Righter Performance Appraisal

Posted on October 9, 2006 by John Hunter

Speaking of “doing the wrong things righter” Microsoft has eliminated forced rankings in performance appraisal: to do performance appraisals righter.

Microsoft exec puts her stamp on human resources:

The forced curve was company policy. And it climbed up a list of employee gripes that grew as Microsoft’s stock, which accounts for much of the company’s compensation, languished.

In May, after barely a year as Microsoft’s human-resources chief, Lisa Brummel swept away “artifacts of the past,” starting with the widely disliked forced curve.

Good (see mini-Microsoft and our previous related post: Performance Without Appraisal), but the rest of the artifacts of the present should also be swept away.

Related: Failed Practice: Forced Ranking – New Rules for Management? No! – Performance Appraisal Problems – Deming on Performance Appraisals – Problems Caused by Performance Appraisal

“The performance-management system tells you what it is in this company that we value and reward,” said Herman Aguinis, a professor of management at the University of Colorado at Denver Business School, and author of a recent book on the topic. “If you’re changing the things that you value and reward, people are going to change their behaviors accordingly, so it is a very powerful tool to change a company’s culture.”

True, so tell your people you value them for how there performance evaluation looks each year (not for them but the disembodied evaluation)? This is similar to Seth Godin’s post where he talks about hiring people based on good interviewing skills versus what is actually needed to do the job. This in not to say performance need not be managed, managers should be managing the people that work for them and the systems within the organization. The performance appraisal is just the wrong method.


There are no easy answers, but what it should be about is managing the system to produce the best results. As I have said before Peter Scholtes does the best job of explaining how to achieve the best performance (which is without appraisal). My best advice is to read chapter 9 of The Leader’s Handbook and read the rest of the Leader’s Handbook and other great management improvement books.

Two more books on managing people: Abolishing Performance Appraisals: Why They Backfire and What to Do Instead by Tom Coens, Mary Jenkins and forward by Peter Block – Peopleware: Productive Projects and Teams by Tom DeMarco and Timothy Lister.

Just because it would be nice for performance appraisal to work doesn’t mean it does work. As Deming said some numbers are unknown and unknowable and the wish that it is possible to quantify the contributions of people doesn’t mean you can. People cling to the idea that performance appraisal is the only tool we have to manage performance so we must use it. Even if most people realize it is just a game that accomplishes little, if anything positive, and causes great frustration and animosity they persist. Hopefully performance appraisal will be seen as “artifact of the past” sometime soon.

I don’t think the answers in this area are easy. But the best argument people make for performance appraisals is not what great value they provide but that without them chaos would rein. This isn’t so. Read what Peter Scholtes and others say. And you can help move to making performance appraisal an “artifact of the past.” I used to believe performance appraisal was a good tool (not perfect but fine) and have learned they are just the wrong tool.

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