Free consult & free copy of book

E-Myth – “Why most small businesses don’t work & what to do about it”

Contact Us


Most 5 star CPA Google reviews in Canada

Read Reviews

Chartered Professional Accountants E Myth

1 Fixed Monthly Fee - Planning | Accounting | Taxes | Consulting

Helping Canadian businesses beat the odds!

Edmonton Business Consultant Employers Should Ditch The Annual Review

Entrepreneurs often have preconceived notions about their employees when they open their own business says Edmonton business consultant. They often believe that keeping people is more beneficial than replacing them, and that an important tool to that end are utilizing annual reviews. However, business owners need to understand, that while losing staff can be expensive to a business, it is also inevitable, and business owners should work in their business to minimize the effects that bringing on a new employee has to the business. Also, business owners should understand that annual reviews are not an effective way to reduce attrition in their business.

Entrepreneurs often conduct annual reviews because that is what they know, and that is all there experience says Edmonton business consultant. However, annual route views are often ineffective, because that means that a business owner is waiting an entire year to either address great behaviour that they want to encourage, and by waiting to talk to struggling employees or employees with problematic behaviours, could have caused that employee to develop such issues or problems in the business, that addressing it only once a year could have caused these problems to get out of control.

Business owners should consider an alternative to the annual review as regular and periodic reviews. By working this into the operating schedule of the business, staff members can see it as an expected event and not indicative of any problems. This way both the employer and the employee can have a frank conversation about how things are going and the business owner can use this as a platform to reward good behaviour as soon as they see it happening to encourage it to continue. And it can also address struggles employees might be having, or correct problematic behaviours whenever they are seen as well. Edmonton business consultant says by doing this, is this owner can start to cultivate the type of employee they want to see in their business.

By conducting periodic reviews, and allowing employees to see the type of behaviour that is valued by the company, entrepreneurs are ensuring that they are setting the stage to keep employees that are great, while ensuring they can remove an employee that is not working out early. Edmonton business consultant says that this is very valuable to increase the retention rate, but also help entrepreneurs identify who is not a great fit in their business so that they can eliminate that employee before to do damage to the overall staff base of the business.

By not being afraid to lose the wrong employee, and minimizing the effects that transition has in their business, business owners can work to have the right people in their business, lose the wrong people, and then find the people that are the best fit for their organization. Edmonton business consultant says this is extremely important to ensure the culture of the organization stays intact, and that there allowing the organizationís values this week for themselves.

Many entrepreneurs believe that the Adm. a review is a great way to reward great employees, and correct behaviours of problematic employees says Edmonton business consultant. However, by only doing this once a year can often cause problems for businesses. Entrepreneurs should consider more regular periodic reviews that are less time-intensive, so that they can use them as positive reinforcement to encourage the behaviours they want to see in their staff. They can also use those periodic reviews to correct behaviours that they see as problematic, and to keep an eye on it is that it does not become a problem. However, entrepreneurs need to understand that is much as they want to keep all of the staff that they can, keeping bad staff is far more damaging than the cost of replacing them. Jim Collins, the author of six business books including Good to Great says it best with: ìletting the wrong people hang around is unfair to the right people, as they inevitably find themselves compensating for the inadequacies of the wrong people. Worse, and can drive away the best people. Strong performers are intrinsically motivated by performance, and when they see their efforts impeded by carrying extra weight, they eventually become frustratedî

By utilizing more frequent reviews, Edmonton business consultant says business owners can keep an eye on the staff that may end up being problematic, by at the same time increasing the retention rate of the staff who are exhibiting hard work and great behaviours. However, business owners need to understand that no matter how much they do to increase the retention rate of their great staff, employees will end up leading the organization when the circumstances dictate it is best for them to go. They may get ill, have a change of career, or move, and those circumstances are out of would entrepreneurs control, they need to understand that rather than doing everything in their power to keep all the stuff that they have, they also need to ensure that their business is built in order to minimize the transition time of moving from one employee to the other one it does inevitably happen.

Edmonton business consultant says that entrepreneurs need to understand that the two things that make losing employees expensive are recruiting them and training them. They can do two things in their business to address each of those issues and minimize the effect that transition has in their organization. By ensuring that they have a minimum of two employees that are familiar with any given task in their business, to ensure a business owner will be able to continue to operate their business no matter which employee leaves. This way, a business owner does not need to worry about trying to find someone quickly, and they can take their time in finding the right person for their business. By continually recruiting in their business, entrepreneurs can increase the number of people that they are meeting on a regular basis in order to identify who is a great fit for their business, so that when they have the need to fill a spot, they are ready and able to do so.