Evaluating employee performance is key to the growth of your business. The performance of your employees hugely influences the success or failure of your company.

But it’s critical to get employee evaluation right. It can empower your employees to reach new heights or drive them away from your company.

Evaluations typically include a review of an employee’s performance and how it compares with the company’s expectations.

When done right, it helps you hire, develop, and retain the best talent.

Essentially you need to offer feedback in a constructive way that helps ensure they remain motivated and continue to develop valuable skills.

In this article, we show you the best ways to measure an employee’s performance and give you some additional tips on evaluating an employee’s performance.

Ready? Let’s get started.

9 Ways to Evaluate an Employee’s Performance: How is Performance Measured?

Here are the most important metrics you need to take into consideration when evaluating employee performance:

Level of Execution

There’s really nothing more important than execution. At some point, an employee needs to stop planning or thinking and start doing. Real progress is made when you do things.

An employee with a “get shit done” mentality is a valuable one. Once an employee has prioritized the task at hand, does she execute like “crazy” until the task is completed?

Or does she overthink everything and take a shit load of time and money? If it’s the latter, then she needs some serious help from you.

Quality of Work

It’s true what people say “quality is more important than quantity”. Employees who really care about what they do produce quality work.

People who believe in doing quality work are the biggest assets of a company. These employees go the extra mile to make things better.

They show close attention to detail because they understand that what separates good from great is attention to detail.

Those subtle, little details a person cares about say a lot about them.

But, the employees who want to do something in the best way possible are quite rare. A lot of people just do something, but in order for it to work or be effective, one needs to focus on the quality or be aware of what’s good and what isn’t, or how effective it is.

Are they okay with the kind of work they do? Or do they think they need to improve themselves to get the kind of results you want?

Level of Creativity

People who are passionate about what they do produce creative work. They don’t fear failure or what other people think.

And they are often ready to fail and make mistakes and look dumb in the eyes of other people because they know that that’s the only way to grow and get better.

They truly understand that in order to do something original and new, something that’s never been done before, they’ll have to tolerate critics and accept things the way they are.

Who’s willing to try new or different things? Who’s so good at what they do that they don’t bother breaking the rules while also producing great work?

Amount of Consistent Improvement

Do they have the desire to get better? Are they putting in enough effort to improve themselves?

How fast have they improved or have they improved at all?

How good are they now compared to the time when they had started working at your company?

An employee might not have been good initially during the first few months with you but then could have improved a lot over the course of a year.

Customer and Peer Feedback

What do people have to say about an employee? Feedback, either from customers or peers, says you a lot about an employee’s potential to improve.

An employee with good customer or peer feedback can help bring about positive growth and get better at what they do.

But the ones that have failed to gain good feedback from either will most likely go down in performance over time. The ones that received negative feedback are likely to continue underperforming.

Sales Revenue Generated

One of the most important elements of growing a company is having access to a steady stream of leads.

How much revenue does an employee bring in on a monthly basis? This is probably the most important metric when it comes to judging an employee’s performance.

How many leads were generated and added to your sales pipeline? How many of those leads were they able to close? Who helped streamline the lead generation process at your company?

Responsiveness to Feedback

How well do your employees respond to constructive feedback? Does an employee understand that taking feedback from his peers is required to get to the next level?

Do they realize that feedback only makes things better? Or do they take it personally?

Constructive feedback can be invaluable in that it helps employees understand their performance and commit to developing their skills further.

Ability to Take Ownership

Do your employees realize that they’re accountable for a certain project within their job description?

Are they proactive in their job role and understand the purpose of their job duties?

Your employees should be able to take full ownership of the tasks that have been assigned to them.

People who take ownership learn on the go and figure things out themselves. This helps you overcome challenges and remove roadblocks.

Ideally, you also want employees who want to take on more responsibilities.

Percentage of Tasks Completed On Time

We’re talking about the amount of work an employee was able to complete over a given period of time. Being able to complete tasks on time is an underrated quality.

The rate of completion is one of the key metrics to track when evaluating an employee’s performance.

You need to have employees who are good at hitting targets on time. It’s good to have employees who never missed a deadline while also managing to get the work done at a high level.

Employees who complete tasks on time maintain a task list so they can monitor their tasks and measure their progress.

6 Effective Tips on Evaluating Employee Performance

Here are some things to keep in mind when evaluating an employee:

Set Performance Standards

A performance standard outlines the company’s expectations on how the work should be done by an employee in a specific job role. It applies to every employee who holds the same position.

Set Specific Goals

Unlike performance standards, goals are specific to each individual employee. These goals are set based on the strengths and weaknesses of an individual employee.

Be Honest with Criticism

When you give critical feedback, be straightforward about it. Say it like it is and give them clear, specific advice on how they can improve their performance.

Have a Conversation

Make sure it isn’t a one-way conversation where only one person gets to talk and express their concerns. Rather, it needs to be a productive conversation that ultimately helps both of you.

Give Ongoing Feedback

Employee evaluation isn’t a one-time task but an ongoing process. You need to give feedback throughout the year and keep your employees on track.

Ask Specific Questions

To have a productive conversation and receive valuable feedback, here are some questions you can ask your employees to spark a meaningful conversation:

What support do you need from me to carry out your tasks and reach your goals?
Do you need training or resources to develop any new skills?
What are your career goals and how can I help you achieve them?

Final Thoughts

The metrics used to evaluate employee performance will depend on the job role or the type of business an employee works for. Use the above metrics to help your employees identify potential growth opportunities and areas of improvement.

Looking for the right software for managing and evaluating employee performance? Here’s an article from us on the best performance management tools.

Here’s another article that shows you how to perform an effective performance review.

And another one that gives you tips on how to improve employee performance.

Got any questions on evaluating employee performance? Any interesting tips or techniques you use to evaluate your employees’ performance? Let us know about them in the comment section below. Looking to create surveys your employees will love answering? Feel free to check out SurveySparrow.

Evaluating Employee Performance: A Quick Guide