Effectively documenting employee performance. It is sometime boring. It is sometime time-consuming. But it is ALWAYS Important.

But rather than focus exclusively on “how to document performance,” let’s consider why documenting employee performance is so important in the first place. Without carefully considering all the reasons, it’s difficult to gain support within an organization to generate constructive or productive feedback.

The most common purpose for documenting employee job performance is to provide a mechanism for corrective action for those whose work output or conduct do not meet established standards(more about those “standards” in a bit). Focusing solely on what often turns out to be a punitive outcome misses the fundamental purpose of monitoring employee performance in the first place.

Here’s what I mean. Employees are referred to as “human resources” or “human capital” for a reason. Employees are an asset which represents an investment your organization has made in time and money*. Employee retention is critical because, at the end of the day, protecting your investment in your human resources is the most important reason for correctly and appropriately documenting performance.

Let’s get back to the standards I mentioned. Clearly defined job goals and standards are the cornerstone of any effective appraisal process. Employees do not want to be left to their own devices when they start a job. (For those that do, that’s a trip started going in the wrong direction.) Specific job criteria and goals provide new hires as well as incumbent employees with clear, attainable objectives, goals, duties and requirements they can use to evaluate their job performance.

A comprehensive and realistic job description is critical to starting any employment relationship off on the right foot. And by realistic, I mean more than a description which contains job requirements that the worker (based on education, experience, background, training and competencies) can meet. Far too often actual job duties deviate from those included in the initial position description. Evaluating performance in such circumstances becomes difficult because you no longer have documented, measurable standards against which the employee can be measured.

If you are satisfied that the position description suits both your needs and that of your worker, then documenting employee performance becomes much more manageable. However, this is only the first step. Maximizing the effectiveness of employee performance reviews requires that you remember the reasons why you document employee performance.

Here are a few of the most important reasons:

To communicate. Not only with your employee, but with your organization. Workers want to know whether they are doing a good job. Companies need to know that maximum productivity is being achieved. Effectively documenting employee performance is a communication tool that provides the best means to do both.

To Identify. Whether used to identify strengths or weaknesses, detailed employee work appraisals provide the basis for evaluations, wage increases, promotions, corrective actions and/or the need or opportunity for additional training.

To build a performance history. Not every employee stays in the same job, in the same department, working for the same supervisor. Taking care to document his or her performance provides your company the documentary information it needs to make personnel decisions about that employee and plan for that worker’s contributions going forward.

To build a case. In the event your best laid plans go astray and disciplinary action is required, the diligence that’s been exercised in documenting employee performance is often the best defense to any lawsuit or other employment-related claim.

Documenting employee performance is far and away the most effective way to protect the investment in your human resources and to avoid liability if and when the time comes to terminate an employee.

*It’s estimated that the average cost to American employers to replace each employee is approximately $17,000.00. Read more about the cost of employee turnover and the cost to hire.