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Neil Amato
Neil Amato

Scheduled maintenance for your employees

Six tips for firms to encourage clear goals and then monitor progress.

January 24, 2013
By Neil Amato

Think of performance reviews the way you’d think about an oil change. Your car will run without on-time maintenance, but it will be most efficient with TLC. Employees, a company’s most valuable asset, also need regular attention. Edward Mendlowitz, CPA, a partner with WithumSmith+Brown, offers reminders for how firms can encourage staffers to set clear goals and then measure progress.

First, set quality goals. Mendlowitz doesn’t want an employee to set more than two goals per year. Too many goals can clutter the process. “I think the evaluation process is getting people to commit to their goals,” he said. “If everybody would pick one goal and achieve it, it would be great. The problem is everybody picks 10 or 15 goals, and they don’t achieve any. If someone picks one goal a year, in the end of 10 years, they’ve achieved 10 things.”

Stress that employees devote appropriate attention to clients. “I think it’s important to be at the client’s place of business as much as possible,” Mendlowitz said. “Any work that can be done there should be done there. Let the client see you.” On the other hand, Mendlowitz said, the staffer shouldn’t be so visible and inquisitive that the client can’t get any work done.

Check in regularly, adjust if necessary. Mendlowitz believes performance reviews should occur more regularly than the customary annual meeting. He advocates a quarterly review of goals and regular follow-ups after each quarterly review. Lee Iacocca, known mainly for his work as the CEO of Chrysler, wrote about such regular check-ins in his autobiography. “He used to meet every three months with everybody that reported to him. He would measure their success and their progress by what they said their goals were. If the goals aren’t in line, you adjust them,” Mendlowitz said.

Make sure employees follow directions. This goes beyond rules for conduct, attire, and promptness. Let’s say an employee has been assigned to an audit and is asked by a supervisor to provide weekly progress reports. “If I have to chase after them and find out where they stand, that’s bad,” Mendlowitz said. “That’s one easy way I evaluate people.”

Track employee contributions to innovation and culture. The employee who came up with a dashboard format to present key performance indicators (KPIs) to a client is getting higher marks than the one who sits quietly in meetings. Mendlowitz also used an example of an employee who created Munchkin Friday by bringing in Dunkin’ Donuts and having people stop by his office. “That is something that contributes to firm culture, and it establishes a personal brand,” Mendlowitz said. Also, employees should be told that these types of contributions are being measured.

Measure employee contribution to the bottom line. Realization rate is one obvious measure. But employees also can be judged on their support of growth. “Does the person work on a client where the fees go up on a regular basis, or does the person work on a client that engages us for additional services?” Mendlowitz asked.

“Some people can have good realization but not that much growth.” The behaviors of those employees with high realization as well as solid growth should be copied. “You have to pick out the traits of people who are doing well, try to bottle it, and pass it on to other people,” Mendlowitz said.

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Neil Amato is a Journal of Accountancy senior editor.