Why Should I Bother With Employee Evaluations

It can be an uphill battle, but it’s worth it.

Employee performance has been strongly linked to Employee Engagement [EE], and EE has been linked to Leadership, Focus, and Feedback.

Just try to find a business owner or executive today who isn’t focused on employee engagement as a priority.  All this effort, even though most studies show that the average level of employee engagement in recent years is essentially unchanged.  Alternately, there are reams of data that point to the exceptional performance and earnings of organizations who achieve significant employee engagement  gains. This strongly suggests that engaged employees are a competitive advantage, and their impact on the bottom line is real. This seemingly contradictory information can appear confusing, but one thing remains clear - Engaged employees produce results!

According to Gallup’s 2017 State of the American Workplace report, only one-third of all US employees are engaged at work.  Additionally, citing declines in productivity across all segments.

What’s being said is, only one in every three people in the average workplace actually cares about the work they do.  That means the other two are just there to collect a paycheck! So, if you’re the “one” reading this, then you’re probably wondering how to motivate the other “two”.  That’s if their EE level is really restricting output.

It’s not a problem if they’re not linked.  But, is the decline in productivity directly linked to the low engagement rates?

There are two key indicators in this report:

  1. Increased engagement = increased productivity.

  2. Low engagement = Low productivity.

 * This makes employee productivity measurement crucial in the modern workplace.

Unfortunately, in many cases, productivity measurement itself can be the cause of employee “disengagement”.  While traditional productivity metrics provide a means of measuring performance, they fail to motivate employees.

Gallup’s research found that three major factors lead to a lack of employee motivation:

  • Unclear and misaligned expectations

  • Ineffective and infrequent feedback

  • Unfair evaluation practices and misplaced accountability

These reasons point back to ineffective and demotivating measurement practices.  So, effective performance measurement systems must be designed to motivate employees to become more engaged, and therefore more productive.  To achieve this, companies must stop and how to align goals with performance measurement, and then develop a new approach that; measures performance, motivates employees, identifies problems, provides channels for feedback, and inspires performance.

Additionally, as most of the Leaders in organizations are also employees, the organization must establish and manifest goals that align the entire business and are also meaningful to the respective departments and their associates.  This keeps the Leadership engaged and better supports a feeling of contribution, through departmental goal attainment, toward the “ultimate goal”.

By rethinking the goals of employee productivity measurement, companies can move away from approaches that are designed to measure, judge, and incentivize performance. In doing so, they can move to a more sophisticated model that works to highlight operational inefficiencies, identify individuals who are not motivated, and encourage collaboration on solutions.

One benefit of abandoning traditional employee productivity metrics is that the solution to the problem isn’t complicated; it’s Leadership, Focus, and Feedback.


So, what’s a Leader to do?  Well... Lead!

Almost all successful Leaders of organized groups or teams (business, sports, military, etc), understand the strengths and benefits of the engaged.  One team, unified toward success in a common goal or mission. But, how does a Leader get this type of engagement?

The traditional way to measure employee productivity is to divide output by input. It was designed when manufacturing was the most prominent industry in the US.

The problem with traditional productivity metrics is that they don’t explain why productivity is higher or lower than expected. They can identify the problem, but they can’t provide a solution. They can’t improve employee productivity.

Discovering the issues that affect productivity is the ultimate goal of productivity measurement, and that’s a problem math alone can’t solve.  It requires visionary Leadership, and this doesn’t mean imply the shepherd leading the sheep. The dynamics of a Leader are so much more today than the whip or carrot of the past.  One thing that social media had created in our society, is that everything can be shared (even sometimes when it shouldn’t be).

Subsequently, a Leader must have a keen focus on the expectation and direction of the Company, and be able to project that as the focused, vision to the workforce.  Then, through the prism of this focus, help determine the appropriate feedback to guide and measure toward mutual success.


Measurement systems should be designed through a collaborative effort between individual contributors and their managers.  Allowing the people input who understand the business and know what complicates, expedites, or delays work can prove extremely beneficial.  These key performance indicators must then be placed within the framework of the company vision.

A Measurement System should address the following rules of engagement:

  1. What is the task?

  2. How should it be completed?

  3. Why should I be expected to contribute?

  4. Where am I prevented from doing the task, and should it be eliminated?

  5. When should I know if the task has been completed successfully?

Feedback, in each area, is essential to the Company, the Leader, and the Engaged Employee.

When leadership and employees, at all levels of the organization, work together to establish the goals, expectations, and challenges of their jobs... productivity and engagement rates soar.

The first step in developing a motivating system of productivity measurement is to align on goals and expectations. Then, teams can work together to establish measurement systems that accurately reflect true performance.

Start by working with your team to define tasks and goals. Then consider different ways to measure employee productivity that cater to the specific requirements of each individual task and goal.

Some examples of quantitative measures of employee productivity:

  • Measuring with employee productivity-tracking software

  • Measuring by deliverable

  • Measuring by objectives

  • Measuring by revenue generated

Not all positions are suited to quantitative measures. Sometimes you need to get a view of employee productivity that isn’t just based on numbers, and that’s where qualitative measures come in.

Some examples of qualitative measures of employee productivity:

  • The 360-degree feedback method

  • Measuring by quality of work

Remember, there is no one-size-fits-all solution to measuring employee productivity.  The fault with most approaches to employee productivity measurement is that company leadership dictates a single method that every department must use.  This approach generally fails because it doesn’t take into account the specific tasks a department does. As a result, it’s inadequate measuring actual results in performance declines.

A Team approach of Management and downline users of the system, cooperatively determining goals and objectives and how progress will be measured, within the Goal/Focus framework for the Companies success, will foster the greatest EE.

Ultimately, a traditional productivity measurement practice may oppose the goal of the process. Rather than improving productivity, it might inhibit or prevent it.


Modern productivity measurement must be more personal, more collaborative, and more obvious.  The company should allow guidelines for Leadership and team members, at all levels of the organization, to set their goals and measurements together. This supports engagement, and encourages productive discussion, to bring up issues that need to be resolved, it also creates a shared understanding of the expectations.

All of which leads to the true goal of performance measurement; improving productivity through communication [feedback].

What exactly is feedback?

Feedback occurs when an environment reacts to an action or behavior, or by definition;

Feed·back ˈfēdˌbak/  noun

  1. information about reactions to a product, a person's performance of a task, etc., used as a basis for improvement.

  2. the modification or control of a process or system by its results or effects, e.g., in a biochemical pathway or behavioral response

Would you dispute that feedback is important to continued success?

The Main Reasons Why Feedback is Important:

  1. It’s for motivation; Employees like to feel valued and appreciate being asked to provide feedback that can help develop the business decisions. Additionally, feedback from the client, suppliers, and other stakeholders can be used to motivate and to build better working relationships.

  2. It’s for listening; Regardless of the method used to gather feedback, the person providing the feedback needs to know they have been understood and that their feedback provides some value.

  3. It’s for continued learning; Continued feedback is important across the entire organization in order to remain aligned to goals, create strategies, develop products and services improvements, improve relationships, and much more. Continued learning is the key to improving.

  4. It’s always available; If you ask someone in your organization when feedback occurs, they will typically mention an employee survey, performance appraisal, or training evaluation. In actuality, feedback is around us all the time. Every time we speak to a person, employee, customer, vendor, etc., we communicate feedback.

Top performing companies are top performing because they consistently provide ways to make continual improvements.  They are not only good at accepting feedback, they deliberately ask for feedback. Effective feedback, both positive and negative, is valuable information that can be used to make important decisions.  Unfortunately, feedback is often mistaken for criticism. Generally, what is viewed as negative criticism is actually constructive criticism, but that is ultimately determined by the Leaderships vision of the role of feedback within the Company Strategy.

Where does your System fit in?

Does your company have a solid method for productivity measurement and Employee Engagement?   We’ve been there, seen that...and we do not put ourselves in a position to judge. Rather, as a helpful partner, we respectfully help study, support, and solve the root cause issues that will allow your business to get back onto the success track.

Our network has a Subject Matter Expert [SME] for every business segment and each department, assure our Clients that they can be confident in any area of improvement or compliance.

If your company is in need of a SME for the areas discussed in this article, don’t hesitate to contact our team at Smart Business Doctor.  We have support personnel for every segment of business, and we specialize in the diagnosing, prescribing, and rehabilitation of challenged SMB’s.  We can also assist in the financing, with favorable rates and terms.

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