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Featuring
DipQA graduate: NNZZOOQ Melissa Graham
LSS project at Aegis
Proposed Standards
Bill
Prevention and
participation in
healthcare
Customer loyalty
Measuring product
and service quality
Going green using
Lean
Business
sustainability 1-day
workshop
Report on 3rd
IAQ/ANQ 2014
Symposium
aatttteenndds .....
And more …
1122tthh AANNQ
CCoonngg
eesss
2200114 – SSiinnggappooree
NEW ZEALAND ORGANISATION FOR QUALITY
Octo
ber
2014
2 | Official Magazine of the New Zealand Organisation for Quality – October 2014
Q share: Systems thinking
Moving beyond performance management systems
I find it interesting that in the last
3 organisations in which I have
worked, all have talked about the
need for working cohesively –
working together with the solid
aim of serving the customer, writes
QNewZ columnist Sarah Benjamin.
Also interestingly, these three
organisations employed performance
management systems (PMS) that
seemed to be unintentionally actively disengaging staff
while ensuring that they were not working cohesively. This
is typical, in my experience, of performance management
systems.
PMS – is it useful?
Within these organisations, employees met with their
managers quarterly to assess their performance against
agreed targets set by the organisation. Failure to meet these
targets led to discussions about improving performance –
while meeting or exceeding them led to rewards such as a
financial bonus.
All employees agreed (with their manager) on ‘things’ that
needed to happen over the next 3 - 6 months to further
improve performance. Sometimes this involved more
‘training’ – a possible source of embarrassment for the
employee.
W. Edwards Deming wrote in Out of the Crisis1: “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.”
Deming recognised performance management of people as
being one of the 7 deadly diseases of modern management.
He commented, “Stop doing them and things will get better.”
Well, why would that be? As he wrote in the introduction
of Peter Scholtes’ book The Team Handbook2: “The fact is
that the system that people work in and the interaction with
people may account for 90 or 95 percent of performance.”
What stops us doing work?
I agree with Deming, and I have discussed this at length
in previous articles. But for those still unconvinced I would
urge you to read about the Red Bead Experiment and then
explore the causes of variation within your own organisation.
In every case I have ever seen, whenever you start really
understanding the reasons that stop us doing our work, they
will always lie within the control of the system and not with
the individual.
Although this may never be a concept articulated by your
front-line staff, intuitively they know this. Therefore in creating
what essentially becomes a competitive environment
(we can’t all ‘win’) we effectively put into play a series of
dysfunctions that will never serve organisational purpose.
How are they ever meant to truly improve something over
which they have no direct control? Yet we continue to hold
them accountable for it.
Mary Poppendieck explores these dysfunctions through an
Agile case study in the paper ‘Unjust Desserts’3. Regardless
of what you think of Agile (and I have my views) the
dysfunctions described by Poppendieck ring true to me. I
would urge you to read the article and her descriptions. I
have summarised her descriptions below:
Competition: Ranking people against each other for merit.
Thus pitting them against each other and destroying any
hope of collaborative working and often worse, using it as a
means to dismiss the ‘poor performers’.
The perception of unfairness: If the performance system is
perceived in any way to be unfair, whether real or perceived,
then those involved will rapidly lose motivation.
The perception of impossibility: If we set goals and targets
in the work, especially those linked to financial motivators
that are perceived or understood to be impossible to
achieve, people will become cynical and turn off.
Sub-optimisation: If we set targets and goals within our
organisation that our employees are charged with meeting,
especially those linked to a reward, they will find a way to
meet this number – even to the detriment of the customer
and work, sub-optimising overall performance.
Destroying intrinsic motivation: All of this works to destroy
intrinsic motivation. And as our employees become used to
an “I do this to get that” environment, work becomes about
the achievement of that.
I have seen examples of every one of these in all of the
organisations I have been working with who use a traditional
performance management system. The work of Alfie Cohen5
covers this last dysfunction extensively. And again in relation
to the first point in the article, all of the above assumes the
employees to be in control of the work they do.
Performance management is paying attention to the 5% of
the work and actively driving dysfunction and discourse
into work in the process. It’s a ‘lose-lose’. When asked “So
what do we use instead?” Deming replied “Whatever Peter
Scholtes says.” (p. 296)
Focus on systems, processes and methods
In Total Quality or Performance Appraisal: Choose One,
Peter Scholtes writes: “Improvement efforts should focus on
systems, processes, and methods, not on individual workers.
Those efforts that focus on improving the attentiveness,
carefulness, speed, etc. of individual workers – without
changing the systems, processes, and methods – constitute
a low-yield strategy with negligible short-term results…
Conventional problem-solving would ask such questions
as: Whose area is this? Who is supposed to replace worn
Official Magazine of the New Zealand Organisation for Quality – October 2014 | 3
continued on page 11
continued from page 16
gaskets? We don’t ask ‘why’, we ask ‘who’. We don’t look
for causes in the system; we look for culprits in the work
force. Performance appraisal is a ‘who-based’ approach to
problem-solving.”
Scholtes’ The Leaders Handbook ends with ‘the 47 habits of
pretty good leaders’. I would urge you to read them. It might
not give you all the answers, but it is a good place to start.
I suggest you give more attention to the system and work
to improve it by understanding what a good job within that
system looks like, value contributions, offer appropriate staff
remuneration and opportunities to progress, and then pay
people accordingly. That must be a good place to start.
For further information please contact
References 1 Deming, W. Edwards, Out of the Crisis, MIT Press 2 Scholtes Peter R, The Team Handbook: How to Use Teams to Improve Quality 3 Poppendieck Mary, http://www.poppendieck.com/pdfs/Compensation.pdf 4 Cohen Alfie, Punished by Rewards: The Trouble with Gold Stars, Incentive Plans,
A’s, Praise, and Other Bribes, Houghton Mifflin
