Performance Review Preparation: Why You Should Start Now
You're probably wondering why you should start preparing for your performance review now. Well, I'm here to tell you that if you want to increase your salary, there is no time like the present to start getting ready.
A lot of folks wait until the last minute to start preparing for them, but believe me when I say that this is a mistake. By starting now, you'll be in a much better position to get a raise or promotion. You'll get a look behind the scenes of the Annual Performance Review as well as how to make your self-assessment successful and save time.
In This Episode, You Will Learn About:
A glimpse into the annual performance review process
Highlighting your accomplishments on your self-assessment
Time-saving tips for managers and self-assesments
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Inflation vs the Annual Merit Increase
Would it interest you to get a glimpse into the annual performance review process? What makes now the best time to prepare for your annual performance review? This episode will go behind the scenes of the annual performance review process. So you can set yourself up for success during your self-assessment and maximize your merit increase.
There are two statistics I wanna share with you. The first one is according to trending economics, the annual inflation rate in the US as of July 2022 is 8.5% from an over 40-year high of 9.1%. The second statistic I wanna share with you is according to the research study by the conference board’s long-running salary increase budget survey, which includes 180 organizations. The medium salary increase budget is 3%.
Right now, the annual merit increase is 3%. However, inflation's at a high of 8.5. Now more than ever, it's extremely important to set yourself up for success and prepare for your annual performance review now so that you could potentially be getting above that 3% and getting “exceeds outstanding” expectations.
What it Means to be in the Nine Box
I'm gonna share a story with you. I had a very alarming experience, or I would say, maybe an eye-opening experience. When I became a manager for a Fortune 500 company over 10 years ago, it was my first manager's meeting. And I was asked to prepare an assessment of each person on my team. I was asked to prepare a PowerPoint presentation and on each side would be an assessment of each person.
It would have their name, their tenure, how long they've been with the organization, what their personality traits were, what their strengths and their areas of opportunity were. Then, at the end of the presentation, I was asked as well as all the other managers to put each person in a nine-box.
If you're not familiar with the nine-box it's okay. I didn't know it at the time either as a first-time manager. The nine-box grade is an individual assessment tool that evaluates an employee's current and potential level of contributions to the organization. What it looks for is how your overall performance and how your overall potential are. It looks at:
their strengths
how long they've been with the organization
what are their opportunities
are they relocating?
And when you're putting each person in this grid, it's looking at, “Does their performance align with behaviors? Is this person interested in getting promoted or not?” That was in preparation for the manager's meeting, but here's what happens behind closed doors that most people don't know.
And I'm sharing a little secret with you. Eventually, when we got to the manager's meeting, all of the other managers sat in a room and one by one, each manager presented their overview of their team, each individual person, and how they fit in that nine box. Now, this exercise is extremely helpful because it opened conversations by saying, “Hey, I might be struggling a little bit with this particular person. Maybe I don't necessarily know where they want to go. Maybe some opportunities within the organization? Maybe they're not performing at the level of some of their peers and how can we get them to that next level?”
It was a great exercise because it opened up the conversation and helped us managers come together with some ideas and some solutions to get everybody going in that high potential and high performance. It also was pretty alarming when it looked at, “Are we hiring the right talent? What's the percentage of people that are potentially going in that box that we need to maybe move them out of the organization?” And so when I was going through this exercise, it was a very eye-opening experience of what happens behind closed doors, as well as who's gonna be the person in that room. When my manager's doing the same exercise about their management team, who's gonna be the one advocating for me, putting my best foot forward?
When filling out my self-assessment, when filling out the annual performance review for that merit increase, or to potentially go in that nine-box where that's at promotable, how annual performance reviews are measured is pretty much similar compared to any industry that you're in, but it looks at your overall rating. It looks at who’s outstanding. Are you achieving or meeting your expectation below or unsuccessful? Some organizations will base it on certain measurables. Maybe based on certain metrics that they measure each particular area within the annual performance review, while others might actually take a bell curve type approach as when you're looking at your annual performance review, even if you don't have it currently right now in front of you, or maybe you won't have it for a couple of months. Typically in annual performance reviews, the self-assessment happens at the end of the calendar year or at the end of the fiscal year.
What can you do?
The first step in setting yourself up for success is reaching out to your manager and double checking and saying, “Hey, what are the key strategic initiatives for our organization? And what are the key strategic initiatives for my particular role?” Typically, an organization has five key strategic initiatives that you are being measured on your annual performance review. So knowing those ahead of time will help you build your self-assessment so that when it comes time to fill your annual performance review, you already have all of your accomplishments and achievements ready to go. And it's a matter of copying and piecing it because you've put that time in ahead of time.
When you're looking at each key strategic initiative, let's say, for example, it's sales performance, you're going to then put how you measure yourself. So an example might be: “meets expectation” is a hundred percent, 110% might be “exceeds expectations” and 120% of your sales quota might be “outstanding.”
It's different for every organization. As I said, the company that I previously had worked for, went off of a bell curve. And one of the challenges with the bell curve is if the organization overperforms that number, but you were at the bottom 33%, even if you had hit a hundred percent, they might put you below expectations because based on the bell curve, it wasn't as high as everybody else.
I have mixed emotions about that because to me, if you are hitting a hundred percent, you are meeting the expectation when it comes to rating. In each of the key strategic initiatives, what you're going to want to prepare is a star format for each key strategic initiative.
What's going to look like about the specifics of that particular key strategic initiative?
What was the task to achieve it?
What actions did you take to achieve that goal?
And what was the result?
For example, if the key strategic initiative is to hit a hundred percent of your quota, what are the specific steps that you have taken throughout this previous year to hit your quota? The task was to hit the quota.
What were some of the actionable steps that you took and what were the results?
What steps did you take to grow your business?
If leadership is one of the key strategic initiatives because you are part of leading a team, you're a people manager:
What were some of the ways that you attracted top talent?
How did you onboard your team?
How did you create collaboration among your team?
Were there certain individuals that were promoted within your organization?
What steps did you take to help them prepare for that promotion?
You wanna be very specific in your annual performance review on your self-assessment because you know your business better than anyone. Your manager knows what you're doing based on the performance on reports and based on what they observe and what you tell them. But they're not always in the car with you. They're not always working alongside you. So this is your time to shine. This is your time to share exactly what you've been doing to set yourself up for success and achieve the goals of the organization and what they've laid out. Reach out to your manager right now, at some point today, reach out to them, and ask them what are the key strategic initiatives.
Also looking at behaviors, a lot of organizations not only look at what the key strategic initiatives are. They also look at what are the behaviors that they're wanting from their organization that is going to foster the company culture that they want. Also, they may look at core values. How do the people that are working for the organization? What steps are they doing to align with the core values of their organization? Again, any time that you're filling out any of these measurables on your annual performance review, you wanna be very specific about the details.
What was the specific core value?
What was the task to achieve?
What were the action steps to achieve that core value?
What were the results?
One, for example, if collaboration is a core value among that organization, what steps did you take to collaborate with your peers, with your teammates, and with other divisions within the organization? How did you collaborate with your customers to help them achieve their goals? Be very, very specific. And as you go, one of the things that you can do is the beginning of the year. When you find out these key strategic initiatives, you find out what you're measured by. Have an ongoing list. Every time that you have a win, something that's worked well, something that has exceeded the expectations, or you've heard from your manager.
If that was a great idea, tally it, and write that down. Maybe you have a word document and you just kind of keep it open on your desktop and you continue to add to it. If you didn't do it at the beginning of the year, it's okay. You still have time to do it. But keep track. One of the things that I did as a manager is I had a word document and I had all the key strategic initiatives at the top of it. And then I had each person's name below and as successes would happen throughout the year, I would just write under each person's name. Here was the success story that they had. I wanted to make sure that I captured all of them throughout the year to put them in the annual performance review when I was doing the supervisor evaluation.
Because part of the annual performance review is you are going to do your self-assessment and then your supervisor or manager's going to do their assessment as well. It's important that you are keeping track. Also, if you are a people leader out there, we don't always remember all the successes that took place throughout the year when we're asked to do this one time a year. So be proactive and start keeping a running list so that when it comes to the time when you're doing 9, 10, 15 annual performance reviews at once, you can easily cross reference that list and then go into more detail when you're writing out the annual performance.
Also, keep in consideration that annual performance review time is a great time to reevaluate your individual development plan. Your individual development plan is how you prepare for that next step in your career. It's how you go into:
What are my goals?
What are the strengths that I possess?
What are some of the opportunities to get me to that next level?
And I'm gonna go into detail in next week's episode on how to build an individual development plan. But what you wanna start thinking about today and why now is the best time for that annual performance review is starting to write yourself an assessment because again, the medium range for the merit increase is 3%.
Most companies do a range between zero, if you're unsuccessful, and one to two, if you are below expectations, meets expectations is typically about a 3%. But if you wanna get to that four or 5% on that range of the annual performance review merit increase, ensure that you are preparing now and make sure that you are writing down everything that you've done to contribute to the organization and how you achieve your goals in your current role, but more importantly, what are you doing that's outstanding that warrants that 5% merit? This might be a good opportunity to also open up that conversation with your manager. What are some questions that you can ask them to uncover? Well, what's important to them on their team? Every manager is a little bit different. And so there's gonna be the expectations of the organization.
There's also gonna be the expectations of that particular manager. What is important to them when they're looking at who is exceeding and outstanding within their team? I know that one of the qualities that I looked for as a manager when I was evaluating my team and doing the manager evaluations wasn't just about how are you performing in that role but how are you proactively helping the other people on the team and showing up as a leader, doing your role.
“Meets expectation” is a good score to have on your annual performance review. And if you're striving to get that “exceeds” and “outstanding,” then that means going above and beyond your immediate role and contributing to other areas within your team and the organization. And that's proactively supporting other people. And if it gets to a point where you are proactively helping other people on your team, then share that with your manager—again, sometimes they don't always know what they don't see. So it could be you including them in an email. It could be you going to your manager and saying, “Hey, I've got this great idea that can support our team. Go through it's X, Y, Z. And would you be interested in me sharing this on my next team call? Would you be interested? Do you think this would be helpful in sharing this amongst the team as well?” That right there is a leader that is right there is proactively supporting your team. And that's what warrants that “exceeds” and “outstanding” on annual performance.
