The following will help you to address performance gaps with employees during appraisals. 

1. Begin by acknowledging the positive contributions and accomplishments. This will set up a right tone that will make your employee more receptive to your unfavourable feedback to come. Furthermore, it establishes trust between the both of you by showing the employee that you have been fair in your evaluation and is not judging them biasly.

2. Describe the gap between the target goal and the actual performance. For example, the target goal at a call centre could be for an employee to pick up the phone within 3 rings, but the employee only answered the phone after 5 rings. Rather than blaming the employee, work with him to see what could be the root cause. Allow the employee time to provide his input and identify the possible reasons. 

3. Obtain mutual understanding that the employee has to work on closing the performance gap. The reasons for underperformance may not be obvious all the time. It could be lack of skills, personal problems, conflict with colleagues or burnout. Therefore, it is important for the manager to discuss with the employee to unveil the causes and solutions.

4. Frame your questions and statements as a way to achieve the goal so that your employee will not react in a defensive way. 

5. Summarize the discussion. Fix a date to have another conversation on how to move forward. It is best to have a separate meeting as it will allow both parties to have a ‘cooling period’ to think about how to develop an action plan for improvement.