Is It Time for Performance Reviews?
Use These Two Tools to Optimize and Focus Your Performance Review Process
Key Results Areas (KRAs) are particular areas of responsibility and focus tailored to a certain role. In addition, there are concrete measures assigned to each KRA. For example, if a salesperson is responsible for growing the revenue of a product line 10% per year, the objective is quite straightforward and specific. If Role Descriptions are created correctly, the KRAs can serve as a comprehensive and practical roadmap for success. Rating this as a primary focus within a quarterly or bi-annual review should be very meaningful and effective.
Example for a Sales Manager
KRA: Revenue Growth
Measure: Achieve a quarterly sales target of $500,000 in new business revenue.
Measure: Increase year-over-year sales by 15% in the assigned region.
KRA: Customer Acquisition
Measure: Onboard 20 new clients per quarter with a minimum contract value of $10,000 each.
Measure: Maintain a lead-to-close conversion rate of at least 25%.
KRA: Team Performance
Measure: Ensure 90% of the sales team meets or exceeds individual sales quotas monthly.
Measure: Conduct 12 training sessions annually to improve team closing techniques, with 80% attendance.
Developmental Goals are focus areas for skills training, attitude, and better utilization of talents. We believe that if employees are not growing in their roles, they are likely to be ineffective and unhappy. As a manager, you cannot motivate employees. Either they are motivated or not, as defined by their role. While still achieving organizational objectives, you can certainly change their role if they are not satisfied. However, until you see that they are not meeting their own three to four Developmental Goals, you will not be able to accurately measure their motivation and ability to learn and succeed within a position.
Example for a Sales Manager
Improve Sales Forecasting Accuracy
Goal: Increase the accuracy of monthly sales forecasts to within 5% of actual sales by Q2 2026.
Measure: Track forecast variance monthly using CRM tools, aiming to reduce discrepancies by analyzing historical data and market trends.
Purpose: Enhances strategic planning and resource allocation, ensuring better alignment with company revenue targets.
Enhance Leadership and Coaching Skills
Goal: Complete a certified sales leadership training program and conduct bi-weekly one-on-one coaching sessions with each team member by the end of 2025.
Measure: Achieve a 10% improvement in team sales performance metrics and a 15% increase in team engagement survey scores by year-end.
Purpose: Strengthens team motivation and performance, fostering a culture of continuous improvement.
Expand Strategic Account Management
Goal: Develop and implement a strategic account management plan for the top 10 clients, increasing their annual revenue contribution by 20% by June 2026.
Measure: Track client revenue growth and satisfaction scores (targeting 4.5/5 in client feedback surveys).
Purpose: Builds stronger client relationships and drives long-term revenue growth.
Adopt Advanced Sales Technologies
Goal: Master the use of a new CRM analytics tool to improve lead scoring and pipeline management, achieving a 15% increase in lead-to-close conversion rates by Q3 2026.
Measure: Complete tool-specific training within 3 months and monitor conversion rates quarterly.
Purpose: Leverages technology to optimize sales processes and improve efficiency.
You can use a five-point rating scale to rate each of the items above.
Why Defining and Measuring Only KRAs and Developmental Goals Can Be Effective
Reviewing and measuring too many areas of performance can confuse employees because it dilutes the focus on the areas that are truly important for achieving success within a role. This forces management to be very knowledgeable and clear about their expectations for each role within an organization, which we believe is more effective than casting a wide net of cookie-cutter expectations that leave employees feeling disconnected and unable to achieve success.
Focusing on the important 20% can increase productivity and chances for success by 80%. If you are familiar with the Kolbe Wisdom™ assessments that we have used for many years, you know that success is achieved when employees have the freedom to be themselves. As an employer, if you know each job well, you can match the right people to each role. By focusing solely on success indicators and development, employees should be able to take ownership and operate autonomously within their roles to achieve results. If not, either the job is misaligned with the employee—which we can measure scientifically—or the employee simply is not motivated, regardless of the emotional barriers they choose to create. Being narrowly focused on what matters most will help diagnose such performance issues very quickly.
This simplified approach offers very little room for excuses. Either the employee is achieving the bare essentials for success, or they aren’t. Performance planning sessions can evolve into very simple and direct conversations, without ambiguous definitions of terms and measures that are, frankly, mostly meaningless without clear goals for success.
Reviews can be completed in less time and therefore occur more frequently. With this approach, quarterly reviews that last one hour will be more effective than a single, long review dialog every six to twelve months. Managers will be more open to the process, knowing it is straightforward and concise. While you may need to train managers on how to have more candid and compelling conversations with employees during review time, that is a valuable time spent learning a method (such as T.A.L.K., which we use) that can be applied anytime throughout the year.
Share Your Experience
Have you tried this simple approach to performance reviews? What was your experience? How has it transformed your organization?