Prior to 1960, the "performance appraisal" as a tool for management was rarely utilized. Only a few of the world's largest and most sophisticated corporations utilized a regular process of appraisal, and even then the process rated or evaluated the person, not the performance. In 1954, Peter Drucker outlined a process he called "management by objectives and self-control," and the concept of goal setting was born. Through the '60s and into the present, the management by objectives concept described by Drucker became the "Management by Objectives Program." Unfortunately, the power of the concept of "self-control" was lost as the variety of systems bogged down in bureaucratic methods and procedures. MBO all too often became a paper-work mill.
In addition to MBO, a parade of techniques swept the personnel field during the following two decades, as the appraisal process shifted from focusing on preset criteria and required behaviors (such as attendance, attitude, cooperation, etc.) to traits (such as initiative, motivation, skill) and then to methods and behavior. Virtually all the techniques originated in the personnel office and were viewed as "personnel" programs. Often they included an attempt at "goal setting." The goals, however, were determined by the manager's evaluation and needs. Most had to do with changing the person or generated lists of activities that were called goals. The concept of a "goal" has long been misunderstood as "goal setting" and is usually nothing more than activity planning. Goals don't change - methods do. Once we began managing activities, we became enslaved by them and bureaucracy grew unchecked.The prevailing orientation of management as taught in the business schools during the period was the familiar POSCD model (planning, organizing, staff, controlling, directing). The emphasis was on the employee as a tool of production.
While deserving of courteous and tactful (human relations) treatment, the employee was, in the final analysis, little more than a tool for production, and he or she was paid "a fair day's wage for a fair day's work" and evaluation was limited to judging compliance with standards often developed by time and motion studies.
In the mid-'70s, the favored leadership or communications style more emphasized sensitivity toward others. A powerful force to move away form the theoretical negative "Theory X" toward the more optimistic "Theory Y" swept the nation. "Positive reinforcement" became popular, and the appraisal process began to move away from evaluating results toward rewarding supportive and nurturing the behavior.
At the same time, more and more purposes for the process were added as the appraisal system began to encompass merit and salary decisions, promotion decisions, identification of potential, diagnosis of skill for planning training and development activities, and even identifying interest in foreign assignments. One of the things the experts learned from this experience was, as Norman Meier said, "The more purposes you add, the more you screw up the data."
Through the '80s, a more helpful paradigm began to emerge. One built upon valuing the contribution of each individual toward the vitality and survival of the enterprise was emerging. Some writers have called this movement the age of employee involvement and participation, others the era of empowerment and intra or entrepreneurial leadership.
Some have focused on the concept of socio-technical design and of self-management and self-control. Roots were found in what became known as Theory Z or Japanese Management, but which in reality was little more than American human relations warmed over. Nevertheless, the fact is that the '80s brought a period of renewal and return to the fundamentals of self-control as put forth decades before by Peter Drucker, and which he taught to the Japanese in the '50s.
(To be continued next week)
Ed Yager is a Park City consultant specializing in organization and individual performance improvement. Under license to Chuck Coonradt, the author of the book "The Game of Work," he has developed an instructional design for implementing Performance Management based on Coonradt's concepts, many of which are combined in these articles.