If only there were a measuring stick to define success. Many businesses look at their bottom line and consider that the indication of how well their employees are doing. In reality, that is a meek measure of progress because your bottom line can be due to many factors including economic growth, market demand, and product availability. If you are pleased with your bottom line, there are two questions to ask yourself: Why are we doing well, and how could we do better? The answer to the second question always involves the people who work for you, and tracking their performance helps you, your bottom line, and them. In any business, your people are your most important commodity. Investing in them is investing in your future.

It’s important not to confuse tracking employee progress with micromanaging or looking for mistakes. On the contrary, the idea is create a culture where people have challenges to achieve and are recognized when they succeed. Too many bosses and business owners have no idea what their employees do all day, and how they function. There are many ways to track employee progress. You can use one or many of the following:

• Individualized bench marks: It is important to have company and department goals, but also to have individuals ones based on your employees’ strengths and weaknesses. It is a good idea to ask all your managers or employees to develop up to five clear goals for themselves and their departments every year. This can be done at any time. The more specific, the better. In other words, “Doing better with customers” isn’t a goal. They have to be specific in what that means by saying something like, “taking more time to chat with the customers and build a relationship with each of them.”

Once your employee has developed a goal it is your job to check in with them at least quarterly to ask them to self evaluate, and to provide your insight into how they are progressing.

• Performance evaluations: The chaos of business often pushes employee evaluations to the bottom of the pile. Also, if there is no money available for raises or bonuses, some managers feel it is opening a can of worms to give an evaluation. Remember that the number one motivator in America today is not money; it’s appreciation. If employees don’t know how they are doing, and don’t feel acknowledged for their work, what will motivate them to continue doing well? Evaluations with concrete feedback and clear goals is critical. The way you give an evaluation, however, is the key. It can demoralize if done poorly. The next column will guide you on giving excellent employee evaluations.

• Coaching: Most people think you have to hire an expert for coaching, but actually the best way to coach is internally. The purpose of coaching can be to correct a behavior, but it can also be used to mentor. It also does not have to be from a manager to an employee. Peers can coach each other as well. The idea is to meet on a regular basis (bi-weekly, monthly or quarterly) to check in on established goals. It can be an informal process, but it works for two reasons. First, it helps individuals grow, and second it enables the coach to track progress. If you manage many people, it’s impossible to do this with all of them at once, but you can rotate, so that you are always coaching someone on your team. The third article in this series will give you more tips on coaching.

Knowing what is really happening in your organization means taking an active interest in the people who work for you, and in their professional growth. Accountability begins with a understanding of the jobs people do, and an investment in the goals they set for themselves.