraisal methods given the VUCA (Volatile, Unpredictable, Changing and Ambiguous) dynamics of the modern world which reward responsiveness and agility. Companies like Adobe (with their quarterly checkins), and Google (with their quarterly OKRs), both digital organisations have settled on appraising staff at least four times a year. Adobe’s publicly downloadable high-frequency employee appraisal toolkit has become one of the most industry-recognized employee appraisal best practices. Real-time employee performance monitoring, including regular feedback on at least a quarterly basis, is now the norm.
1. One of the most used appraisal methods is the traditional top-down type of appraisal where line managers evaluate subordinates based on pre-established goals.
2.Self-Assessment is where employees write their own performance reviews based on a set of prompts and questions. This empowering approach can encourage employees to be more self-reflective and more personally accountable. This exercise in self-reflection is usually combined with a top-down appraisal.
3.The 360-Degree feedback appraisal is becoming increasingly popular, and it involves collecting feedback from not only the line managers, but peers, subordinates and potentially clients and suppliers. This offers a comprehensive view of the employee, and as a result 360-degree feedback can be an excellent personal development tool.
An employee appraisal should at the very least discuss 4 main things:
1.The employee’s performance over the agreed review period, typically based on performance and learning goals.
2.Any obstacles or barriers the employee is facing, e.g. lack of budget, skills, resources or time and the possible interventions and remedies that are needed to overcome these problems.
3.Setting goals (or modifying existing ones) and agreeing them with the employee. These goals should be SMART, meaning specific, measurable, attainable, relevant and time bounded.
4.The employees’ future career and personal development aspirations should be discussed and then learning and experience goals should be set in line with this.
5.Date of the next employee appraisal.
When considering how to conduct employee performance appraisals in this modern environment of real-time performance monitoring, technology must be part of the equation. This is because employee appraisal software automates many of the numerous, repetitive tasks associated with a real-time appraisal process and introduces massive labour-saving benefits as a result.
Appraisal form design, objective setting and assessment, document management, scheduling appraisal meetings can all be fully or partially automated by AI-powered technology.
Annual employee appraisals are widely considered an outdated concept. Results of a poll reported on the CIPD’s People Management Magazine online show that 48% of companies surveyed conducted at least 3 employee performance evaluation meetings per year with staff. This regular feedback ensured that employees felt more valued by the company and better coached.
A good employee performance appraisal embodies modern appraisal techniques and would have the following qualities
– It is agile and responsive and occurs at quarterly intervals at least, ensuring regular feedback.
Includes SMART objectives covering both performance goals and learning objectives and reviews performance against those objectives using a rating scale.
– Constructively discusses employee weaknesses and areas for development
– Includes a career development planning element or personal development plan to guide future personal growth.
– Streamlined, efficient process, incorporating an online appraisal form into a performance management technology ecosystem.
The five most important words in the modern performance review are: Specific, Measurable, Attainable, Relevant and Timebounded. (SMART). Modern appraisal techniques incorporate these SMART objectives and regularly assess employee performance against those SMART objectives, typically on a quarterly basis.
