What is the biggest asset in your business?
Good employees are valuable in any small business. Even if you don’t employ anyone right now, you will. Employees scale your business, doing what you alone cannot do.
Good employees can mean added productivity. They can mean experience. Good employees can help you grow because they become integral to how your business serves customers. Good employees make your business capable of growth because they do more work than you can, and they can be used to supervise and train even more employees as the need to hire continues with growth.
In time, good employees take over management, and you can finally achieve your dream of running your business – without fixing the nuts and bolts every day!
How do you build a team of good employees?
You do have to make sure that you do a number of things right.
You need to use the best recruitment procedures, to ensure that you not only choose people who have the skills you need, but who also fit into the way you do things in your business.
You need to organise them so that they know what they have to do and are clear on their roles and responsibilities, and career paths.
You need to manage them so that they feel they are learning and growing. It is said that people don’t resign from companies – they leave bad supervisors.
You need to provide leadership.
You need to employ effective methods to ensure the best performance is available from your employees.
You need an effective Performance Review System.
But in order to implement an effective staff performance review system, you first need to have something against which to measure.
This means that you need Statements of Position Descriptions that describe each individual’s roles and responsibilities and daily duties.
Against their responsibilities you should include performance measures so that everyone knows from the start how they will be measured. Their performance measures should be tailored to the successful meeting of their responsibilities, setting targets, and outlining standards of behaviour. As far as possible they should be objective and quantitative.
They can be qualitative, as long as they are also objective and not dependant on individual interpretation.
Here are some examples.
For a salesperson: –
- To increase sales from your sales area by 10% per annum;
- To provide monthly reports of prospects and how you will convert them;
- To meet existing customers once a fortnight;
- To return all phone calls within 24 hours.
For the receptionist: –
- All phones are answered within 3 rings;
- All mail is opened and distributed by 10 AM every morning;
- All phone messages are delivered immediately after hanging up;
- All visitors to be greeted and the appropriate person meeting them informed immediately.
Once these performance standards have been established within the employees’ position descriptions, the performance review system can be designed to discuss, improve, and reward performance, or to change behaviours to attain the standards.
The most important part of a Performance Review system is consistency.
Whenever and however often you decide to hold interviews to discuss performance, they must happen as publicised, regularly and on time.
Appointments need to be made and treated as important. It is unforgivable to miss these appointments. Doing so sends the message that you don’t really care about their performance, even if you say you do.
When you conduct these Performance Review interviews, you should have a standard checklist of items to discuss.
The checklist should include: –
- A discussion about informal changes to the Position Description that need to be formalised. On a day-to-day basis, some variations to responsibilities might creep in because of changing circumstances. Record these so that you can truly check performance.
- A discussion on setting, with their input, performance objectives for the next period. Employee-agreed performance objectives are about how they would like to improve performance or learn new skills to develop their careers, not necessarily about their performance measures.
- A discussion on whether they met the performance objectives for the period being reviewed, that were set at the last review.
- A discussion on how they found their work in their area(s) of responsibility. This discussion should give ideas about room for improvement as well as feedback about any changes to systems, policies and work procedures.
- A discussion about their performance measures. The discussion should focus on how to improve.
- Note any significant contributions the employee has made to the business and make sure they receive thanks.
- A discussion on their career plans – what they aspire to, what they will do to attain that, and what the employer can do to assist.
- A discussion on rewards and remuneration.
- Summary, including what they will do and what you will do in the next period.
The Performance Review system should not end at the end of the interview.
Keep good records and notes of what was decided so that you and the employee can check from time to time that what they said they would do – and what you said you would do – is being done.
You, and any responsible managers, should make sure that they are providing constant feedback on the job. For example, if the salesperson is not meeting customers once a fortnight as established as the measure, then this should be pointed out to them while referring to their position description. A discussion about responsibilities not being met, and how to better meet them, should be an ongoing discussion. A Performance Review system should provide people with timely feedback, not only once a year when the behaviour may already have been established, and when the negative effects of poor standards may have already affected the business.
At the same time, any positive behaviour seen should be reinforced immediately with praise and not await the meeting at the end of the year.
If you implement the performance review system early, it becomes a really positive enhancer of performance.
Along with defined position responsibilities and the organisation chart that shows them how they contribute to the whole business, a fair performance review system builds a high-performing team. Exactly what you need in a small business where everyone pulls their own weight and contributes to the business’ success!
Do these things right and you will build an effective team that is loyal, capable of meeting all objectives, and capable of helping you to grow your business.
Remember, making sure your employees perform at their best is not a chore – whatever you do to help that happen will build real assets in your business. Your employees will be those assets, returning a real return on investment in time and effort.
You can take a moment and implement your Performance Review system right now, following these principles.
And, in fact, if you go to my blog at teikoh.com, you can get many more effective strategies that you can implement immediately to help grow your business. The best way is to join in and let me send you these invaluable tips and tools and strategies directly to your inbox – right here.
See you there, and see you soon!