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Go to this link with advice about conducting effective performance reviews: http://www.businessmanagementdaily.com/glp/25459/performance-review-examples.html
You can download the entire report, but even the summary (of the 10 tips) will give you plenty of ideas to get started … Report includes examples of employee performance evaluation, writing employee reviews, a sample performance review and employee evaluation forms shows you how to conduct positive, valuable assessments that lead to maximizing staff performance and helping your employees achieve their professional goals and your organization’s objectives.
At the beginning of the year we spent some time brainstorming the strengths and weaknesses of our department, then set goals based on that analysis.