How to Conduct a Performance Appraisal: 4 Steps

This article is an excerpt from the Shortform book guide to "High Output Management" by Andrew S. Grove. Shortform has the world's best summaries and analyses of books you should be reading.

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Do you want to know how to conduct a performance appraisal? What’s the best method for performance reviews?

A difficult part of being a manager is learning how to conduct a performance appraisal. By following the steps in Andrew Grove’s High Output Management, you can conduct appraisals that are helpful and effective.

Keep reading to find out how to conduct a performance appraisal.

How to Conduct a Performance Appraisal

Below we’ll cover how to conduct a performance appraisal. It’s important to have a well-established system for these reviews.

Steps For How to Conduct a Performance Appraisal

The primary goal of a performance review is to improve performance (not just assess it). Giving performance reviews is a high-leverage activity because it affects the recipient’s performance for a long time—she often recalls the feedback. Performance reviews should be used in all organizations regardless of size because performance matters to every organization. Here are the steps for how to conduct a performance appraisal.

Managers don’t naturally write good reviews for three reasons:

  1. Delivering and receiving feedback can be unfamiliar and emotionally awkward. Most of us don’t have much practice at performance review-like work because American society discourages conflict (which negative reviews can generate). Recall good reviews you’ve been given for guidance.
  2. Assessing performance, especially of knowledge workers and managers (whose output depends on others’ output), is challenging.
  3. Performance is tied to compensation and rewards, two complicated and touchy subjects.

First, we’ll look at a four-step process for how to handle the first two difficulties and write good performance reviews. Then, we’ll look at how to handle the third difficulty.

Step #1: Determine Expectations

Before you can assess performance, you need to determine your expectations so that the review can focus on whether or not your subordinates met them. (Failing to do this is the major problem with most reviews.) 

As you come up with your expectations, remember that output is an important marker of performance.

Step #2: Assess Performance

Once you’ve established your expectations, this is the next step for how to conduct a performance appraisal:

1. Don’t ask the review’s recipient to write a self-review for you to reference because:

  • If you give her the same feedback she provided you with, she’ll feel cheated.
  • She’ll feel like you weren’t paying enough attention to her—if you had been paying attention, you’d have enough content for the review on your own.
  • Her review might sway you.

2. Gather data on the recipient’s performance by collecting meeting notes, progress reports, and so on.

3. On a blank sheet of paper, write down every thought you have about the recipient’s performance. Don’t edit them or order them by importance; just write down your stream of consciousness.

4. Once you’ve finished, look for broad themes. Probably, you’ll see evidence that the person does the same actions in various contexts. 

  • (Shortform example: If one of your subordinates always hands her reports in late, there’s a good chance that she also misses other deadlines.)

Don’t focus on potential or appearances because it doesn’t matter how professional someone acts or how good she could be—for example, if the recipient is a manager and her team doesn’t perform, her performance is flawed.

5. Call these themes “messages” and make a list of them. Then, support the messages with examples from your worksheet. (Ideally, none of your messages are surprising because you monitor the recipient and provide guidance regularly. If you do discover something you weren’t expecting that might appear to the person as coming out of left field, include it anyway: They need to know about it to improve their performance.) 

6. If the list of messages is too long for the recipient to remember, cut the less critical ones. You can probably mention them in a future review.

Step #3: Provide Feedback

As discussed, the goal of the performance review is to improve performance. Therefore, after assessing performance, you need to provide task-relevant feedback—feedback that is directly related to work—to guide recipients toward improvements.

Step #4: Deliver the Review

Once you’ve decided which type of feedback to provide, it’s time to deliver the review. You should give a recipient a written review in advance of your in-person discussion because:

Reason #1: It will give her time and privacy in which to process the information. She’ll be more prepared to discuss her review when the time comes.

Reason #2: If you give her the written review after the discussion, she might find something that surprises her because she wasn’t listening carefully in the meeting and get upset about it.

Reason #3: If you give the written review during the meeting, she may pay more attention to it than what you’re saying. Additionally, she won’t have time to prepare what she wants to say in response.

Now that you know the steps for how to conduct a performance appraisal, you can develop your own system.

How to Conduct a Performance Appraisal: 4 Steps

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  • The 11 activities that offer a higher impact on output
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Carrie Cabral

Carrie has been reading and writing for as long as she can remember, and has always been open to reading anything put in front of her. She wrote her first short story at the age of six, about a lost dog who meets animal friends on his journey home. Surprisingly, it was never picked up by any major publishers, but did spark her passion for books. Carrie worked in book publishing for several years before getting an MFA in Creative Writing. She especially loves literary fiction, historical fiction, and social, cultural, and historical nonfiction that gets into the weeds of daily life.

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