Driving Operational Excellence Through a Solid Performance Evaluation Process

The new year is officially upon us. This means that it’s time for companies to reflect on the goals that were set early on in the year and determine whether these goals have helped drive operational excellence by engaging and encouraging the efforts of individual employees.

When we think about performance-driven companies, these are a few things that come to mind:

• Setting & stretching the bar high for performance
• Aligning the culture with overall company objectives
• Connecting individual measures with organizational goals
• Differentiating levels of performance and results
• Engaging in high-quality conversations

Performance-driven companies apply these principles to their organizations so that employees think differently about that next promotion or salary increase. They want to build individual skills and abilities to make themselves more valuable to the organization. The bar is set high and stretch goals are established, and most importantly, their performance is regularly evaluated and communicated with them.

In companies that are not performance-driven, employees tend to think they simply deserve that next promotion because they have been at the company the longest. They also have the mindset that they will receive an increase regardless of their performance because the cost of living has increased or that they deserve to receive one for coming to work every day.

Ongoing communication is essential to achieve operational excellence. All areas of the performance evaluation process are impacted by good communication skills, from goal-setting to coaching and providing regular feedback. Giving and receiving balanced feedback is paramount to the success of each employee, but it must be specific, consistent and authentic.

Oftentimes, the value of asking a simple question is a great conversation starter. You might ask questions like: How do you think you did with your goals this year? What went well? What could we as a company have done better? What should we change? What evaluation score would you give yourself?

An impactful performance evaluation process is all about the conversation and not the structure or form. Thoughtful planning comes into play where organizational, departmental and individual goals are aligned to ensure effective performance measures are in place and communicated well ahead of any evaluation. S.M.A.R.T. goals can lead to an individual employee’s performance success. When performance is tied to Specific, Measurable, Attainable, Realistic and Time-Sensitive goals, employees have a clearer understanding of what is expected of them, and how they can achieve it.

Each established objective provides an opportunity for both manager and team member comments. While the team member’s focus is on successes, challenges and lessons learned, the manager’s focus is on specific observations, feedback from others and quantitative results.

An impactful performance evaluation system always focuses on the outcomes. An employee’s individual effort may be commendable. However, if the targeted goals never arrive at the stated results, then the company will struggle to achieve operational excellence.
The ability to self-assess well and recognize one’s own shortfall is another factor of a meaningful performance evaluation process, and regular self-reflection should be encouraged by managers.

As we start the year, companies should begin to review the goals set last year and determine how effective these goals were to the organization. A strong performance evaluation process can really pave the way for a company to focus and drive operational excellence throughout the organization.

Tiffany Cardwell is a Principal Consultant on MCM’s HR Advisory Services team. She has more than twenty years of experience in domestic and international human resources within the banking, finance, food & beverage, healthcare, health insurance and long‐term care industries. She has expertise in acquisitions, change management, engagement, leadership coaching and development, performance management, compensation and total rewards, talent acquisition and workforce planning.

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