The first step in creating aneffective employee evaluationis to first determine why you want to evaluate your employees. 

These reasons may be to determine grounds for changes in compensation or position within the company, as a way to determine if the employee in training is progressing properly, to determine if an employee needs to be terminated, or as a function of personnel research. Knowing the reason for the evaluation is important because each purpose has a different set of objectives and tools. 

For example if the evaluation is intended to be used to determine if an employee deserves a raise in pay, then elements like job proficiency, productivity, and customer satisfaction may all be used to determine whether or not a raise is warranted. In this case objective and measurable qualities and behaviors need to be measured, and subjective qualities like the personability the employee should be omitted as they may not accurately describe a quality that impacts the employee’s work.

During the training and probationary periods, evaluations are also needed to determine if the employee is learning the job fast enough and with enough proficiency that their continued employment will be either an asset or liability for the company. If the evaluation is improperly formatted, or if it uses tools that do not objectively measure factors that will predict future performance, then an improper employment decision may be made. As a result of this mistake, a potentially great employee could be terminated, or a below average or combatant employee may be retained.

Personnel research is another reason why companies evaluate their employees. In this instance the evaluation will be measuring a specific issue such as the effect that a time saving tool has had on productivity, or to determine the overall job satisfaction rate within the company. In order to determine these things specific tools will need to be used that address and measure specific qualities, behaviors, and results.

For example if personnel wanted to evaluate job satisfaction they would probably send out a questionnaire that asked questions pertaining to issues related to job satisfaction like if they feel that their supervisor listens to them, if they feel that their supervisor seems to make fair decisions, and if they feel that their presence within the company is appreciated. 

If the wrong tool is used for an evaluation then the wrong elements and issues will be measured and the information gained from the evaluation will be useless. For example if we look at the job satisfaction scenario again and instead of sending out a questionnaire that addresses issues that directly relate to job satisfaction, and instead it asks questions pertaining to their feelings about possible changes in shift schedules, then the wrong information will be evaluated. While a change in shift schedules may impact future job satisfaction, it does not reflect CURRENT job satisfaction and therefore it is not a proper focus for a feedback survey intended to measure current job satisfaction rates.