We can tell when someone is using flattery to make us feel better. With friends it can be harmless fun, but within a business it can be disastrous.
To lead a growing organization, you must provide honest and helpful feedback. Too often we provide only critical opinions on how we perceive performance or we compensate for negative comments by adding flattery. To be effective, performance reviews need to be honest. They need ton consist of two-way discussion. For an employee to improve in your eyes they need to understand your perspective (or change your perspective). Effective feedback can include examples of behavior, discussion of alternative actions, or revision of goals.
If you are able observe without judging, you will be able to increase your capability for compelling evaluation. It takes practice.
To show you really care about a person, always be open and sincere. This applies to both praise and constructive criticism. This quote from Dale Carnegie puts it into perspective. “The difference between appreciation and flattery? That is simple. One is sincere and the other insincere. One comes from the heart out; the other from the teeth out. One is unselfish; the other selfish. One is universally admired; the other universally condemned.”