In a BLR webinar titled "Compensation 101: Essential Secrets and Strategies for HR Professionals," Paul R. Dorf discussed the keys to evaluating performance and discussing issues and concerns.

Performance evaluations should be periodic and frequent meetings between the supervisor and the employee. There should be a high level of employee participation, and mutual goal-setting. The manager should display a helpful and constructive attitude, which leads to solutions to job problems. Goal setting is critical to any incentive program. The goal must be known and it can't be continually moving.

Also during performance reviews employees and managers should have the opportunity to discuss issues and concerns. Employees should have opportunity to address concerns one-on-one with their supervisor. This feedback mechanism enables open discussion on performance and the plan. There should be consistent feedback throughout the process. However, be sure to focus attention on positive aspects and remember to develop an "action plan" to correct any deficiencies. The majority of performance reviews do not go beyond identifying shortcomings. They do not work with the employee to form a plan of action to remedy the situation.

Evaluating performance is critical, especially if you're measuring it and paying for it.

Paul Dorf is the Managing Director of Compensation Resources, Inc. (CRI). CRI (www.compensationresources.com) specializes in providing comprehensive Compensation and Human Resource consulting services. Dorf is responsible for directing consulting services in all areas of executive compensation, short and long term incentives, sales compensation, performance management programs, and salary admin programs.