Small business owners are always looking for tools to increase productivity and improve employee efficiency. Peer reviews can be an effective evaluation of management and employees, but the process has some definite flaws.
Consider these pros and cons when implementing peer reviews:
Con: Reviews can put employees in uncomfortable positions.
Tom Armour, co-founder of Toronto-based High Return Selection, a company specializing in hiring, performance and retention for organizations in Europe and North America, found his first peer review experience when he was employed at another company was less than enjoyable: “Everybody involved was totally demoralized,” he says. “Eight of us were reviewed; and it was very impersonal and difficult for people to give reviews of each other.”
Employees like to form relationships and small communities in the workplace, and Armour suggests that peer reviews force teams to put on a managerial hat, which puts them in an uncomfortable position. “The results can end up being biased to the benefit of members of a clique,” he says.
Pro: Reviews can improve management.
Lindsay Fuchs, corporate operations manager at J.A.B.A. Construction in Saskatoon, Saskatchewan has found success in implementing an anonymous peer review and management review once or twice a year: “We present the survey as a tool to improve management,” she says. “If there’s something wrong in the company, we want to fix it. This is a way to meet those challenges head-on by getting feedback from our employees.”
Con: Focus can shift away from customers.
Fuchs has found that every time employees get a good review, they anticipate that they will get a raise because of it. “Employees assume that their rewards come from the review process and what their peers say about them,” says Armour. “They may shift focus from customer experience to internal relationships.”
Pro: Employees can grow with feedback.
Fuchs says that employees like knowing how the review will affect them, the company and how they can improve: “They want the feedback,” she says. “If they don’t get anything out of it, they’re less willing to do reviews.”
Fuchs suggests telling employees that reviews will not affect wage increases or decreases, so there are no surprises or expectations: “[Peer reviews should reflect] genuine interest in their work performance and how they can do better,” she says.
Related Resources: Tips to Conducting a Successful Review. Part I: Writing the Review and Tips to Conducting a Successful Review Part II: Delivery and Salary Discussions