The small company I am working for never had performance reviews. Because the employees were either part-time or co-founders, there was never a need for them (each person had a stake in the company, and any things that needed to be worked on were discussed relatively openly in company-wide meetings).
Due to the success of the business, we have started hiring new full-time employees who have been asking for us to have formal performance reviews. We asked them what they were looking for from those reviews (since we have never really done them), and they wanted:
- To understand how their performance meets our expectations
- To give an opportunity to review career goals and future prospects in the company
- To give them a chance to give us feedback on our management
Since we plan to continue to grow in the future, we do feel we need to establish some sort of formal process. Understanding that this will be a work in progress, we want to give it a shot. What are the essential ingredients to a successful performance review?