WHEN BRITAIN'S athletics coach publicly 'named and shamed' individual team members for their disappointing showing at a recent European championships, his words could have no effect on their technical ability. Running faster or jumping further is a matter of physical conditioning that takes months of training, diet and practice. Instead, he obviously believed he could affect their attitude - that he could improve their performance by motivating them to try harder. He was doing - or trying to do - performance management.
Performance management is one of those many management issues (leadership is another) that becomes more puzzling the more you look at it. At first sight it seems evident that teams and individuals should be managed to produce good performance. But that doesn't make it effective or easy. A recent report by the Work Foundation notes that despite intensive attention from academics and practitioners over the last two decades, for many organisations performance management remains a vexed subject with a 'grail-type quality' always out of reach.
Difficulties organisations (not just companies) wrestle with include: schemes that are poorly designed and administered over-complexity focus on the individual rather than teams (despite rhetoric to the contrary) failure to put development promises into practice lack of line-management commitment a wrong emphasis on financial rewards inconsistent and subjective appraisal simplistic assumptions about identity of interest ('we're all in the same boat') and poor returns for the effort involved. Oh yes, and both managers and employees hate it.
Taking these objections into account, there's a fair chance that performance management often ends up destroying value rather than creating it. (Ask yourself what good the public haranguing of the underperforming athletes will do.) When a 'solution' raises more questions than it answers, and the only help on offer is the exhortation to do it better, it's generally nature's way of saying that there's something wrong with the original premise. Performance, along with stress, absenteeism, culture, appraisal and many more elements in the bloated management superstructure comes in the category of problems best treated not by managing them better but by eliminating the need for treating them altogether.
Performance management is perfectly symbolised by appraisal, a central part of PM, in which managers 'give feedback' to the employee. This defines it as a manager-facing system: in a customer-facing system it's the customer who feeds back information to the supplier so that the collective function can be approved.
If the employee 'has his face towards the CEO and his ass towards the customer', in Jack Welch's immortal phrase, it's not surprising that the overall results are erratic and disappointing. Performance management too often consists of trying to make people do the wrong thing righter - a dead end which offers no useful learning.
In any case, the importance of individuals and even teams is vastly overestimated compared with the constraints under which they operate. The assumption behind PM that improvement is chiefly a matter of individual effort, motivation and capability is deeply flawed. In their excellent Hard Facts, Dangerous Half-Truths and Total Nonsense , Jeff Pfeffer and Robert Sutton show time and time again how systems trump individual effort: people do perform differently - but it's not the same people who do better or worse each week bad systems full of brilliant people make terrible mistakes however heavy the performance management (for instance, the repeated Nasa tragedies of Columbia and Challenger) good systems make ordinary people perform better. 'Bad systems do far more damage than bad people, and a bad system can make a genius look like an idiot. Try redesigning systems and jobs before you decide that a person is "crappy",' they advise.
As this suggests, the best solution to the PM conundrum is to design it out. This means creating a system in which employees face, and get feedback from, the customer, and requires a crucial shift in perspective, from managers controlling people, to managers and workforce together learning to control the system. A good example would be a customer contact centre where individual activity measures (how many calls, how long they take) are replaced by measures related to purpose (how long did it take to resolve the problem from end to end). The management of performance then becomes a process of learning - what are the most common problems, how can we resolve them more quickly, and even better, how can we prevent them arising in the first place? The job manages performance of the manager too, and most of the bureaucracy of 'performance management' is redundant. As the psychologist Abraham Maslow once said, 'What is not worth doing is not worth doing well' - just don't do it.
The Observer, 27 August 2006