Dive Brief:
- Companies that communicate clearly defined performance criteria are better able to provide clear employee expectations, improve engagement, up productivity, give fairer evaluations and reinforce organizational culture, according to new research from HR research and advisory firm McLean & Co.
- McLean’s latest report found that employees who understand their job expectations were 8.6 times more likely to be engaged in their work. Nonetheless, many companies “struggle to define criteria that reflect today’s work realities and support fair, effective talent decisions,” per the report.
- The research cited data from McLean’s HR Trends Survey 2025, which found that organizations that didn’t provide positive employee experiences saw voluntary turnover rates that were 40% higher than those who did. Meanwhile, the HR Trends Survey 2026 found that employees in these organizations were 1.27 times more likely to say they had higher stress levels.
Dive Insight:
The new research found that when performance criteria was not clearly defined, it undermined the overall employee experience, lowering trust and upping employee stress. Yet despite organizational efforts to update performance management criteria, McLean said that many organizations still used overly generic and complex criteria or relied on criteria that didn’t align with how employees actually accomplished their tasks.
“Performance criteria should aim to make success clearer, not more complicated,” Leann Schneider, director of HR research and advisory services at McLean & Company, said in a statement. “HR leaders need to define expectations that reflect both outcomes and behaviors, keep the number of criteria focused, and ensure employees can see how their work connects to broader organizational goals.”
HR respondents who said their department’s effectiveness in performance management was high were 4.7 times more likely to report having an “effective” employee engagement strategy, McLean said, citing data from its HR Management and Governance Survey.
Meanwhile, the latest research found that when performance criteria wasn’t on point, it hurt trust, created confusion and made it more difficult for companies to evaluate employees in a way that felt “fair, focused and credible.”
In order to create a better performance criteria, McLean suggested that HR leaders focus on organizational context and operational realities when evaluating employees. The report also suggested using tailored assessments that consider specific goals, expectations, skills and company values. Finally, McLean said it was important to weigh criteria and determine what mattered most, while also ensuring that managers had the tools to explain any changes, address potential resistance and process employee feedback.
“When criteria are grounded in role realities and reinforced through communication, feedback, and coaching, organizations are better positioned to support employee growth and make performance management more effective,” Justine Czencz, manager of HR research and advisory services at McLean, said in a statement.
A recent study by Cornell University researchers found that employees preferred narrative-only feedback and considered it the fairest form of performance evaluation. That report said that providing narrative-only feedback also gave employees a better understanding of how to improve their performance.