Team Member Evaluation

For many managers, end of year is when you’re asked to review the performance of your team members. And while there are many great reasons to reject the idea of an annual review in favor of regular performance feedback throughout the year, at some point, a manager has to decide how to allocate increases in compensation.

On one hand, it’s tempting to say, “We don’t evaluate individual performance. The team succeeds or fails together.” And there’s some value in that kind of thinking, especially when a focus on performance metrics that are easy to measure tends to distract people from the valuable behaviors that don’t have metrics.

At the same time, individual compensation that’s completely disconnected from performance can be demotivating to your high performers, pushing your overall team performance down.

To find a good balance across everything that’s important for long-term success, a Gallup study suggests evaluating three different dimensions of performance:

1️⃣ Individual achievement
2️⃣ Collaboration with team members
3️⃣ Customer value

But when you try to measure those, you can lean so hard on data that it’s easy for poor performers to game the system. On the other hand, a purely subjective review tends to perpetuate biases that overlook strong performance where you don’t expect to see it.

The Gallup study suggests tapping three sources of information to make your evaluation:

1️⃣ Performance metrics. Don’t be completely data-driven, but at least let your decisions be data-informed.
2️⃣ Subjective observations. But don’t rely just on your own observations; actively solicit the input of team members, colleagues, and customers — whether internal or external.
3️⃣ Individualized goals. Considering each person’s individual strengths and responsibilities, work together to set distinct growth goals, and measure their progress.

By deliberately broadening your types of evaluation and your sources of input, you can make informed compensation decisions that balance individual performance and contribution to overall team success.