When negative feedback is necessary, the best time to give it is now before the problem gets any worse. Early attention to developing problems lets you turn the painful experience of negative feedback into the more constructive process of corrective feedback. Use corrective feedback not only to stop unacceptable behavior but also to get the employee on the track to better performance.
As with positive feedback, don't always wait for a formal performance appraisal interview. When you see the need, offer feedback as soon as you can. It's never difficult to find something positive to say to the good or above average performer. It's a lot harder to find something positive to say to the employee whose work is substandard. Certainly, you can't give a substandard performer the idea that his or her work is fully satisfactory. Corrective feedback is neither easy or pleasant. You can make it easier and more effective, though, by using this format during the interview.
1. State the context. Use an I-statement that lets the employee know that you are concerned ? and why.
2. Acknowledge the employee's effort. If the employee has been working hard to meet a standard, acknowledge the effort. Look for some specific behavior you can cite to show that the employee can definitely meet the goal.
3. Describe the behavior that has you concerned. As with the rest of the appraisal interview, give specific instances of the employee's behavior.
4. Describe the effect of that behavior. Make the employee aware of the consequences. Heighten the employee's sense of responsibility.
5. State the standard. The employee needs a clear picture of what you expect. Even if the standard has been set earlier, restate it again
6. Ask for reasons and explanations. Be careful not to phrase this as a "Why haven't you...?" type of challenge. Give the employee a chance to describe why he or she did as they did.
7. Ask the employee to suggest solutions. Be ready, though, to suggest your own if the employee doesn't offer an acceptable response.
8. Decide together on a plan of action.
Ref: Alexander Hamilton Institute