At a gymnastics competition, judges use numbers to rate individual performances. A perfect routine? That’s a “10”. A botched dismount combined with a belly flop? That’s a “2”. In the workplace, many workers connect the numerical scores on their performance appraisals with a competition. They strive for the perfect “10” to get the pay raise or bonus. And we see a lot of backflips, reverse somersaults, belly flops and other bizarre behaviors in pursuit of higher scores.
In my previous post on what’s wrong with performance appraisals, I explored big-picture issues such as managers who won’t manage and HR departments that won’t listen. Here, I’m taking a closer look at a specific problem with many systems – the use of numbers to rate individual performance.
First and foremost, individual performance scores inspire competitive, individual behaviors. That’s why they work so well at a sports competition and not so well at an office. In the workplace, overall success is reliant on individuals working as a team, not as a group of mavericks.
Second, managers who put too much focus on scores also miss the mark. Management expert W. Edwards Deming pointed this out years ago when he said managers who concentrate too much on individual performance run the risk of missing larger systemic problems. The manager is spending too much time figuring out the right score; the employee spends too much time trying to win a higher number. Meanwhile, no one is looking at team behavior or the big picture.
Organizations that tie pay raises, bonuses and other financial incentives to these scores are asking for even more trouble. Studies show that performance does not increase with monetary rewards beyond a minimum level. Plus, attaching money to a rating will bring out super-competitive and counterproductive behaviors in some people. It also supercharges emotions and explains a lot of dysfunctional behaviors seen before, during and after appraisals.
Can numbers ever play a role in performance management systems? Sure. Individuals, teams, departments and the entire company need to have targets and should be held accountable to them. These numbers serve a purpose in getting everyone on the same page and in providing a measure for success or failure.
For the individual, however, numerical ratings are toxic and press all the wrong buttons of employees and managers. It’s time to ditch the digits and instead focus attention on substantive, meaningful communication that drives individuals to perform in line with your organization’s goals.