Measure performance and set targets

As your business grows, you may need better ways to measure employee performance and manage staff effectively. Common methods include:

• one-to-one meetings
• team meeting
• staff appraisals
• annual or 360-degree reviews

Use meetings and appraisals effectively

Informal meetings and formal appraisals are practical ways to monitor employee performance and support development. They allow open discussion, help set clear targets and track progress. This can improve productivity and overall business performance. Regular staff meetings also help you stay informed about wider business issues. They can highlight problems or opportunities early, before they escalate.

Use KPIs for employee performance

You can also measure employee performance using key performance indicators (KPIs), especially financial metrics such as:

• sales per employee
• contribution per employee
• profit per employee

These metrics support, but do not replace, formal appraisals. They can highlight issues that need further review.

Apply performance metrics across your business

Measuring employee performance is easier in some roles or industries, such as sales or manufacturing, where outputs are clear. However, most businesses can apply performance metrics. For example, you can use timesheets to track how employees spend their time across projects or customers. This helps you understand productivity and identify the most profitable use of staff time.

Download a sample performance review form (DOC, 23K).