How to set up an HR cycle

If you want to stay on top of what is going on with your employees, you can apply an HR cycle in your company. This helps you reduce the chances of employees leaving unexpectedly and long-term absenteeism. Many companies apply the traditional HR cycle or the modern HR cycle. Some companies develop their own HR cycle. Here is how to set up an HR cycle that suits your company.

Verplichtingen en meer als werkgever

The KVK Staff Adviser tool tells you what HR matters you need to arrange and recommends other HR measures.   

Start the tool

An HR cycle, also known as the HR interview cycle, is all the moments in a year when you have a scheduled conversation with your employees. The traditional HR cycle consists of 3 scheduled conversations per year. Companies using the modern HR cycle usually engage with employees more frequently. The cycle starts on the employee's first working day. 

Purpose of the HR cycle 

The purpose of the HR cycle is for you to support your employees in their performance and development so that they are satisfied with their work and can contribute to the success of your organisation. To provide this support, you talk regularly with your employee. Put open communication and development at the heart of these conversations. 

An HR cycle is an important part of your HR policy because it focuses on your employee's organisational goals, cooperation, and development. This way, you know what is going on with your employee and can act accordingly. If, for example, your employee is not functioning as expected, you can discuss why. Then, together, you look for solutions for your company and your employee. Perhaps your employee needs more guidance, or would rather fulfil a different role within your company. You will discover this by having regular and open discussions. 

Regular conversations show that you are there for your employees. Employees feel heard and this can motivate them in their work. Barbara Bolle, psychologist at Psychologenpraktijk Perspectief, says, "My experience is, if your boss listens to you, then you also want to go that extra mile for your boss." 

The traditional HR cycle 

The traditional HR cycle is often applied in companies and consists of 3 conversations. The planning conversation at the beginning of the year, the performance conversation mid-year, and the appraisal conversation at the end of the year. Each of these 3 conversations takes place once a year. 

The planning interview 

During the planning interview, you discuss with your employee the plans and goals for that year. The idea is for the employee to bring in their own goals and for a conversation to take place. The employee's goals combined with the company goals will make up the objectives for that year. Put everything that is discussed in writing and share it with the employee after the conversation. This way, the employee can check the agreements made at any time. 

The performance interview

In a performance interview, also called a progress interview, you and your employee look back on the first half of the year. The following questions are central during the conversation: 'How are the goals set during the planning interview coming along?' and 'Can I as an employer help you to achieve these goals?' So the conversation is not only focused on the employee's performance within your company but also on the cooperation with you as manager. Ask your employee to provide points to discuss and prepare well for the interview. Then record the conversation and the agreements made during it in the personnel file. 

The appraisal interview 

During the appraisal interview, you discuss whether your employee has achieved their set goals. Before the interview takes place, the employee’s manager fills in an assessment form. This assessment form lists the topics the employee will be assessed on, such as cooperation, results, or development. This form guides the interview. To gather more information about your employee's performance, you can also ask other colleagues to fill in the assessment form. 

The appraisal interview is from your point of view. As an employer you assess the employee, and not the other way around. Give your employee space to ask questions during the conversation. At the end of the interview, there will be an overall assessment, which may include a reward. If they perform well, you can give your employee a pay rise, for instance. 

Ask your employee to sign the assessment form after the interview and then sign it yourself. Keep the signed appraisal form in your employee's personnel file. 

The modern HR cycle 

Some companies find the traditional HR cycle outdated and prefer 'the new-look appraisal'. The reason for modernisation is that they believe the focus on goals and performance is out of date. 

The modern HR cycle is about the employee's ambitions and needs. You also look at what the employee is good at and how to use these talents even better at work. There is more emphasis on the future than assessing past performance. Devise short-term goals together, for example, quarterly goals. Together, you are responsible for these goals. Conversations with your employee thus become positive and motivating. 

In the modern cycle, you move away from the fixed schedule of 3 conversations per year and keep talking to your employee throughout the year to discuss how things are going. As with the traditional HR cycle, it is still important to document in writing what you have discussed with your employee. 

Choosing an HR cycle 

Choosing a traditional or modern HR cycle depends on your business type and goals. This means an appropriate interview cycle varies from company to company. You can also develop your own HR cycle. The following steps will help you get started: 

1. Mission and vision of your company  

Take your company's mission and vision as a starting point. What does your company stand for? How should you work together and how do you give feedback? Does a modern or a traditional interview cycle suit the company better? 

2. Involve your employees 

Draw up the HR cycle together with some or all of your employees, so that everyone agrees. This prevents resistance and also provides valuable insights for the HR cycle. You can do this by holding several brainstorming sessions, in which everyone can give input. Make sure that for each session you have a clearer idea of what the final HR cycle will look like.  

3. Test and evaluate the new HR cycle 

Once you have drawn up the HR cycle together with your employees, it is time to test it in practice. Ask your employees for their opinions after the test period and then adjust the HR cycle where necessary. 

It is important to keep testing and improving the HR cycle. This way, you ensure that you keep having conversations in the right way within the company. So repeat the above steps regularly.