Performance appraisals represent a significant opportunity for supervisors to build a mutual commitment with employees — which is a key engagement driver — but more often than not, this opportunity is wasted. That's because performance appraisals tend to focus on trailing feedback rather than leading feedback. In other words, managers don't spend nearly enough time on the developmental side of the meeting.

A simple way to trigger this shift is to change your terminology. In other words, don't call them “performance appraisals”; call them “employee development plans” (EDPs for short). The purpose of an EDP is to motivate and guide employees to perform at the highest levels and to focus on employees’ professional growth.

Yes, EDPs should include a summary of accomplishments against prior goals, but the idea is to move away from a report card, instead supplying a road map for continuous development. By explicitly linking the employee goals to the company's strategic priorities, the plan reinforces the line of sight and acts as a natural extension of the firm's balanced scorecard.

A successful EDP fosters an open yet formal discussion of successes and shortfalls, as well as the factors that should be taken into consideration when cultivating a particular individual — that is, the individual's passions, training and development, family situation, immediate and long-term career goals, and so on.

When done well, EDPs enable managers to spend as much (if not more) time discussing future goals and developmental action as reviewing performance. The result? Improved engagement!

The bottom line? The importance of input, coaching, and development is critical to an employee's level of engagement.

Indeed, in their research on engagement, Dale Carnegie found that engagement levels are higher among employees whose managers give them feedback and encouragement to do their jobs better, who learn a lot from their managers, and who have opportunities to grow the skills in the organization. The EDP is a key part of that.