A better way to give employees feedback & rewards.
By Laurie Sorrenson, OD, FAAO
Jan. 3, 2024
In the world of optometry, as in any field, the question of how to evaluate and provide raises to staff is a perennial concern. Over the years, I’ve encountered various methods, from the traditional annual review, to the more nuanced, humane and fairer approach that we now use in our practice.
What’s Wrong with Traditional Annual Reviews?
Early in my career, I adhered to the corporate standard of the annual review, a time-honored tradition that, upon reflection, seemed more like a ritualistic exercise than a meaningful evaluation. It involved forms, self-evaluations and the occasional input from colleagues.
Little did I know, this process, as outlined in Alfie Kohn’s “Punished by Rewards” and Daniel Pink’s “Drive,” can be inherently demotivating. Instead, they recommend ongoing evaluation and feedback for each employee instead of waiting for an annual performance review.
These authors argue that tying performance discussions solely to financial rewards can inadvertently stifle creativity and intrinsic motivation. It became clear to me that the once-a-year performance appraisal was not fostering the positive office culture and staff engagement we desired. It also became clear to me that how much each person was making didn’t always reflect their value in the practice.
A Better Way to Provide Feedback to Employees
About six years ago, we decided to break free from this conventional model and embrace a more continuous, holistic approach to evaluating and rewarding our team. Our journey toward a fairer, more transparent system begins at our quarterly leadership meetings (done off site at my house). Sitting down with my chief operating officer (office manager), my son (who is also my partner), and my husband, we embarked on a process that I believe is a better and more equitable approach.
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The cornerstone of our approach is quarterly pay reviews for every team member, instead of reserving these discussions for the employee’s yearly anniversary. At our quarterly off-site meetings we evaluate each employee’s current compensation, compensation history, the time since their last raise, the amount and where they stand relative to their colleagues. We keep this all on a Google spreadsheet.
This allows us to make informed decisions based on merit and contribution to the practice rather than arbitrary timelines. It also means that if this quarter we are not happy with something the employee did or is doing, we can set up an action plan to fix it, and they could possibly be eligible for a raise in three months time if successful, instead of waiting a whole year to evaluate!
What we’ve discovered is a more objective approach. Employees are no longer tethered to the uncertainty of an annual review and unsure of whether their hard work will be reflected in their paycheck, which studies show can be demotivating and reduce staff engagement.
The shift from an annual review to a quarterly evaluation model has not only resulted in a fairer pay scale, but we have also noticed how much more grateful an employee is for a raise when they were not expecting it. When raises are tied to an annual evaluation, it is expected and can be just as likely to create disappointment versus appreciation. Now when employees receive a raise, they usually feel a genuine acknowledgment of their contributions, and also feel grateful for the unexpected raise.
Fairer & More Meaningful for Employees
In conclusion, our shift to quarterly pay reviews has helped us become fairer in how we compensate, but it is also a great time to discuss what each employee needs to do to be able to get their next raise, such as certification, learning something new, promptness, efficiency, etc. This helps us counsel and coach our employees better.
This paradigm shift improved our office culture and created more engaged employees. I believe our pay scale is much fairer across the board than it was before, which makes me feel good as an employer.