Best Practices for Achieving Talent Success Maturity

The Managerial Performance Review

  • Who it’s for: 
    Managers who give performance reviews of other managers
  • What you’ll get: 
    A review for employees who primarily manage other employees
  • Why you need it: 
    Managers should be reviewed differently from regular employees
  • When it applies in the talent success process: 
    During the performance review cycle

Managing employees is a unique job with special importance to your company. This article presents a set of best-practice templates for reviews that will help managers to understand their performance in the context of objectives, competencies, and future development.

The Importance of Managerial Reviews

Managerial employees play a pivotal role in your company’s ability to recruit, retain, and develop A-players — and in deploying them to achieve key business goals. Managers as a group share a unique set of responsibilities. Using managerial reviews to help them better understand their strengths and weaknesses can increase their productivity and ensure that they are doing their part in helping the company to build, retain, and develop a strong team.

Good managerial review processes can yield a huge return by preventing voluntary turnover of high-performing employees. Surveys by Gallup and other research firms consistently show that departing employees are more likely to attribute why they’re leaving to their managers, not their specific job or the company. A 10-year, 100,000-employee study by O.C. Tanner and HealthStream showed that over 75 percent of departed employees left because of their manager.

Ultimately, managers are the face of the company for their employees. They can play a vital role in communicating the company’s mission, vision, and goals to their employees to inspire performance and drive engagement, or they can inspire your top performers to leave. Because they give you the data to spot problems early, well-designed managerial reviews are a best practice that will increase performance and retention across all employees.

Growing your managers benefits every part of the business: employees, customers, and the bottom line.

How Managerial Reviews Are Different

By definition, managers have a different set of responsibilities than non-managerial employees. In addition to managing tasks and projects, they also manage people — and their managerial style often has a large impact on the productivity of those people. This needs to be taken into account in performance reviews.

Managers Need to Be Assessed Differently

“Management isn’t always intuitive,” says Laszlo Bock, Google’s senior vice president of people. “You got promoted because you’ve done good work, you’ve hit your goals, and you’ve made good decisions. But now you’re responsible for others. Your whole mindset shifts as a manager.”

Google and other companies use research-backed methods to improve manager performance, have happier employees, and create overall increases in productivity. Many companies are also beginning to focus more on the people side of their business in evaluating and improving managerial performance. One change they’ve made is to put increased emphasis on managerial competencies in performance reviews.

Creating the Managerial Review

Managerial reviews need to be done with a degree of context and thought. If a manager feels they’re not being evaluated fairly and decides to depart, that will have repercussions far beyond simply that manager’s exit.

Managerial Reviews: The “Who”

The first step is determining who will review each manager. There are a few different options:

  • Performance evaluated solely by the manager’s manager (and possibly department head or skip-level supervisor)
  • Performance evaluated by the manager’s manager and the manager’s peers
  • Performance evaluated by manager’s manager, manager’s peers, and manager’s direct reports

That’s the “who” of the managerial review equation.

Managerial Reviews: The “How”

Once you decide who will be offering feedback on the manager, you need to get the feedback. This is the process portion of a managerial review, or the “how.”

Refer to the manager’s competencies you defined in the hiring process and create a survey for all those will be offering feedback. Make the due date for this survey three to four weeks prior to the actual review, so the manager’s manager can have time to go over the results and prepare the review.

The survey should be based around the competencies. Examples could include:

  • Communication Behaviors
  • Leadership Behaviors
  • Valuing Diversity Behaviors

For more on the potential competencies to tie into a review, a sample review is at the bottom of this post.

Typically, the survey will be on a 1–5 or 1–7 Likert scale (1–7 allows for more variability), with 1 being unacceptable and 7 being outstanding.

Now, you’ve determined who offers feedback and you’ve collected the feedback. What’s next?

Managerial Reviews: Actually Conducting Them

First, set a time frame in advance. When the meeting invite is set, briefly define the expectations of the meeting — namely, that the manager’s performance will be reviewed based on feedback from X-number of parties, and the manager will have an opportunity to ask questions regarding the feedback.

At the review, the feedback given to the manager should focus on competencies and how those behaviors led to the successful (or unsuccessful) achievement of goals.

You can refresh on competencies here.

After the feedback is presented by the manager’s manager, they should engage in a question-centric dialogue. The manager should feel free to ask for clarifications and push back on areas of concern.

The dialogue should flow toward a mutually agreed-upon development plan, where the manager commits to focus on specific competencies. The manager’s goals for the next performance review cycle may also be adjusted within the development plan; we don’t recommend lowering the bar on goals, but the discussion may have yielded insight that some goals aren’t measurable or don’t align with that manager’s major priorities. This is where interpretation of the managerial review can begin.

Interpreting the Managerial Review: Moving From Data to Action

A well-structured managerial review provides valuable data to coach and develop better managers. Because of the impact a single manager has on many employees, the return on investment in efforts here is magnified.

Interpreting Managerial Reviews

There are a number of different scenarios that can present themselves once you have managerial review data. Some include:

Achievement of Team Goals

Managers need to have defined goals for themselves and their teams. In the context of team goals, they should be measurable (all corporate goals should be, ideally). This is a simple metric, then: Are the team goals being met? If they’re not, the causes need to be explored with the manager. Example: 25 percent reduction in inventory held. If the operations team only achieved a 5 percent reduction in inventory held, the manager is accountable to that. Considerations need to be run through. If all your goals are being achieved, that’s a great start. In a review of that nature, the focus can shift to more intangible or “soft” skills that a manager should possess as well, such as effective communication or listening. Those don’t show up on a balance sheet, but they are important to continuing strong results.

Many Positive (or Negative) Managerial Reviews

If the business is doing well and most of the managerial reviews are positive, this could be a good situation — a correlation between managerial effectiveness and business success. However, it could also mean the competencies are too broad, poorly defined, or too easy to score high on. If many of the managerial reviews are negative, that could signal an overall decline in culture — people don’t like working there across a variety of managers. It could also mean you have the wrong people in management. How you analyze an excess of either category varies by your specific situation, but it merits further analysis in any case.

Goals Relative to Individual Employees

A sales team manager might show up as achieving all of their team goals as noted above, but here’s a possible scenario: They manage 10 reps, and two had an amazing year. The other eight were all short of meeting their goals. This could mean the manager is riding on two superstars, and isn’t necessarily good at either hiring or developing their employees. Context is important when looking at achievement of outcomes.

Turnover Rates Relative to Peers and the Company

Does this manager have a higher or lower turnover rate (employees departing) than peer managers or the company rate as a whole? This has a number of causes: It’s possible the job roles under that manager are very unclear, hence employees are departing. In that scenario, you need to clarify needs and priorities for that manager’s team — and you might want to restrict their ability to demand new headcount. High turnover can also directly point to poor management. As noted above in the O.C. Tanner study, 3 in 4 employees report leaving a job specifically because of their direct boss.

This is just a snapshot. Many different patterns about your managers can reveal themselves in the data from the reviews. It’s important to have an analysis plan in place, however.

Managerial Review Sample

The first sample below shows a potential managerial review. (The employee’s and manager’s names are fake.) This sample is done on a 1–5 scale. You can think of it as a way to approach your first reviews of managers: a few core competencies, evaluated on a standard scale, with comments and action items following.

This next graphic is a quick example of a dashboard you should be utilizing. In this case, you can look at employee turnover by month, quarter, year, or other time window and sort that information by manager. Any performance management software you use should be able to sort any major data field by different managers, in order to provide a framework for evaluating the different leaders in your company.

Continue