Individual Performance Management
The traditional level at which performance management is used in organisations is the individual level. Individual performance management is perhaps the level with the longest evolution in history, as it mirrors the level of organisational maturity. The precise origin of performance appraisals is not known but the practice dates back to the third century when the emperors of the Wei Dynasty (221-265AD) rated the performance of the official family members (Banner & Cooke, 1984, Coens & Jenkins, 2000).
In early times, organisations were loosely defined and their performance management focus was based on individuals performing tasks as part of a group. Performance appraisals in industry were most likely initiated by Robert Owen in the early 1800s (George, 1972). Owen monitored performance at his cotton mills in Scotland through the use of "silent monitors.” The monitors were cubes of wood with different colours painted on each visible side. They were displayed above the workstation of each employee (Banner & Cooke, 1984; Wiese & Buckley 1998).
In time, more complex approaches emerged, mainly driven by the military, public administration and industrial companies. They all needed a system of monitoring the performance of numerous individuals to ensure a streamlined progression in the organisational hierarchy. The main drivers in the evolution of individual performance management were industrial psychologists, human resources managers, organisational development and organisational behaviour consultants.
Development of performance appraisals in United States industry began with early work in salesman selection by industrial psychologists at Carnegie-Mellon University, who used trait psychology to develop a man-to-man rating system. The army used this system during World War I to assess the officer performance. After the war, business leaders, impressed by the achievements of the army researchers, hired many of the men who had been associated with the work in man-to-man appraisals (Scott et al., 1941; Wiese & Buckley, 1998).
In the 1970s in America and the 1980s to 1990s in Britain it was government legislation concerning such things as equal opportunity, civil rights, etc. which compelled organisations to adopt some sort of system. Performance Management Systems (PMS) were used in the 1980s and 1990s as powerful tools for change to try to bring about change in public sector culture and ethos (Furnham, 2004).
In the 1990s individual performance management was reshaped by two key trends. The first was the increase in popularity of self-assessment of performance, sometimes followed by feedback sessions with line managers. The increase in performance self-assessment was natural as economies were dominated by knowledge workers, more independent in regards to decision making and management of work processes (Drucker, 1999). The second key trend in recent years was the integration between strategic performance management and individual performance management facilitated by the introduction of tools such as the BSC. Organisational goals became reflected in individual goals and individual measures became aligned with organisational performance measure, in an effort to increase the accountability of all employees to the execution of the organisational strategy.
- Brudan, A. (2010), Rediscovering performance management: systems, learning and integration, Measuring Business Excellence, VOL. 14 NO. 1, pp. 109-123.
- Banner, D.K., & Cooke, R.A. (1984), Ethical dilemmas in performance appraisal, Journal of Business Ethics, Vol. 3, 327-333.
- Coens,T., & Jenkins, M. (2000), Abolishing performance appraisals: why they backfire and what to do instead, Berrett-Koehler Publishers, San Francisco.
- Drucker, P.F. (1999), Managing Oneself, Harvard Business Review, Nr. March-April, 65-74.
- Furnham, A. (2004), Performance management systems, European Business Journal, Vol. 16, Nr. 2, 83-94.
- George, C.S., Jr. (1972), The History of Management Thought, Prentice-Hall, Inc., Englewood Cliffs, N.J.
- Wiese, D.S. & Buckley, M.R. (1998),The evolution of the performance appraisal process, Journal of Management History, Vol. 4 No. 3, 233-249.
- Scott, W.D., Clothier, R.C. & Spriegel, W.R. (1941), Personnel Management, McGraw-Hill, New York, NY.