As a business owner, you need to understand the importance of measuring employee performance. This is an often-overlooked responsibility of management that can have a negative impact if ignored, or a positive result if embraced and used. This variable alone, when appropriately managed, can help you take your business to the next level.

How to Measure Employee Performance

Measuring employee performance is a management evaluation of the work being done by an employee. Using software, metrics can be gathered and job positions can be evaluated for efficiency. This is a critical time to determine if the employee has experienced growth, reached goals and is developing into a greater asset for the company. Not all evaluations are based on metrics; some employees may not perform as well as others but may have personality traits that make up for their lack of physical output. These are traits that need to be considered during a performance evaluation.

Understanding How to Value a Position

Performance evaluations are necessary for growth. Every position is like a puzzle piece that fits the bigger picture, and if one of those pieces is missing or not in the right place, the whole picture is compromised. Management understands this and can evaluate performance as such, identify issues and adjust accordingly. There are positions like sales and customer service that may rely more heavily on personality traits than metrics. However, metrics like sales goals and customer support goals also need to be met. Knowing which positions require performance, which positions rely on attitude and personality and which jobs are a combination of the two will allow you to assess performance more accurately.

Setting Reasonable Goals for Employees

If you are going to measure performance, there needs to be a goal in place. Creating unrealistic expectations for employees isn’t going to accomplish much for either of you. Setting achievable goals that can be measured gives employees a target objective that should result in a reward and improve the workplace environment. Setting and reaching goals that improve company performance should be rewarded during the evaluation process. Management needs to be aware that not everyone is going to achieve the goals set out for them, there may be unique situations that will need to be considered for each individual within the company.

Track and Record Performance

Not all positions can easily be measured for performance, but sales and customer service are two exceptions. Sales stand out as a more prominent position. If sales are down, profits are down and it’s usually easy to determine who is performing and who isn’t. With customer service, employees are often tracked by the number of calls they take in a day and whether or not the customer’s needs were met. This evaluation is also recorded in customer surveys. Tracking and recording employees can be done using performance management software like There are desktop and mobile versions of these applications that can help businesses collect the data needed for measuring employee performance. 

Which Evaluation Software Should You Use

Every business has different needs and different goals to track. Researching the various types of available software is the first step one should take. Open source platforms can be modified to meet your specific needs. However, you will need a developer and an excellent understanding of what you need to make that work for you. Most online options offer the tools you need to collect the data and adequately evaluate an employee’s performance.


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