Performance Evaluation: A Complete Guide from A to Z

Feb 10, 2022 | Performance Management, Professional Development

Solid performance evaluation helps employees continuously improve. However, many organizations are realizing they’re using old methods. So, they’re rethinking current systems by choosing a new rating scale. They’re rewriting the questions they use. Or, they’re holding reviews once per quarter instead of once per year.

Most importantly, many companies are recognizing the need for ongoing feedback. Just 14% of employees say performance reviews help them improve. But with weekly feedback, they’re five times more likely to find reviews beneficial. 

Read on to learn about the purpose of a performance evaluation. We’ll then look at rating scales and questions that lead to insightful results.


1. What is the purpose of a performance evaluation?

2. Types of performance evaluation rating scales

3. Best practices for evaluating performance

What is the purpose of a performance evaluation?

The purpose of performance evaluation is three-fold:

  • It gives employees a strong understanding of their progress. They learn about strengths and current needs for improvement.
  • It helps companies determine whether their people have enough resources. They’ll see where they need to give more time and effort.
  • It helps organizations decide on promotions, role changes, and raises. Managers can make well-informed recommendations to leaders.

A performance evaluation can be used for all employees. That includes employees, managers, and senior leaders. Everyone will benefit from evaluation—when it’s done well. 

Types of performance evaluation rating scales

Optimize your process by thoughtfully choosing a rating scale. Then make sure all managers understand and use it. HR should select a scale and train managers on it.

Graphic Rating Scale

This scale measures whether employees display certain traits and behaviours. For instance, it can evaluate teamwork, ethics, and timeliness. Managers use a simple scale to rate employees. 

The Likert scale can be used. It includes simple descriptive options like these:

  • Exceptional
  • Exceeds expectations
  • Meets expectations
  • Needs improvement 
  • Unacceptable

Similarly, a semantic scale presents two options at each end of a spectrum. The scale includes several boxes (or bubbles) between them. The reviewer checks the one that most accurately describes the employee. Alternatively, the scale might prompt reviewers to mark the appropriate point on a continuous line. You can also use a simple numeric scale (1–5 or 1–7).

Let’s look at some questions you might find on a graphic rating scale.

Sample questions:

Ratings: Unacceptable / Needs improvement / Meets expectations / Exceeds expectations / Exceptional

Does the employee…

  • deal with problems quickly, before they grow?
  • express ideas in a concise, organized manner?
  • maintain strong communication throughout the workflow process?
  • show up to meetings and appointments on time?
  • effectively explain new concepts to others?
  • display strong writing skills?
  • handle disagreements promptly and professionally?

Note that each of these questions relates to a specific trait or behaviour.

Man holding performance evaluation form
Credit: DoxaDigital/Canva

What are the pros and cons of this rating method?

  • Easy and intuitive to use. Most people have used this type of scale for a performance evaluation before.
  • Focusing on traits and behaviours aligns well with some managers’ coaching approach.
  • Answers lack detail. However, managers can expand on answers when delivering the review.
  • Managers could feel confused about which answer to select. A “3” can signify something slightly different to two different managers. That’s especially true when evaluating personal qualities rather than results. Answers could therefore be subjective and prone to bias. Proper training can help overcome this issue.

Management by Objectives

Management by objectives (MBO) is an entire performance management framework. With MBO, top leaders first set company goals (and their own goals). Then, employees beneath them set personal goals. Employees at each level will have goals that support those of their manager

The MBO rating scale evaluates progress toward goals and objectives. This scale applies to every type of role. The questions will differ based on the employee’s objectives.

Sample questions

Ratings: Strongly disagree  —  Disagree  —  Neutral —  Agree  —  Strongly agree

  • Did the employee successfully lead the implementation of a new marketing plan by Q2?
  • Has the employee effectively onboarded the two new hires?
  • Did the employee successfully complete Report A?
  • Has the employee delivered persuasive weekly presentations to potential clients?
  • Did the employee achieve X new conversions per quarter?

A Likert scale is sometimes used for the answers, as with the above questions. Questions can also be presented in statement form:

  • The employee successfully managed the production process from start to finish.

Strongly disagree  —  Disagree  —  Neutral —  Agree  —  Strongly agree

What are the pros and cons of this rating method?

  • Designing the rating scale is straightforward. Objectives were already set; the scale simply ranks their success in achieving them. 
  • The scale promotes objectivity and fairness. Questions focus on goals that the employee ideally helped set.
  • The scale takes relatively little time to complete. Managers already have a strong understanding of what each rating means.
  • The scale could focus strongly on outcomes but not the development of abilities. After all, MBO emphasizes results, not the process of achieving them. The manager should reflect on areas of growth that questions may not specifically address. For example, the employee may be developing leadership skills that could support next-level goals.
  • Adopting the entire MBO framework takes time and effort. However, this time investment can pay off substantially. It’s a smart way to manage goals throughout the organization.

BARS (Behaviourally Anchored Rating Scale) 

What is the BARS scale? Questions on the BARS pertain to particular behaviours. The rating options themselves have a high level of detail. Each answer presents a specific behaviour. The reviewer selects the one that most closely reflects the employee’s performance.

Sample BARS questions for a performance evaluation

BARS question for a manager:

How effectively does the manager deliver constructive criticism?

  • By sharing difficult feedback in a direct but extremely supportive manner, the manager motivates employees to address it immediately.
  • The manager delivers clear feedback with a positive attitude.
  • The manager provides some valuable input but can sugarcoat the truth or be too blunt.
  • In most cases, the manager is either too vague or overly harsh.
  • The manager rarely or never provides criticism of any kind.
BARS performance evaluation question for an IT employee:

How effectively does the employee deliver presentations on data security?

  • The employee delivers outstanding presentations and proactively follows up with those who want more information. Staff members leave committed and empowered to improve data security.
  • The employee shares key concepts in a clear manner and encourages employees to reach out for follow-up support.
  • During presentations, the employee provides staff with a reasonable grasp of how to promote data security. Presentations could be more engaging or thorough, however.
  • When sharing information, the employee talks over people’s heads or doesn’t connect ideas. They learn very little, as a result.
  • The employee rarely or never shares information with other staff.

When should you use the BARS? A BARS rating scale can be useful for any role. From leaders to interns, it provides clear and specific feedback. However, HR must develop different questions for particular roles and levels. Attempting to use the same BARS for everyone wouldn’t work, as questions are role-specific.

What are the pros and cons of this rating method?

  • Descriptive rating options encourage more accurate ratings in each performance . On a simpler scale (e.g., 1–5), it can feel tough to assign a low rating. Managers often gravitate toward the middle of the scale. The BARS overcomes that issue.
  • Similarly, the BARS ensures consistency across reviewers. It leaves little room for interpretation of what a given rating means.
  • It’s easy to show employees exactly how to improve specific behaviours. The ratings themselves state what strong performance looks like.
  • Developing BARS scales for all employees takes time.
  • Performance evaluation adjustments may be needed as positions change.
  • The BARS answers could leave out relevant behaviours. A manager could feel confused about which rating to give if this occurs. Carefully writing the questions can help avoid this issue. HR should design them with a manager who has a strong grasp of the role.
  • Some organizations are adopting flexible roles with shifting responsibilities. Managing BARS scales may require extra effort in such cases.
3 dice showing different performance evaluation expressions
Credit: Gajus/Canva

Best practice for evaluating performance

Train managers to use the following best practices in a performance evaluation.

  • Compare current and past evaluations, determining if the employee is on a “downward” or “upward” slope. In other words, consider whether improvement has occurred. Discuss this change with the employee. The direction of change should also inform goal-setting and the support you offer.
  • Use a clear rubric for ratings. (If using the BARS, the answers themselves serve as this rubric.) All managers should understand how to use the same rubric.
  • Explain how the rating scale works to employees. 
  • Provide overall impressions on an employee’s performance first. Then dive into the nuances. (Stumped on how to provide feedback in performance reviews? Read this article!)
  • Ask for the employee’s reaction to the feedback. Consider any relevant points the employee makes. 

In Human Resource Management, Daniel R. Tomal and Craig A. Schilling emphasize the importance of setting the stage for the review. Candidly explaining its purpose, scoring method, and topics covered will achieve that goal.

Investing time and effort in your performance evaluation process will pay off. Make sure you implement your system throughout the organization. This will help leaders and HR make the best decisions about promotions, salaries, and lateral moves. Follow the best practices outlined here, and you’ll maximize the benefits it brings!

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