1. Coach all the time. Coaching is an ongoing process. You should be coaching employees all the time—even when their performance is good.
2. Don’t micro-manage. You don’t have to jump in at the first sign of every or any problem. Give employees time to try and find a solution, but be ready to jump in when they get stuck. 
3. Get employee input on the methods you recommend. Always give them specific and immediate feedback on performance.
4. Get a more experienced employees to teach or mentor your less experienced employees.
5. When problems occur, ask employees to analyze their own performance and results before you offer suggestions. Ask them what they like best and least.
6. Don’t ignore problems. They won’t go away or improve by themselves. Often, they will get worse.
7. In every coaching session, find something positive to say.
8. Coach all the people in your work group: top performers, those in the middle, and those at the bottom. Everybody can develop and grow.
9. Don’t assume employees understand your goals and expectations. Make sure you’re clear in your communication. Have employees repeat back to your their understanding of your expectation. Ensure your employees commit to your expectations.
10. Be realistic. Set objectives employees can meet by stretching their abilities. When you meet one objective, go on to another. Achieving each objective creates momentum.
11. Challenge your employees with an increasing number of tasks and decisions and give them time and space to grow. The more they do, the sooner they’ll be able to absorb some of your less challenging tasks, giving you more time to tackle those that best use your skills and your time.
12. Let people practice in a safe and non-threatening environment, and providing helpful feedback.
13. Mistakes happen. No one can improve without making mistakes. Mistakes are not failures. See them stepping stones toward success. Get your people involved in finding out what went wrong and to avoid the mistake in the future.
14. Don’t let unacceptable performance go unchecked. By not addressing it, you reward unacceptable performance.
15. Recognize good performance immediately to establish a clear link between performance and reward.
16. Encourage employees to measure their own productivity so that they take responsibility for their own performance.
17. Credibility is your most important asset as a supervisor and as a coach.
18. Good coaches do what they expect from others. They always model acceptable standards.
19. Never be afraid to make mistakes—all good leaders do. As you overcome your mistakes you’ll become a better supervisor, and a better coach too.
20. Accept the fact that you don’t know everything. Be open to learning from others, including those your are coaching.

What other tips would you offer to someone looking to improve their coaching skills?

Meeting Set Up

• Allow adequate time to complete the review
• Put the employee at ease and eliminate distractions. Don’t check your Blackberry during the meeting!
• Explain you are there to provide performance feedback and support their career growth.
• Outline the steps and time line for the appraisal process.

Employee Self-Assessment

• Ask the employee open-ended questions about their self-assessment.
• Listen actively and show interest in the employee’s comments.
• Be prepared to change your view point based on new facts presented by the employee.
• Ask the employee to suggest ways they can improve their performance.
• Ask how you can support them in achieving goals or competencies.

Your Feedback

• Discuss what you see as the employee’s strengths and achievements.
• Talk about the areas where you see them growing to achieve their goals or competencies.
• Raise any concerns in an honest, direct and constructive way.
• Emphasize the priority areas where improvement is most necessary.
• Describe how these improvements will contribute to the success of the employee and the organization.
• Stay focused on the specifics of performance appraisals process – do not discuss salary.
• End on a positive note. Restate achievements and thank them for their contribution to the organization.
• Providing realistic feedback to your employees is an important part of any performance management process. Be sure to manage their expectations.

Performance appraisal or assessment interviews allow you to do the following:

• Re-cap positive and negative events, interactions, attitudes and productivity during the past evaluation period;
• Assess individual and team strengths, limitations and obstacles;
• Identify opportunities for achievement, growth and promotion; and
• Create measurable and achievable goals for the next six to 12 months.

He suggests a couple of questions you must ask before you can start a performance management program with an employee:

1. Is the employee salvageable? In other words, does the employee want to change (or is the employee able to change)? If the employee cannot, or will not, change to meet the employer’s reasonable expectations, then is it worth embarking on something that you believe, even before you’ve started, is destined to fail? Is that fair to you, the supervisors, employee or the business?
2. Even if the employee is willing and able to change, is this employee one that you want to have in the business 10 years from now? If “no”, query whether you want to invest the time and effort on performance management in these circumstances.

Click link to read: Taking a Walk Down the Performance Management Trail

Results Show Rewards and Performance Management Seldom in Line With Business Strategy and Viewed as Less Than Effective in Meeting Business Needs

STAMFORD, CT, September 5, 2007 — Reward and performance management programs are not keeping pace with the demands facing businesses today, says a new Towers Perrin study. Despite enormous shifts in the business landscape over the last decade — driven by increased competition, cost pressures, globalization, aging populations, technology advances, and skill and labor shortages, to name just a few — most companies have made minimal changes, at best, in the design and delivery of their base pay, incentive and performance management programs. As a result, current programs do not appear to be meeting talent and people management needs effectively, especially in an environment increasingly focused on attracting and retaining people at all levels in an organization.

The Towers Perrin study, the fourth in a decade-long series of studies on rewards and performance management, surveyed more than 600 human resource and compensation managers at midsize and large organizations in 21 countries. The survey found a growing “say/do” gap around reward design and delivery. Although many of those surveyed said their reward strategies were designed to retain and attract talent (73% and 57%, respectively), few of the actual tactics they reported were consistent with this stated focus.

“Overwhelmingly, we found that companies are making very incremental changes in reward and performance management programs,” said Ravin Jesuthasan, Managing Principal and Practice Leader, Towers Perrin, “and they’re doing so year in and year out. What makes this of concern is that business changes have been anything but incremental. In fact, it’s fair to say the last decade has been among the most turbulent in recent business history, encompassing the dot-com boom and bust, post-9/11 cycles of recession and recovery, and dramatic technological and workforce shifts that are changing both the way companies do business and the way people do their work.”

“In this environment, we expected to see comparable innovations in rewards practices. Instead, we found most companies doing things like adding or eliminating measures in variable pay plans, broadening or cutting back on eligibility for incentives, and shortening or lengthening the pay communication cycle. Put simply, our data confirm what amounts to a pattern of ‘tweaking’ at the edges of programs, rather than creating the more systemic and integrated approach required to address the scope, intensity and magnitude of change on the business side.”

Some of the trends highlighted in the study include:

Minimal customization of rewards beyond the sales function — Although a majority (59%) of respondents do customize rewards, most (79%) do this chiefly for sales positions. Very few extend this approach to other functions or roles that are critical to executing their strategies (e.g., customer service staff for retail organizations or R&D talent for pharmaceutical companies), despite evidence suggesting customized rewards can make a difference in both retaining and motivating people.

Increased use of company-wide results in variable pay — More than three-quarters of the respondents have changed their variable pay programs in the past three years, and nearly half expect to implement more changes to variable pay and bonus programs in the near future. Yet the most common shift is an increased emphasis on using company-wide performance as a metric (cited by 42% of survey respondents) — a surprising focus given the relatively small number of employees who can materially influence corporate results.

Practicing performance management as a high-tech, not high-touch, activity — Fully 90% of respondents reported changes in this area in the last three years, and almost the same number expect to make more changes in the next three years. For the vast majority, however, the nature of the changes are technological, typically involving automating more aspects of the process to enable employee and manager self-service online. As Jesuthasan noted, “While technology can go a long way toward increasing the efficiency of performance management systems, and is a ‘needed to play’ attribute, it cannot take the place of the human interaction that truly powers performance management: the personal relationship between manager and employee. This focus on high tech over what we call high touch could explain why just 43% of the respondents said their performance management program was only somewhat or not at all effective. It’s certainly easier to implement technology than teach managers to have meaningful performance discussions, but an effective program requires both.”

Limited measurement of ROI on rewards spend — A disturbing 68% of the survey respondents said their organizations have no formal method for measuring the return on their considerable investment in rewards. Yet, without such data, HR and compensation executives can find it difficult to make a case for more strategic investments in rewards programs or to justify current expenditure.

Insufficient alignment of performance management and business needs — Fully 43% of the survey respondents said that their performance management systems did not effectively link to business needs. And 42% felt their systems did not effectively equip managers to identify, develop and reward high performers or deal with poor performers. As Jesuthasan noted, “These are critical strategic gaps that will ultimately derail the very purpose of performance management. Getting the strategy right is a key first step in effective performance management and one that few companies appear to be paying enough attention to right now.”

“On one hand,” Jesuthasan continued, “it’s encouraging to see that companies are emphasizing performance and talent retention. On the other hand, what they’re doing to reward and improve performance is not particularly effective, or in line with overall business performance and strategy. There’s a clear disconnect between the contributions senior management wants to elicit from the workforce and the specific tactics organizations are engaging in to realize this contribution.”

Breaking With Past Patterns

To break the cycle of incremental change, according to Jesuthasan, organizations need to engage in “discontinuous change,” and identify actions that will have a clear and sustained impact on the bottom line. Towers Perrin recommends four steps companies should consider when revamping reward programs:

1. Think big, bold change. Shake things up, but in a way that aligns with core business goals for performance, cost, talent management and employee engagement.
2. Identify required changes in terms of desired business outcomes, and prioritize and sequence those changes based on an analysis of the efficiency, effectiveness and impact or strategic relevance they will have in meeting specific business goals.
3. Place calculated and systematic bets on specific programs and segments of the workforce that align with business objectives and priorities. Avoid the “one size fits all” generic approach to rewards because it lacks focus and can marginalize the return on investment.
4. Develop a balanced set of metrics that encompass the key outcomes needed, and measure results against those metrics, adjusting course over time as required

About the Survey

The 2007 Towers Perrin Reward Challenges and Changes Survey presents data from 637 HR and compensation executives at midsize and large companies in 21 countries in North America, Latin America, Europe and Asia. Fifty-one percent of those surveyed come from organizations reporting more than $1 billion in revenues in 2005. The survey builds on similar research from 1995, 1999 and 2003, to compare changes in reward and performance management programs over time.

Towers Perrin Survey Shows Corporate Reward Programs Out of Date in a Rapidly Changing Market.

To facilitate conducting the formal performance appraisal, supervisors should keep notes and observations of their employee’s performance throughout the year. This will help provide the employee with a balanced and objective formal appraisal. The supervisor should also consult with clients and co-workers of the employee to obtain as much performance feedback as possible.

The formal performance appraisal is designed to communicate job responsibilities and performance expectations/objectives between supervisors and employees. The primary goal of the appraisal is to develop the commitment of both parties to achieve the best possible performance results.

Meeting this goal is achieved effectively when:

1. Individual employee performance is measured over the review period against mutually established job standards and performance expectations.
2. Employee growth and development is encouraged through accurate feedback from observations collected throughout the year
3. Employee achievements are recognized
4. Specific, constructive recommendations are offered when performance improvement or development is required
5. Employee input encouraged
6. Clear objectives are mutually established for the upcoming review period.

For further reading:

• 6 Ways to Measure Employee Productivity
• 8 Best Practices to Stop Employee De-motivation

Personally, I’m not convinced of the effectiveness of performance reviews as part of the wage and salary process, but I do think they are an effective part of the performance management toolkit. The review process can serve to encourage employees who are doing a good job, or it can help improve employees who are having difficulties.

Here are 6 steps that can maximize your review process:

1. Regularity – Performance management needs to be an ongoing process, day by day and week by week. Likewise, the annual review has got to be on a schedule; whether you follow an company-wide cycle or an employee anniversary date.
2. Preparation – When you, as the manager sit down to review your employees, have every bit of information you require. This is not a time to wing it. You should know which performance issues you are planning to discuss, what objectives you would like to set for the next period, etc.

   Preparation also means: scheduling in advance so the employee can prepare; allowing enough time for the review meeting, turning off the phone, Blackberry, e-mail, etc. and focusing on the employee.

3. Two-way assessment – Make the review a two-way discussion. Have the employee complete a self-evaluation and be prepared to discuss it. Ask the employee to set objectives for the coming year and work through them along with your objective for the employee.
4. Anecdotal support – Don’t merely point out the good, the bad or the ugly. Support your points with specific examples and cull those examples from the entire year, not the past three weeks.
5. Goal setting – Work through and set objectives. This is perhaps the most critical portion of the employee review. You are not merely grading the past year, but are setting the direction for the months ahead. Do not skimp on this step.
6. Encouragement – The end of the appraisal meeting marks the beginning of the next review cycle. It’s up to you to motivate the employee to continue doing what has been done well and to improve in the areas where there is room for growth. Even an employee who has been disappointed by the outcome of the review can be made to feel they are a valued part of the company.

There should never be any surprises at a performance review. If the supervisor has been doing their job properly, the performance review should be only a formal confirmation of what the employee has already been told.

Further reading:

• What’s to Be Done About Performance Reviews?
• 6 ways to measure worker productivity.

Workers who feel their good work often goes unnoticed may have a case. More than one-third (35 percent) of professionals polled recently said businesses are ineffective at rewarding their employees’ strong performance. Thirty percent of managers surveyed agreed.

The OfficeTeam article goes on to offer four easy yet meaningful ways to recognize staff:

• Say thanks.  Don’t underestimate the power of saying “thank you,” either in writing or in person.
• Celebrate achievements.  Honour employees’ accomplishments in front of their peers.  Staff events recognizing individuals or groups can enhance morale while highlighting exemplary behaviour.
• Give the gift of time.  Reward staff accomplishments with extra days off or extended lunch breaks.  Time away from the office allows staff members to recharge after major projects.
• Provide plum assignments.  Give strong performers the option of working on desirable projects.  Doing so improves their motivation and enthusiasm for their work, and encourages others to excel in their positions.

OfficeTeam – Don’t Let Good Deeds Go Unrewarded

1. 2007 Salary Guide
2. Guide to Certifications for Accounting, Finance and Operations Management
3. Next Generation Accountant Research Guide Next Generation Accountant Research Guide
4. Glossary of Job Descriptions for Accounting and Finance
5. Strategic Plans and Cultural Change in Public Accounting. You can download a portion of chapter 6, Strategic Plans and Cultural Change in Public Accounting, free of charge.
6. 30 Ways to Maximize Employee Productivity
7. How to Hire Smart

Free resources for employers from Robert Half finance and accounting