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February 2016 | Vol. XV - No. 2


Why And How To Do An Employee Review

Employee reviews are one of the most neglected tools a retailer can use to alter their fate.

By using regular employee reviews, you can always be cutting your lower 20% of employees to grow the culture of your business.

That means you never stop hiring, sorry to say.

But are employee reviews really that important? Aren't they just a way of saying, "You're about to be fired?"

The Hawthorne Effect

There was a famous experiment at a Western Electric plant in Cicero, IL during the twenties. Through a set of experiments, researchers wanted to find out the best illumination for worker productivity. They first checked the productivity of the regular factory to establish a baseline. Next they told the crew they were going to increase some of the lights; worker productivity picked up. They added more lights and productivity went up. In the final stage the researchers forgot to turn on the extra lights, yet worker productivity increased. These experiments led to what is now called, “The Hawthorne Effect,” which means that people change their performance in response to any increase in attention paid to them.

That’s why it is so important to stay engaged with your employees, monitoring their progress and finding as many ways as possible for your best to shine.

A necessary element of that is to conduct an employee review. I use one that is just fourteen questions on two pages.

How to do the evaluation

Complete your review the day or night prior.
Tell the employee this review is just part of managing your business.
Don't do it in on a bench in a mall where both of you could easily be distracted. Go over your review in private or somewhere away from other employee's ears, like a coffeehouse or restaurant.

I usually ask the employee each of the questions and ask how they'd score themselves - then concur or tell them why.

It is important you cite specific behaviors they do that support your rating. Don't just say, "You always have to be told what to do" but add one recent example.

You want this to be seen as much a review of your management skills as their employee skills so even if you don't feel comfortable the first time, it gets easier as you see what you could do better for your employees.

You should complete one 30 days after you’ve hired a new employee, 90 days after that, and then once every six months. You can just set up a reminder in Outlook or in your smartphone calendar.

Your employee reviews make sure you notice the things that make an employee a great employee. It allows you to give feedback on your concerns, hear theirs and sometimes yes, to reward them with a raise or deliver a reprimand.

Think of an employee review as just a chance to get together around a set of questions. You don’t want to set up the expectation that they will get a raise each time or there’s something bad about to happen – a review is just part of your process to better your retail sales.

Bob PhibbsWriter's Bio: Bob Phibbs is the Retail Doctor®, a best-selling author and speaker who has helped thousands of independent businesses compete. His new book, The Retail Doctor’s Guide to Growing Your Business has received praise from both Inc. magazine and USA Today and can be found at your local bookstore or ordered at He and his work have been featured in the New York Times, the Wall Street Journal and Entrepreneur magazine. Questions? Contact Bob at This article was reprinted with permission of the author, Bob Phibbs, aka The Retail Doctor®. Read more articles by this author


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