Performance evaluations are a necessary part of every company’s HR function. They are not only a reflection of an employee’s performance, but also an effective tool to recognize good performers and hold underperforming employees accountable.

A performance evaluation is a perfect opportunity to address the company’s needs, set goals, motivate employees, and ensure the company has a productive year. This article will walk through six critical steps to developing and delivering an effective performance evaluation.

Step 1: Document, Document, Document

Failing to document employee issues throughout the year is one of the biggest mistakes managers can make. Without proper documentation, the manager has to write a performance evaluation from memory, which may affect its accuracy. Moreover, failing to address mistakes as they occur inevitably leads to missed opportunities to address key performance issues before the annual review.

Proper documentation and consistent communication ensures that nothing discussed during an evaluation is being addressed for the first time. Accordingly, the employee will perceive the evaluation as a fair summary of his or her performance.

Documentation does not need to be an arduous or formal task, and it’s never too late to start. The manager can draft e-mails, write informal notes, or create a personnel log rather than issuing formal notices for each accomplishment or failure of the employee’s performance, as long as it’s consistent.