16 Best Practices for Using Performance Reviews to Drive Employee Development

Employee performance reviews should be positive and drive employee development, not cause fear and anxiety. If your organization is still using traditional performance reviews, which call out all the employees’ weaknesses, it’s time for a change! A future-focused coaching model will not only drive employee development but also engage and motivate your workforce. Effective performance reviews are an important guiding light on their career journey—and must include an employee development plan, meaning ongoing training and mentorship.

Why Evolve Beyond Traditional Performance Reviews?

Employee performance reviews have long been associated with fear, panic, surprise, and anger. A study by HR services company TriNet found this was especially true for millennials (those born after 1980). The researchers found that nearly a quarter of millennials (22%) have called in sick because they were anxious about performance reviews, and two-thirds (62%) felt blindsided by their review.

A critical problem with traditional performance reviews is that they can be backward-looking rather than forward-thinking and not focused on employee development. Companies have known for a while that traditional performance reviews are broken, but they won’t be replaced until there is something to replace them with.

The goal of all annual performance reviews should be, of course, to acknowledge accomplishments, realign performance if off track, AND encourage and support continuous employee development. Companies need a set of best practices to drive employee development and make performance reviews a positive and mutually beneficial experience—and they need to train their managers on conducting effective performance reviews.

16 Best Practices for Managers: Performance Reviews that Drive Employee Development

Employers should leverage the performance review as a valuable tool to mentor and coach employees to further their professional development and foster job satisfaction. It starts with transforming your review process. These 16 best practices can help guide this shift.

1. Take performance review training. For anyone who has a direct report to coach effectively and offer future-focused feedback to, they must have access to an effective training program. The ultimate goal of any performance appraisal is to increase employee engagement and develop workforce talent. Accomplishing this means putting an effective program in place to train managers and supervisors.

2. Assign a self-performance evaluation. Self-assessments play a critical role in ongoing employee development and training. It’s an opportunity for direct reports to be reminded of their successes and challenges from their perspective. The self-evaluation should consider job description review, reflection on accomplishments and struggles, and desired career path and training needed to accomplish goals. Asking your employees for self-evaluations conveys that managers trust their employees to be self-aware and in control of their duties, commitments, successes, and career development. A study from Harvard Business School found that reflection can build employees’ confidence in their ability to achieve a goal and influence their overall performance. It can also create increased job satisfaction as they feel more in charge of their career growth, knowing they are contributing to the organization, and feeling heard by their managers.

Self-performance evaluations are also beneficial to the manager or supervisor. Having the evaluation will help with writing their review. You’ll be able to consider the information shared and see their perspective. The self-review will also provide insight on what new training and projects the direct reports are most suited for.

3. Use a performance review template from HR to accomplish the same goal of driving employee development through training and mentorship. All managers and supervisors must use the same template. Here are several examples to thoroughly complete a review template with ease.

• Read through past performance reviews to note progress made towards past goals.
• Identify company metrics that relate to the employee's work.
• Gather the notes from regular check-ins to summarize and reference specific examples.
• Refer to the job description and note what’s changed and needs to be reflected in the review.
• Note what immediate and future training will be needed to accomplish the employee’s career goals and fill any skill gaps.

4. Deliver inclusive feedback. Acknowledge unconscious bias and mitigate it. Sounds easier said than done! That’s when management training comes into play.

To effectively deliver inclusive feedback to employees of all backgrounds requires soft skills, such as a growth mindset, empathy, and active listening, along with inclusion and belonging skills that help employees grow an appreciation for all lived experiences, become active allies, and remove unconscious bias.

5. Be prepared for the performance review meeting. This step is crucial to building a foundation for effective employee development.

• Be ready to provide meaningful feedback that sets explicit expectations, recommends concrete actions, measures employees’ achievement against these benchmarks, and sets the groundwork for enhancing performance and growing productivity in the future.
• This is also the time to look for opportunities for professional development and additional training. Don’t spend time focusing on weaknesses that need to be improved, but rather on how the strengths can be leveraged to further professional development and growth. Adding a new responsibility or setting a new goal can lay the foundation for a promotion.

6. Emphasize open communication. An effective review involves two-way conversations, not one-sided monologues. The manager should drive the conversation, but the direct reports should not just listen. This includes practicing active listening. Let direct reports share their successes and challenges, ask specific questions, and make requests to help make the conversations productive. Be sure to discuss what training will lead them in the direction of their career path.

7. Simplify the conversation. Don’t focus on the past, but instead on future growth.

8. Give positive feedback. Positive feedback automatically encourages positive performance. Positive reinforcement is a powerful way to encourage proper behavior. Psychologists discovered this decades ago through animal learning studies. While punishment can suppress unwanted behaviors, it doesn’t teach what positive actions should replace them.

To ensure that employees are living up to their job description, expectations, and company culture, leaders should praise employees when they succeed. This will encourage them to continue on the same path.

9. Focus on inspiring, motivating, and engaging. The right kind of feedback can inspire, motivate, and engage your employees. This “feel good” aspect of feedback pays dividends throughout the workweek and beyond. Soft skills and feedback training play a key role in driving this best practice forward.

10. Properly deliver constructive feedback. If handled appropriately, guidance signals to employees that you are concerned about their performance and want to see them succeed. This can be inspiring, too, if properly voiced. Having difficult performance conversations takes planning, empathy, and emotional intelligence. Once you’ve laid out the positive steps they can take to improve, employees can be motivated to take on the new challenge. Again, for this type of sensitive feedback to be successful, it takes soft skills and feedback training.

11. Stay “future-focused” with meaningful feedback. Although a review will need to look at past behavior, the primary focus should prioritize goal setting to lead them down their desired career path and discuss what is required such as training, a mentor, and additional tools, to meet those goals.

Performance review time is a prime time to engage and support employees on their growth journey by setting clear expectations for employee development. Share development plans.

12. Foster a growth mindset. Stanford psychologist Carol Dweck introduced the concept of a growth mindset to describe the belief that skills and intelligence can be developed, rather than being fixed traits people either have or don’t. Employees should be reminded that performance reviews are meant to help them identify and develop the skills they need to accomplish their goals—and not to pass judgment on the skills they might lack—and foster personal growth.

13. Disconnect performance conversations from compensation conversations. Talking about compensation during a review can make people defensive and less open to constructive feedback.

14. Schedule regular check-ins. Formal meetings provide another opportunity to provide timely and regular feedback throughout the year and avoid any surprises at review time. Regular check-ins allow you to understand how the goals set in the last review are being met. And you can immediately offer your direct reports guidance and training in skill gaps on the spot as you see them.

Be sure to take notes at your regular meetings with your team members to reference them when writing performance reviews.

15. Give informal feedback. This can easily be provided during day-to-day tasks. For example, an employee sends a quick update via an internal communication channel. Simply replying, "Thanks! Great job!" is an informal way to recognize the team member’s work. Sharing timely feedback like this keeps the guesswork out of employees knowing how well they’re doing.

16. Timely ongoing feedback. Surveys indicate that, contrary to what managers may think, employees crave regular feedback. According to statistics from Zippia.com, 60% of employees report wanting feedback on a daily or weekly basis, and for workers under 30, that number increases to 72%. 

This is especially encouraged for remote and hybrid workers. Continuous feedback allows for better transparency, morale, and the ability to resolve performance issues quickly. It also makes managers understand their employees more as people, and that rapport can be crucial for both.

“The biggest advantage {timely ongoing feedback} is you build trust, and you start building real team bonding,” —Susan Stehlik, professor of management communication at New York University Stern

What to Say (or Write) in a Performance Review: First Steps for Managers

Suppose you’ve ditched the traditional performance reviews in favor of an ongoing coaching model that incorporates these 16 best practices. Will that guarantee that everything runs smoothly from here on out?

Not exactly. Mentoring and coaching, like anything else, are skills that need to be developed. Managers might flounder just as much about knowing how to encourage their direct reports’ strengths and foster employee development as they would about knowing what to write in the annual reviews.

For instance, HR leaders might need to provide managers with sample goals, review questions, and specific examples of positive and meaningful feedback. Such examples work best paired with manager training and an overall feedback culture.

Examples of goals for employee performance reviews

• Performance goals (How can they accomplish more and produce better output?)
• Education goals (What should they learn, and when?)
• Leadership goals (How can they take on more responsibility and learn to lead others?)
• Accountability and time management goals (How can they be more dependable?)
• “Stretch” goals (How can you stretch the talents they already have and demonstrate even greater ability?)

Examples of questions to start review conversations

• Which job responsibilities/tasks do you enjoy most?
  Which do you least enjoy? Which would you change?
• What accomplishments are you most proud of this month (quarter/year)? How did those help the company overall in its mission?
• Which projects/deliverables were you least proud of? Why? Considering that, what are you doing differently now (or would you do differently in the future)?
• What do you do well in your position? And what do you still need to work on?
• What motivates you to do your best work? On the flip side, what kills your motivation?
• What do you see as the next step in your career path? How can I help you with your career development?
• What do I do that is helpful as a manager? What could be done better? Is there anything I do that you feel is getting in your way or preventing you from reaching your potential?

Employee Performance Reviews: Feedback Examples

• Describe a project or team effort in which the employee made a meaningful contribution. How did this help ensure success?
• Describe an instance where the employee demonstrated one of your company's values. What was the value, and why is it important?
• What are some other tasks, projects, or teams that could benefit from this employee's skill set?
• What goals were set at the last review? What was done to make progress toward those goals?
• Set out some challenges. What are some areas that the employee should focus on next? Don’t forget to describe why these are important for the organization!

Make the Transition

Again, the idea of abandoning traditional performance reviews and replacing them with future-focused feedback and coaching is not new. It is a time-tested way to increase employee engagement and develop workforce talent. But doing so means putting an effective program in place to train managers to coach effectively.

HSI Can Help

Ready to launch an effective management training program and training on how to build an effective feedback culture, empower employee development, and boost employee performance? Our customers utilize a series of training courses that help both employees and managers make the most out of their performance reviews.

Experience HSI’s unique approach to learning with both video and article-based lessons that can be delivered ad hoc or curated to fit your company’s needs.

Check out a sampling of free lessons and schedule a consultation today.

Additional Resources

• Actively Listening? [Say Whaaaaat?]
• On-Demand Webinar: The 2025 L&D Playbook: How to Make Change Happen
• White Paper: The Power of Microlearning: A Proven Learning Strategy for Workplaces