Ten years ago, I wrote that the performance appraisal treadmill is keeping organizations from testing out and adopting better management models for the networked economy. Performance appraisals are like academic grades and keep the focus on the individual. In a collaborative, social enterprise this is counter-productive. In today’s enterprise, work is learning and learning is the work, and it has to be done cooperatively.
“Evaluation of performance, merit rating, or annual review … The idea of a merit rating is alluring. The sound of the words captivates the imagination: pay for what you get; get what you pay for; motivate people to do their best, for their own good. The effect is exactly the opposite of what the words promise.” —W. Edwards Deming (1982)
Even technology companies are governed by outdated management models.
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