Authored by: Carl J. Peterson, general counsel of Mid-Atlantic Business Unit at Titan America LLC.

We previously explored the best methods for goal-setting within your department — specifically, how best to identify those items against which performance would be measured during a given evaluation period. This month, we’ll focus on exactly how you should judge performance for your team, how often these evaluations should take place (annually, semi-annually, or quarterly), what should the evaluation entail (a simple determination of whether the goals were successfully accomplished), and how the evaluation should be constructed. Further, once you have that information, what should be done with it?


In many organizations, the annual review process is a singular event, typically centered around the end of a fiscal or calendar year, during which the previous year’s performance objectives are trotted out and discussed. It is usually occasioned by a far-reaching email from human resources declaring it to be “evaluation season,” which is followed by a symphony of groans varying in pitch as news travels down the halls. Then, like the stages of grief, managers move through procrastination, avoidance, and ultimately, begrudging submission.

These managers and organizations have missed the point. Driving performance and employee engagement is not and should not be a once-per-year-event. It is a daily, project driven event, and an opportunity to understand expectations from both sides of the desk.

Performance reviews have both an informal and formal nature to them. Informally, managers levy criticism of a task poorly performed or recognition for a job well-done. Formally, performance reviews consist of conclusions of the tasks performed, reduced to the functional equivalent of grade school measurements of competency school grades. Managers should be considering everything when grading performance and perhaps how those tasks relate to goals of the department and individual. Even in light of this charge, however, it’s important to recognize that our memories are short and we may have difficulty properly weighing activities from the beginning of the year to the week of the performance review.

I’d argue that this process should be at least every six months, if not quarterly.

Therefore, I’d argue that this process should be at least every six months, if not quarterly. Just think, you can experience the fun I’ve just described multiple times a year! I jest, but consider for a moment what makes the evaluation process so desolately “un-fun.” Dragging out last year’s goals, laughing at how hilariously short-sighted/misguided/misinformed they were, and then coming up with justifications for why progress was stunted in the first quarter of the year. I equate this process to billable hours. Hateful if you wait until the 29th to start documenting your time for the past 28 days. Amplified to span an entire year, it can become an unbearably miserable task — one that has arguably lost your attention and commitment before it even begins.

Now consider that in light of the fact that any number of icebergs can sneak up on your best-laid plans and sink goals before measurable progress can be made. Other factors can impact your department objectives as well — M&A activity may spike, litigation may be filed, management may push objectives from the top, or the loss (or addition) of team members can impact allocation of work. Wouldn’t it be nice to have the opportunity to adjust goals on the fly? To reset expectations? Rather than a once a year drafting session, writing goals and objectives in pencil rather than ink can offer some much-needed flexibility to you and your team to be sure that the written objectives are truly reflective of the expectations of the department.


This is where it starts to get tricky.

Because you heeded my well-reasoned advice in my previous column, the objectives identified for your team will be very easily identifiable and you should be able to quickly tick them off as either “accomplished” or “incomplete.” If achievement or progress isn’t quite so clear, a dialogue with the team member in question is necessary. Talk with them about what they would have deemed successful and why the accomplishments added up to that (or why they didn’t). Take the goals themselves to other members of the team and other stakeholders within your organization to see what others think of that individual’s contributions and the status of the overall objectives.

All individuals within your department should be evaluated through the same lens — meaning that to the extent possible, the rubric against which performance is graded should be identical. Consider how every department member has performed against a list of measurements: contribution towards department goals, achievement of individual responsibilities, personal improvement initiatives, willingness to stretch comfort zones, observation of company policies, etc.

Be clear with your team members what you believe their strengths to be. Be sure that you’re actively appreciating those things that they do well. If you’re identifying opportunities for improvement, be as specific as possible when discussing them. Broad statements without support — whether positive or negative — tend to fall on deaf ears and leave your direct reports feeling like the day-to-day doesn’t impact their overall review.

There’s a fine line to walk here — you want to be specific, but not so specific as to be perceived as nitpicking. Employees want to do a good job — make the path to the goal clear. “Yes, as receptionist we expect you to pick up the phone during your hours of work and document visitors to the building. No, you should not delay doing either of those tasks because you are texting your mother or memorizing the ‘phrase that pays’ to win those Jimmy Buffet tickets from the local radio station.”

You want to be specific, but not so specific as to be perceived as nitpicking.

Furthermore, once you’ve evaluated each member of your team, you want to consider how those evaluations stand next to each other. The team should not be evaluated in a vacuum, particularly where bonuses or increases correlate to that evaluation. If Lawyer A’s performance in the past year was markedly better than Lawyer B’s, their ratings should reflect that. If Lawyer C was able to finally rid the company of that nagging environmental issue, the gravity of that success should be considered.

The evaluation you’ve carefully crafted should be written and should be given to the employee in the review session. Regardless of how dedicated a note-taker your team member may be, they’ll not be able to capture all of what you’re saying. Furthermore, you’re likely not going to have enough time to cover the waterfront on each and every nuance of the past 12 months. By committing the evaluation to a written format, your employee has an opportunity to reflect back on them throughout the year if they choose to do so.

Even though you’ve handed them a written version of the evaluation, a discussion should follow. Talk through the successes and the difficulties of the past year (or six months, or quarter, depending on frequency of these discussions). Use this as an opportunity to not only talk about the employee’s performance, but also for your team to provide feedback to you — to let you know what else you might do to help foster their development and performance.

So now what?

If it started to get tricky before, this is where it gets downright difficult. In many companies, the evaluation process is the foundation upon which the sausage-making of annual merit bonuses and salary increases. Salary adjustment should be but just one part of performance review and employee engagement. If this is not the case in your organization, I offer a word of caution:

The very notion of a merit-based increase is intended to reward those whose performance dictates it, and to curtail the increases of those whose does not. In theory, this carrot at the end of the stick works perfectly. In practice, however, it fails more often than not. If the company is having a down year, and merit adjustments are limited, look for other ways to reward your team. Is there a new task an employee might want to perform? How about training opportunities for the individual or field opportunities to make stronger teams? How about a title change or promotion? Never underestimate the value of a bit of public recognition at the next town hall meeting.

I previously mentioned how team members shouldn’t necessarily be viewed in a vacuum. As the team leader, you should undertake efforts to be sure that you’re measuring similar performers through the same lens. Note, however, that the results of this direct comparison can set the stage for difficult discussions. Many managers eschew the awkward exchanges that should follow a period of mediocre performance and delivery of limited (if any) salary increases or bonus payments.

As a result, and in an effort to mitigate the potential for these chats, the evaluation itself (as well as the financial fallout of that evaluation) may be softened, leading to a world where even those employees whose performances needs improvement find themselves enjoying a larger pieces of the pie than they might deserve. Your “top-end” performers are left with a smaller pool from which to draw their own increases and bonuses. Thus, the “reward” for a year of hard work and goal-achievement is a slightly better bottom-line number for exemplary performance, and the penalty for not fully achieving is curtailed.

Never underestimate the value of a bit of public recognition at the next town hall meeting.

This concept isn’t only theoretical. Of the 150 large and mid-sized American companies surveyed in a 2016 study conducted by Willis Towers Watson, less than a third of the executives polled think that incentive pay plans are effective at differentiating pay based on individual performance. Further, only half believe that annual bonus have any impact on how well people do their jobs. Merit-based raises based on performance fare even worse in the aforementioned survey, with only 20 percent of the surveyed executives indicating that such raises drive higher levels of individual performance.

Consider also that the legal department is typically among the more highly compensated within the company. As a result, the members of your team may be testing the upward limits of the salary bands for their company pay grade, often higher than their similarly-graded counterparts in other disciplines within the company — particularly for your highest-level performers.

As a result, minimal increases that are allegedly based on performance can lead employees to feeling overworked and underappreciated. This is particularly true where managers may sing the praises of a team member during the performance review, but the numbers that follow don’t back up the sterling evaluation. Such circumstances create a high likelihood that when an opportunity elsewhere presents itself, the star players on your team may be more than willing to consider it.

The same can be said for the opposite side of that coin. With the downside for failing to perform being somewhat limited, the accountability factor is significantly lower than it probably should be. The same Willis Towers Watson study has more than 25 percent of respondents noting that performance bonuses were paid to employees that failed to meet expectations.

So what’s the alternative? Some companies, such as Lear, have removed the carrot altogether, divorcing the concept of raises and bonuses from the evaluation process completely. Instead, raises are given based on what the market dictates, and bonuses are stock awards reserved for extraordinary accomplishments. Promotions are used to recognized high-potential employees.

By removing the financial aspect of the evaluation process, the thinking is that a more comfortable and less pressurized environment of actual development exists. Is it perfect? Perhaps not. Is it something different, thinking outside of the box in an effort to bring the best out of your team and reduce political infighting related to merit increases? Sure. Is it best for your organization? Perhaps, perhaps not. But simply doing things the way they’ve always been done just because they’ve always been done that way does your company and your team a disservice. Ask the question of your HR department — find out if they’ve even asked the question of whether their practices are supporting their goals.

For further reading, download the ACC Guide to Process Improvement to serve your organization with greater excellence. Using a methodology to understand value from the client's perspective, data can help you measure processes, and apply structural improvements to address root causes of inefficiency, eliminate waste, and improve quality through consistency and effective controls.