Performance reviews are more than just a task on a manager's to-do list; they are opportunities to inspire and empower employees to achieve their full potential. In this guide, we'll explore the essential elements of conducting a performance review that motivates both managers and employees. From setting clear expectations to leveraging personalized feedback, each step is designed to create a collaborative and supportive environment for growth and development.

Key Takeaways

• Collaborate on performance and growth plans – combine employee self-assessments with manager observations, highlight achievements, provide actionable feedback, and set SMART goals.
• Document and follow up – record key discussion points and maintain consistent check-ins to support ongoing development.
• Prepare thoroughly – gather examples of successes, areas for improvement, and role expectations to ensure a productive conversation.
• Follow a structured agenda – start with accomplishments, discuss development opportunities, and conclude with goal-setting.
• Encourage two-way dialogue – invite employee input to build engagement, trust, and clarity throughout the review.
  
  

Performance reviews: a key element of performance management

Performance reviews are a cornerstone in your performance management cycle. Done effectively, performance reviews help managers strengthen alignment and coach to better performance. They help employees understand expectations, communicate progress, and develop a path for growth.

Managers should have many types of performance conversations—outside of an employee performance review—with employees throughout the year. Ongoing feedback that helps employees adjust and grow in real-time. But the performance review is an opportunity to formally assess an employee's work over a given period, through a face-to-face conversation.

Most organizations conduct annual performance reviews, but these reviews can also be conducted quarterly or even monthly.

Benefits of effective performance reviews 

Performance reviews have gotten a bad reputation over the years. This stems from outdated practices and ineffective implementation of reviews.

Employees at all levels have described performance appraisals as bureaucratic and time-consuming. Reviews often feel like check-the-box formalities, lacking meaningful feedback and opportunities for growth. The annual cadence and focus on past performance, as well as the emphasis on performance ratings, doesn't help managers course correct or employees develop and grow. And the subjective nature of reviews often leads to biases and inconsistencies that leave employees feeling disengaged.

That's a lot for organizations to overcome in their performance review process. But effective performance reviews offer benefits for everyone.

For leaders, performance reviews provide invaluable insights that can lead to more informed decisions around promotions, training, and resource allocation—ultimately improving the overall success of the business.

For managers, reviews offer a platform for providing feedback, setting goals, and aligning team member objectives with organizational objectives. They’re an opportunity to recognize and reward top performers—and address any performance issues or concerns in a timely manner. Done thoughtfully, performance reviews help foster open communication between managers and employees. They help strengthen relationships and promote a culture of transparency and accountability.

For employees, performance reviews can be valuable opportunities for growth and development. They can get direct feedback on their work, gaining insight into where they excel and where they can improve. Reviews can empower employees to set goals, track progress, and take ownership of their development.

Preparing for a performance review

A performance review will only be as good as the thought that is put into it. Preparing for a performance review is essential for managers and employees alike.

Managers should spend time reflecting on and reviewing the employee's performance, gathering specific examples of successes and areas to improve. They should consider how to provide relevant feedback and coaching based on the employee's goals and responsibilities.

Employees should also take time to reflect on their performance during the review period. They should come prepared to discuss progress, obstacles, and opportunities with their managers. They should also consider their career aspirations and where they'd like to grow and improve.

When managers and employees both prepare for a performance review, the conversation can be much more productive and meaningful.

Drafting constructive feedback 

Providing constructive feedback is a crucial aspect of the performance review process. By offering feedback that is specific, actionable, and linked to performance expectations, managers can help employees understand how they can improve and excel in their roles. Here are some tips for drafting constructive feedback:

• Be specific. Provide concrete examples of both successes and areas for improvement. This helps employees understand behaviors or actions that have impacted performance.
• Be action-oriented. Instead of focusing on what went wrong, provide suggestions to improve. Offer coaching, resources, or training to help employees develop necessary skills.
• Link feedback to performance expectations. Tie your feedback to the performance expectations set for the employee's role.
• Balance strengths and areas for improvement. While it is important to address areas where improvement is needed, also acknowledge and celebrate the employee's strengths. Recognizing good performance can boost morale and motivation.
• Encourage a growth mindset. Frame feedback as an opportunity for growth and development. Emphasize that constructive feedback is meant to help the employee improve and succeed in their role.
  
  

Check out our article on performance review example phrases, comments, and questions to help you draft constructive feedback and facilitate a more engaging review conversation!

How to Conduct a Performance Review 

A performance review is a focused, purposeful conversation that helps managers and employees understand what’s working, where growth is needed, and how to move forward with clarity. It’s more than an annual task. It’s a strategic opportunity to strengthen alignment, reinforce expectations, and support the continuous feedback employees need to thrive. 

As AI-driven tools surface patterns, reduce bias, and translate performance data into clearer insights, organizations can conduct reviews that are more consistent, objective, and impactful for every employee.

Preparing for the Performance Review

Preparing for a performance review means organizing the right information so the conversation is fair, clear, and informed. Managers should enter the review with a complete picture of the employee’s work and progress.

Key steps to prepare:

• Gather evidence, including performance metrics, peer feedback, and work examples
• Review employee self-assessments for insight into their perspective
• Revisit past performance conversations and goals
• Use AI-enabled tools to identify trends, summarize data, and reduce blind spots

Conducting the Performance Review

Conducting a performance review involves creating a structured, supportive dialogue that helps employees understand strengths, opportunities, and expectations.

How to conduct an effective review:

• Start with a simple, shared agenda
• Create a comfortable environment that encourages open conversation
• Offer constructive, specific, and balanced feedback
• Invite two-way dialogue to deepen understanding
• Use AI-assisted prompts or summaries to stay focused and consistent

Setting Goals and Following Up

Setting goals and following up turns a performance review into a clear action plan. The goal is to build momentum, maintain alignment, and support employee growth long after the review ends.

Best practices for goal-setting and follow-up:

• Collaborate on goals that are specific, measurable, and tied to priorities
• Provide ongoing support through coaching, resources, and regular check-ins
• Follow up effectively by documenting commitments and revisiting progress
• Use AI-driven reminders or dashboards to maintain visibility and accountability
  
  

Tips for Conducting a Performance Review 

Effective performance reviews are clear, consistent conversations that help employees understand how they’re performing and what comes next. The best reviews create alignment, strengthen trust, and turn feedback into actionable next steps. 

Tips for conducting an effective performance review:

• Prepare thoroughly by reviewing evidence, self-assessments, and past goals
• Set expectations early with a simple agenda and clear objectives
• Create a comfortable environment that encourages open conversation
• Deliver balanced feedback grounded in real examples and outcomes
• Encourage two-way dialogue to deepen understanding and build trust
• Stay focused and fair by using structured questions or AI-supported insights
• Document key points so both parties walk away with clarity
• End with next steps that translate insights into meaningful goals

How Quantum Workplace can help you streamline performance reviews

Performance conversations don’t need to be hard. Keep your managers and employees on the same page with engaging performance reviews. Our performance review software gives your teams reliable context to help them have more objective and engaging conversations.

2. Help your managers build positive performance habits. Make it easy for manager to coach to performance by integrating your process into their existing workflows. Set up formal conversation cycles to create the right frequency and consistency of touch points.

3. Easily track review response rates.  See the status of each review cycle to help your teams stay accountable and monitor performance ratings in real-time.

4. Embed performance goals directly into reviews. Our platform makes it easy to include performance goals as part of performance evaluations—and helps coach managers have objective, effective, and growth-oriented conversations.

5. Orient reviews around multi-rater feedback. Incorporate feedback into your review cycles to gain valuable insight from the individuals your people work with most, and better orient  performance conversations around development.

6. Visualize and align on performance data across teams. Get a comprehensive view of your organization’s talent with our talent dashboard. Zoom out and see the big picture, to help you make more informed decisions on how to keep and develop your best talent.

 

Conclusion: Key Practices for Effective Performance Reviews

Conducting performance reviews that motivate and inspire requires a structured and thoughtful approach. To empower employees and drive organizational success, leaders should focus on the following key practices:

• Adopt a collaborative approach: Engage employees in the process by encouraging their input and fostering two-way communication.
• Provide constructive feedback: Offer clear, actionable insights that help employees understand their strengths and areas for improvement.
• Set clear goals: Define measurable objectives to align individual performance with organizational priorities.
• Foster open communication: Create an environment where employees feel supported and encouraged to discuss challenges and opportunities.

By implementing these strategies, HR and managers can create a productive review process that supports growth and contributes to the success of the organization.

How to Conduct Performance Reviews FAQs

What should be included in a performance review agenda?

A performance review agenda guides a structured conversation that’s focused, fair, and actionable.

Key elements to include:

• Welcome and purpose – set a positive, collaborative tone
• Review of past performance – highlight accomplishments and opportunities for growth
• Strengths and development areas – provide clear, constructive feedback
• Goal-setting discussion – align on short- and long-term objectives
• Employee input – encourage reflections, questions, and two-way dialogue
• Next steps and follow-up – ensure clarity on action items and ongoing support

How often should performance reviews be conducted?

Performance reviews should happen at least once a year, but more frequent conversations improve alignment, engagement, and growth.

Recommended approach:

• Annual review – in-depth, formal evaluation of performance, development, and career growth
• Quarterly, semi-annual check-ins – adjust goals, recognize progress, and address challenges
• Ongoing feedback – continuous coaching to support development and reinforce strengths

Why is it important to set goals during a performance review?

Setting goals transforms performance conversations into clear action plans that drive development and engagement.

Benefits of goal-setting:

• Clarifies expectations – employees understand what success looks like
• Supports growth and development – identifies opportunities to build skills and capacity
• Boosts motivation and engagement – employees feel supported and focused
• Enables accountability – progress can be tracked and celebrated
• Aligns individual and organizational priorities – ensures efforts advance team and company objectives

Make your performance review process more effective, efficient, and engaging. Quantum Workplace's performance review software helps your managers and teams prepare for, facilitate, and follow up for better reviews and better performance.