This paper is based on ‘Managing in the Middle’ by Barry Oshry, which can be found at www.executiveforum.com

Even in today’s world of flatter, leaner organisations, most organisations continue to have three levels of hierarchy. At the top there are the people who shape and give direction to the entire organisation. At the bottom are the workers, who manufacture the business’s products or render its services. Between them are those in the middle, often torn between meeting the demands of those at the top and responding to the needs and concerns of the workers they are expected to manage. The middle can be a confusing and ambiguous place, yet it is potentially a point of powerful influence, both upwards and downwards.

Oshry refers to the three groups as ‘Tops’, ‘Middles’ and ‘Workers’.

The Middle Dilemma

Unfortunately not many Middles perceive their potential power. Oshry identifies the following characteristics of ‘the Middle dilemma’:

1. Middles tend to work long and hard, often in response to the demands of others. ‘Middles tend to be in perpetual motion, carrying with them never-ending lists of meetings to attend, items to accomplish, errands to run, unfinished paperwork to edit, business transacted on the run, constant intrusions and so on’.

2. Middles often feel they receive little support or gratitude, up or down.

3. Middles are often confused by their role, as they try to respond to both upwards and downwards demands. As a result they often assume compromise positions which end up pleasing no one, not even themselves.

4. Often it seems that the significant action lies with the Tops, who make the strategic decisions, or the Workers, on the front line delivering products and services. The roles of Middles can feel comparatively unrewarding.

5. ‘Very often Middles are isolated and lonely, accepted by neither Tops or Workers, separated from their peers by focus and work unit. They often silently harbour interpersonal tension and competitive anxieties with respect to their peers.’

6. Middles often feel their role is primarily reactive, responding to the actions of Tops and Workers. Their scope for individual thought and action can feel very limited.

7. Middles tend to personalise their experiences. When a situation goes badly, they tend to blame themselves.

Middles as Diffusers and Integrators

Oshry identifies the ‘essential functions of Middleness’ as ‘diffusing’ and ‘integrating’. Both are critical for the organisation.

Diffusion refers to the inward and outward flows of information that enable effective decisions and actions to be taken. Oshry writes

‘Middles distribute out to the system the “essence” of the units they service or manage, and bring back into the units the “essence” of the organisation.’

Middles interact frequently with Tops, other Middles, Workers – often also clients and suppliers. They are therefore uniquely well placed to influence all these other groups. The contacts and information available to Middles can enable them to see the total system more clearly than either Tops or Workers.

The risk that Middles face is that all this interaction means they end up seeing so many conflicting possibilities that they feel overwhelmed by them. For diffusion to work well, it needs to be partnered with integration. This involves Middles integrating with each other, to share ideas and experiences and identify how these can be utilised for the benefit of the whole organisation.

There are some risks attached to this. Middles are hired and fired as individuals, and may therefore find it difficult to trust peers who may personally gain from undermining them. Tops may be resistant to Middles working together as a group, fearing their collective power to influence. However, if the potential for Middles to contribute effectively to the system as a whole is to be maximised, then these fear factors must be overcome.

Mastering the Middle Space

‘In a nutshell, the process of mastering the middle space is the process of mastering the system.’

Mastering the system involves seeing the wider picture, identifying systemic problems and systemic solutions. This involves moving away from the ‘blame culture’ where Tops blame problems on individual Middles, and Middles personalise their experiences and blame themselves. The benefits of seeing issues systemically rather than personally are:

• Freeing up Middles to focus on goals
• Increasing empathy – both to and from Middles
• Middles are able to be more strategic when they take others’ worlds into account
• Partnerships develop, enhancing effectiveness and reducing personal stress

Some Top Tips for Middles

• Resist the urge to make other people’s problems, issues and conflicts your own. Your job is to coach and empower them to resolve their issues, not take responsibility for them

• Keep your own mind. Pay attention to your point of view, your values, your solutions. This will maximise your personal contribution to collective problem solving.

• Be a Top whenever you can. If you can resolve a problem without passing it up to the Top, then do it. Tops only need to be involved with problems that are unsolvable at the Middle level.

• Be a Worker when you should. If your team is short-staffed or has a sudden influx of work, then help them out with it. But remember, this should only be a short term solution. If it becomes long term then you need to re-focus on the systemic problems which are causing it.

• Facilitate solutions by bringing together the people who need to be together, and helping them to have productive interactions. This is more effective than trying to act as a buffer between them.

• Integrate with other Middles. Strong, interactive relationships with your peers will enable you to make a strong collective contribution and reduce your feelings of isolation.

Before You Start

Identify clearly what you want your presentation to achieve. Is the aim of your presentation

To inform – providing your audience with new information - eg about plans for a new computer system

To educate – equipping your audience with the knowledge and skills to operate the new computer system effectively

To persuade – convincing your audience that the new computer system is a good idea

Your approach will depend on what you are trying to achieve. An information-giving presentation is likely to be focused on you as the presenter, as the purpose is for you to convey information that the audience don’t yet have. The challenge with this type of presentation is to keep it interesting – remember that the average human being has an attention span of around 10 minutes!

Educational and persuasive presentations are more likely to involve the audience. A classic approach to an educational presentation is ‘Tell-show-do’ – tell them how to carry out a task on the new computer system, show them by demonstrating it yourself, then get them to have a go at doing it themselves. In this way the structure moves from being presenter-led to a more participative approach.

Persuasive presentations require interaction between the presenter and the audience. People will only be persuaded if you listen to their objections and concerns – so you have to build this into your structure. Remember to allow sufficient time for this – people will go away dissatisfied and frustrated if they feel their concerns have not been addressed.

The Presentation ‘Diamond’

The ‘Diamond’ provides a sound structure for most types of presentation. It opens with an introduction to yourself and your subject, broadens out into a discussion of the main points you have to get across, before narrowing down to a close with questions, a summary of the main points and identification of what action your audience will take following the presentation. One of the benefits of the Diamond is that you cover your main points three times:

· In the introduction – This is what I’m going to say
· In the main body of the presentation – You say it
· In the close – You summarise it

Some tips on using the Diamond:

Pay particular attention to the two points of the Diamond – the opening and the close. These are your points of maximum impact.

The opening – think carefully about the impact you want to make on your audience. Do you want to grab their attention with a funny remark or a witty anecdote, or will it be more beneficial for you to build rapport with them first. A lot of stand-up comedians start by chatting with their audiences – eg sharing their first impressions of the town, or talking about their journey – before moving into their act.

Another effective opening technique is to tantalise your audience with the benefits of staying with your presentation until the end. One colleague I work with promises to end her presentations by revealing the secret of eternal life, which grabs an audience’s interest no matter what the subject matter!

The close – many presenters make the mistake of slowly spluttering to a halt, like a car when it runs out of petrol. Audiences are most likely to remember the last thing you say, so make sure it’s something worth remembering! This might be an inspiring quotation, your vision for a brighter future, the punchline to a joke you started earlier in the presentation or even – in my colleague’s case – the secret of eternal life (if you promise it you have to deliver!).

The main body – write down the main points you want to cover then divide them into three categories:

· Must knows – the points which are essential to achieving your objectives

· Should knows – additional information that your audience will really benefit from hearing

· Could knows – anecdotes, stories and peripheral information that your audience will find interesting, but which is not fundamental to getting across your main message

And Finally…

‘In good communication,
People should be in no doubt that you have reached a conclusion’

(John Adair and Neil Thomas)

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In his book ‘A Whack on the Side of the Head’ (Warner Books, 1990) Roger von Oech identifies ten mental locks – restrictive ways of thinking that we get shut into.

1. The right answer
2. That’s not logical
3. Follow the rules
4. Be practical
5. Play is frivolous
6. That’s not my area
7. Avoid ambiguity
8. Don’t be foolish
9. To err is wrong
10. I’m not creative

‘A Whack on the Side of the Head’

Von Oech suggests that ‘we all need an occasional whack on the side of the head to shake us out of routine patterns, to force us to re-think our problems, and to stimulate us to ask the questions that may lead to other right answers’.

Fortunately the ‘whack on the side of the head’ recommended by von Oech is a metaphor – no physical violence should be involved! Metaphors are a powerful technique for unblocking thinking which has become stuck and helping us to see things differently.

Metaphors

Much of the language we use when talking about business involves the use of metaphors – we talk of ‘flooding the market’, ‘pumping money in’, or ‘freezing assets’. Some of these metaphors have become clichés – so commonly used that we no longer register the gap between the words used and the message they convey.

Stand-up comedians are good at coming up with new metaphors, which make people look at the world in a different way. For example:-

‘Whales living off krill and plankton is like Geoff Capes eating only hundreds and thousands’

(Sean Lock)

‘The Football Association holding an enquiry into why England didn’t qualify for Euro 2008 is like an inquiry being held into the why the Titanic sank by the iceberg’
(Sandi Toksvig, The News Quiz)

A business presentation will be enhanced by the use of metaphors. Some you can take ‘off the shelf’ (to use another metaphor!) – for example:

‘The mind is like a parachute –
It works best when it is opened’

(The Dalai Lama)

‘People often say that motivation doesn’t last. Well, neither does bathing. That’s why we recommend it daily.’

(Zig Ziglar)

At other times we might want to illustrate our points by coming up with our own metaphors. For example, in an e-mail to Sally when we were designing this course I wrote

‘It’s like cooking a meal using two very different ingredients. Will it work best if we mix them together – like duck in a plum sauce; or will it be better to keep them separate as a main course and dessert, like chicken and banana?’

This helped to unblock our thinking and make decisions about at which points in the course to bring together stand-up skills and business presenting, and at which points to keep them apart.

‘What If?’ Questions

Another useful technique for unblocking creativity is to ask ‘What if?’ Paul Merton’s surreal flights of fancy on ‘Have I Got News for You’ often begin with a statement like ‘Wouldn’t it be great if…’

Wouldn’t it be great if…

• We started doing what we enjoy, rather than what we think will make a profit?
• We told our customers/colleagues/bosses what we really think of them?
• We made all public servants wear fancy dress (not just the judges!)

Some ‘What if?’ questions you might like to apply to your business – or which might prompt a reaction from your audience if used as part of a presentation:

• What if…We throw out all our policies and procedures and make up the rules as we go along?
• We all stopped bothering to turn up in the morning?
• Whenever we get a piece of advice, we do the opposite?

Paradoxes

‘How wonderful that we’ve met with a paradox. Now we have hope of making some progress’

Niels Bohr (physicist)

Paradoxes can be a great source of inspiration. Von Oech writes ‘the very act of seeing the paradox is at the crux of creative thinking – the ability to entertain two different, often contradictory, notions at the same time’. For comics the bringing together of these different or contradictory ideas is often the source of their jokes.

Some paradoxes for you to mull over:

‘If you can remember the sixties, then you weren’t there.’

(Timothy Leary)

‘We can’t leave the haphazard to chance’

(N. F. Simpson)

‘I would not care to belong to a club that accepts people like me as a member’

(Groucho Marx)

Challenge the Rules!

Stand-up comedians are very good at challenging ‘rules’ – often through asking ‘why’ questions. They’ll identify an absurd aspect of everyday behaviour then ask ‘Why do we do that?’ They’ll also be willing to slay sacred cows (after all, they make great steaks). The role of the comic is often to think the unthinkable, and to say the unsayable.

So - what if you started doing more of this in your business presentations? You’d certainly stimulate a reaction!

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In this paper I will first consider some definitions of performance appraisal. I will then consider the philosophy of Human Resource Management (HRM), and how this encompasses some different approaches to performance management. These formal elements will have a marked impact on the way in which performance appraisal is conducted, but so will the informal processes within the organisation. I will therefore also consider the impact of social factors and relationships on the appraisal process. Finally I will consider the effects of changes in approach over recent years, and their impact on the theory and practice of appraisal. I will argue that, while all these factors affect whether appraisal is used as a means of developing or controlling the employee, performance appraisal is primarily a means of control and that even when development is stressed it is usually within parameters which are tightly controlled by the organisation.

At first glance performance appraisal appears as though it should be something relatively straightforward. Torrington, Weightman and Johns (1989) offer a working definition of appraisal as

‘The process of judging a person’s performance and reporting that judgment.’

(Torrington, Weightman and Johns 1989: 814)

This looks simple enough, but soon gives rise to a host of questions. Who should judge the person’s performance? How should the judging be carried out? Who should the judgment be reported to? And what will be done with that information once it has been received?

An alternative definition is offered by Cascio (1986), who describes performance appraisal as

‘…the systematic description of job-relevant strengths and weaknesses within and between employees.’

The Centre for Labour Market Studies (CLMS) point out the narrowness of this definition, and how it lacks any reference to the strategic considerations which are central to performance management. So a fuller definition would relate individual performance to the wider context of organisational goals and requirements.

To understand performance appraisal and why it is the subject of such debate it is necessary to place it firstly in its historical context, and secondly in the context of the development of differing approaches to HRM. Performance appraisal has been around in one form or another for a very long time; Grint (1993: 829) refers to Swan (1991:16) quoting a third century Chinese appraisal assessment. For our purposes its relevant history probably begins in Robert Owen’s Lanark textile mills of the 1800s, when a piece of wood was placed by each employee’s machine each day marked with a different colour, which denoted the supervisor’s opinion of that worker’s performance on the previous day. This gave rise to an annual assessment which was recorded in a “book of character”. The assessments were subjective, which is one of the main criticisms still levelled at performance appraisal today.

In the early part of the twentieth century Owen’s ideas were superseded by those of ‘scientific management’, devised by F.W. Taylor and popularly associated with Henry Ford. This emphasised the use of quantitative methods to measure work performance, and led to the development of ‘work study’ techniques in the inter-war period. In 1955 Peter Drucker advocated Management by Objectives. This involves clearly identifying and communicating the organisation’s objectives, then specifying objectives for each employee setting out their individual part in achieving these. The SMART acronym has been developed to highlight the characteristics of effective objectives for individual job holders; they should be Specific about the required outcome, Measurable so that achievement can be determined, Agreed between the manager and the job holder, Realistic so that they are stretching but achievable, Time-bound so there is a clear deadline.

In theory, at least, Management by Objectives provided a clear and unambiguous framework for specifying and measuring employee performance. However, the approach has been criticised on a range of grounds. Levinson (1970) suggested that by measuring what is achieved, against objective standards, there is a risk of overlooking how those results are achieved. So a manager may be rewarded for meeting targets, even though the way in which they achieved those results was by bullying their subordinates. This links to a second concern, that important but difficult to measure qualitative aspects of the task may be sacrificed for more easily measurable, but less important, quantitative indicators. I have seen this in my own experience as a manager in the Court Service. The key attributes of an effective court usher are the abilities of establishing rapport with everyone who enters the court, ranging from judges and the legal profession to defendants and witnesses. But it is difficult to set objectives for such attributes, and much easier to measure factors such as whether they set up the courtroom on time with sufficient carafes of water.

Levinson’s final concern is that Management by Objectives often overlooks individual’s personal needs and objectives, and focuses solely on those dictated by the organisation. Fowler (1990) made similar criticisms, adding the risks of managers perceiving the setting and review of objectives as a centrally imposed administrative task and therefore paying lip service to it as a mechanical annual exercise (Armstrong and Baron 1998: 560-561).

The roots of Management by Objectives lie in behaviourism and focus on measuring and assessing employees’ performance on the basis of what they do. An alternative, the trait approach, was developed by the American and British military following the Second World War. This involved identifying desirable personality traits and then assessing the extent to which they were displayed by individuals. Traits might include such factors as drive, initiative, judgment and reliability (Torrington, Weightman and Johns 1989: 821), which were all identified as key ‘personal qualities’ in the British Civil Service appraisal scheme. The difficulties with this approach were twofold. Firstly the judgment of these traits was wholly subjective, and secondly no clear correlation was established between possession of these traits and effective job performance (Grint 1993: 830).

Performance appraisal today continues to combine a range of methods in an effort to produce reliable employee assessments which minimise subjectivity. In recent years competencies have been introduced, which attempt to encapsulate the knowledge, skills and attributes required for effective performance in a particular job role. Performance appraisal systems have been extended to include upward appraisal and 360 degree feedback, to give a wider reflection of individual performance. I will discuss the impact of these developments more fully later in this paper. However, the way in which they are applied depends on the underpinning philosophical approach to HRM.

This raises the questions of what is Human Resource Management, and how does it differ from personnel management? Is it a new development, or the same old wine in a flashy new bottle? Undoubtedly in some organisations it is simply a change of label, with the personnel department being renamed the HR department and life going on much as before. However, a number of writers have attempted to tease out the differences in approach. Legge (1988) writes that HRM ‘appears to be’

‘…a more central, strategic management task than personnel management in that it is experienced by managers, as the most valued resource to be managed, it concerns them in the achievement of business goals and it expresses senior management’s preferred organisational values.’

(Keenoy 1990: 390)

The differences highlighted here are the strategic nature of HRM, the focus on the importance of managing the managers, the emphasis on both achieving business goals and promoting organisational values. Storey (1992) produced a model setting out twenty seven points of difference between personnel and HRM approaches. The model is based around four key dimensions: beliefs and assumptions, strategic aspects, line management and key levers. Words and phrases which appear in relation to the traditional Personnel role include ‘procedural’, ‘transactional’, ‘institutionalised’ and ‘careful delineation of written contracts’. Contrast these with those relating to HRM: ‘Can-do outlook’, ‘values/mission’, ‘nurturing’, ‘transformational leadership’. Clearly Storey is highlighting HRM as a very different philosophical position from traditional personnel management, but that still leaves us to pin down exactly what HRM is.

Storey identifies two types of HRM: ‘soft’ and ‘hard’. Soft HRM has its roots in the Human Relations school, seeing employees as a resource to be invested in. Hard HRM takes a more utilitarian point of view, seeing labour as a factor of production in the same way as land or capital, and concentrating on ‘deploying the right number of people with the right skills in the right jobs’. While appearing very different these two approaches are not incompatible, and both share a priority of ‘planning a supply of readily skilled labour to meet organisational demand in the most efficient manner’. However, with regard to performance appraisal the identification of these two distinct schools is important. A ‘soft’ HRM approach is more likely to stress the developmental aspects of appraisal, while a ‘hard’ HRM approach is more likely to stress the controlling aspects. Unless there is recognition of these different approaches to HRM and regard for the validity of both, managers operating appraisal systems run the risk of being pulled in two potentially conflicting directions.

Despite these potential conflicts within HRM some consistent themes emerge. One is the stress upon the strategic nature of HRM. Truss and Gratton (1994) identify three key features of Strategic HRM. Firstly there must be an explicit link between HR policies and practices and the overall strategic aims of the organisation. Secondly, HR interventions must be organised and linked so that they are mutually supportive and make a coherent contribution. Thirdly, much of the responsibility for human resource management is devolved to line management.

Storey and Sisson (1993) highlight a number of problems with the notion of strategic HRM, among them a ‘constellation of dilemmas’ relating to performance appraisal:

‘On appraisal, will behavioural criteria or results criteria be used? Will the short-term or long-term be the chosen time-frame? Will the focus be on individual or group performance? Regarding compensation arrangements, will there be a simple base salary with no extra incentive payments or will there be many?’

(Storey and Sisson 1993: 426)

They go on to highlight how these considerations might affect how appraisal is carried out. For example, if an organisation’s strategy focuses on promoting innovation and creativity this is likely to be reflected in appraisals which reflect longer-term achievements. It might also follow that appraisals are more likely to be developmental in approach, with a view to encouraging employees to develop a broad range of skills. However, if an organisation’s strategy is focused on cost reduction, then appraisals are more likely to be orientated towards the achievement of short-term goals at minimal cost. The philosophy of such a strategy is likely to promote a controlling approach to appraisal, along with the practical consideration that little investment is likely to be made in providing employee development (Storey and Sisson 1993: 427).

In many organisations performance appraisal is part of a wider strategy of performance management. CLMS identify a range of approaches to performance management, including High Performance Work Systems (HPWS) and Human Performance Technology (HPT). Here I am more concerned with performance management in broad terms, and its relationship to appraisal.

In 1992 the (then) Institute of Personnel Management defined performance management as

A strategy which relates to every activity of the organisation set in the context of its human resources policies, culture, style and communications systems. The nature of the strategy depends on the organisational context and can vary from organisation to organisation.

(Armstrong and Baron, 1998: 568)

Performance management is seen by Armstrong and Baron as ‘a means of aligning organisational and individual objectives to achieve organisational effectiveness’. (Armstrong and Baron, 1998). It is based on two main assumptions. The first of these is that when people know what is expected of them, and have some say in this, they will do their best to achieve it. The second assumption is that performance will be dependent upon ‘the levels of capability that can be achieved by individuals and teams, the level of support they are given by management, and the processes, systems and resources made available to them by the organisation’ (Armstrong and Baron 1998).

Performance management involves a continuous cycle of planning, acting, monitoring, reviewing then planning again. For many organisations this cycle links clearly into the performance appraisal process. At the beginning of the appraisal period employees meet with their managers to draw up personal development plans, setting out agreed objectives, what will need to be done in order for them to be achieved, and how performance will be measured. Employees are then expected to act in accordance with these plans, while their managers monitor their performance and provide regular feedback. Regular formal reviews are built into the process, although often they do not take place as regularly as the scheme specifies. At the end of the cycle an annual review and written report is completed, then a new plan is drawn up for the next year.

Performance management therefore involves both identifying and meeting the development needs of the individual, while also intervening at a strategic level to influence the setting of organisational objectives. It also requires detailed and continuous analysis of individual performance. However, often this analysis is not empirical, and is dependant on the perceptions of the line manager carrying it out.

This brings us to a fundamental problem with performance appraisal. Whatever the underpinning philosophy, and whatever procedures are adopted, it is carried out by human beings. In most cases at present the human beings with the lead role are line managers, who make statements such as the following:

‘Performance appraisal is a load of rubbish. You decide on the rating you want in the box and then make up a few words of narrative in the other sections to justify it.’

(Manager from County NatWest Group, quoted by Carlton and Sloman, 1992:06; cited by Grint 1993: 830)

While it would be unfair to characterise this as representative of managers’ attitudes to performance appraisal in general it does highlight the cynicism and doubt which often surrounds the subject. Sometimes this stems from a lack of credibility surrounding the appraisal process. Grint (1993: 831) points to the common assumption that appraisals are often ‘political’ in nature, that they are mechanisms for justifying decisions which have already been taken and disregard individual merit. This is particularly the case when performance related pay (PRP) is involved. Townley (1995: 866) refers to the introduction of PRP in the UK National Health Service, which had the underlying aim of cutting salary costs. Whether or not they are founded such suspicions are widely held throughout the public sector in the UK, as I have discovered when delivering training on a number of new or revised appraisal schemes. The result is that all attention becomes focused on this one issue, and that any good intentions about utilising performance appraisal as a means of personal development become lost.

At times, then, difficulties arise from the hidden agendas or ‘politics’ associated with appraisal schemes, but more generally there appears to be evidence that managers lack the competence and/or confidence to operate performance appraisal effectively. As I highlighted in the introduction to this paper, most organisations expect their performance appraisal schemes to meet a multiplicity of needs. This means that the manager is often required to take on the roles of both judge and helper (Vickerstaff 1992), a delicate balancing act that few managers feel equipped to carry out.

Redman, Snape and McElwee (1993) suggest that there are two broad models of performance appraisal: judgment-oriented and development-oriented. Judgment-oriented appraisal tends to be backward-looking, measuring performance against organisational standards then telling the employee how they have done. Development-oriented appraisal is more forward-looking, with the appraiser taking the role of helping the employee to self-assess their own performance. In simplistic terms the first approach is controlling, the second developmental. However, in reality these two ‘ideal types’ tend to get mixed up, and even systems which aim to be highly developmental give rise to a number of judgments being made about the employee Redman, Snape and McElwee (1993:5).

Torrington, Weightman and Johns (1989) take a similar view, highlighting two broad approaches to appraisal, which they describe as the control approach and the personal approach. The control approach is more common and stresses targets, performance and rewards. It is initiated by senior management and therefore tends to be treated with suspicion and resistance by employees. The personal approach, which is less common, is job-holder led and focuses on development and fulfilling potential (Torrington, Weightman and Johns 1989:812-813). They cite Maier (1976) as describing three alternative approaches adopted by managers when conducting appraisal review meetings. The first of these is Tell and sell. This emphasises the manager’s role as judge, telling the employee the outcome of the appraisal and where they need to improve. This approach may be effective with inexperienced employees, but is unlikely to be well received by someone who feels they have the capacity to judge their own performance. It is highly controlling.

The second approach, Tell and Listen, is a modification of this. The appraiser still takes on the role of judge, passing on the results of an appraisal which has already been completed, but then elicits the appraisee’s reactions. This may enable the appraisee to influence the results, by offering evidence or explanations which were previously unknown to the appraiser. Certainly this approach is more likely to involve the appraisee in decisions about how development needs might be addressed, such as whether they would prefer to attend a training course or receive such on the job coaching. Nevertheless, identification of the development need in the first place remains with the appraiser. Most of the control therefore remains with the appraiser, but the appraisee is allowed their say within the limits that the appraiser allows.

The third approach, Problem-solving, is described as a very different kind of interview. The emphasis is not on the judgments of the appraiser but the growth and development of the appraisee. The appraiser’s role is to elicit their self-reflection, so that the appraisee is able to identify their own strengths and development needs, and how these needs might be met. The term ‘problem solving’ may be off-putting to the employee – the appraisal may reveal a high level of performance with few problems at all! ‘Non-directive interviewing’ is a possible alternative, and is more likely to provide a focus on future development.

Problem-solving or non-directive interviewing might seem the most appealing of these three approaches, but the right conditions need to be in place for it to be effective. The appraisee needs to be confident, secure, self-aware, and aware of development opportunities. The appraiser needs to have highly developed questioning and listening skills and the ability to engage with the appraisee as an equal, even if they are more senior in the organisational hierarchy. Perhaps one of the biggest difficulties with this more personal, development-oriented approach to performance appraisal is that it is so different from most people’s prior experience. I have been involved in delivering training on an appraisal scheme for magistrates, where the focus is very much on appraisers using the skills required to encourage appraisees to reflect on their own performance. However, in most instances their experience in the workplace has involved Tell and Sell or Tell and Listen appraisals, both as appraisers and appraisees. This means that the starting point for both is an expectation that the appraiser will judge the appraisee’s performance, and that both parties find it hard to move to a more reflective and developmental process.

Randall et al (1984) offer a similar set of styles, with an additional approach they describe as Listen and support. This is similar to Tell and Listen, but is more likely to be required when the manager’s feedback has been critical and has highlighted performance problems which need to be addressed. The manager may first need to listen to the employee’s initial defensive or angry reaction, then provide support through the process of addressing the performance problem. Adopting this style would therefore usually follow on from one of the first two.

All of these approaches to performance appraisal link closely to the various models of leadership and management styles, such as Tannenbaum and Schmidt’s autocratic-participative range of decision-making styles. The Tell and sell approach is at the autocratic, highly controlling end of the continuum, while Problem solving or Non-directive interviewing is far more participative. Nevertheless, the definition of this participative style of management is that the ‘Manager permits subordinates to function within limits defined by him/her’, so the manager still retains control and may rein the employees back in if they feel it necessary (Pettinger 1997: 117).

It is often stressed that an effective manager must have the flexibility to move along this continuum, knowing when to retain tight control themselves and when to hand over some of this control to their subordinates. The same goes for appraisal interviewing, and an effective appraiser should be able to adopt any of the above styles according to the needs of the situation and the individual appraisee. However, it appears that many managers lack the skills to adopt the range of interview styles. Grint (1993:831) highlights a lack of interpersonal skills on the part of managers, while Cascio (1986) identified that ‘many employees felt less certain about where they stood and evaluated their appraisers less favourably following the appraisal interview’.

We have already seen that two of the difficulties affecting managers in conducting effective performance appraisal are a lack of role clarity, as to whether they are primarily judges or helpers; and an inability to adopt the range of skills required to conduct different types of appraisal interview. A third difficulty for managers is the fact that organisations are social organisms, and that performance appraisal does not take place in isolation from these social processes. Managers and employees have to continue working together after an appraisal meeting has taken place, so managers may be reluctant to address shortcomings in performance in case this damages the working relationship. Job-holders may feel similar concerns; as Grint ominously points out, ‘…as far as the assessment process is concerned, we are what our superordinates say we are’ (Grint 1993: 831). He goes on to state

…it is not what the appraised thinks has transpired which accounts for his or her subsequent reward package, it is what the appraiser thinks that carries more weight – and with the weight the reward or the punishment.

(Grint 1993: 834)

This raises the issue of the relationship between performance appraisal and pay. The theory behind closely linking performance appraisal with reward systems was that desired performance would be encouraged and rewarded. However, the reality seems to have been that appraisers have tended to mark most people as ‘just above average’, so they get the performance pay, while appraisees have towed the line and kept quiet about their development needs in case they are marked down. The close association between performance appraisal and pay has therefore adversely affected the potential for performance appraisal to be developmental in nature. Recognition of this may be reflected in the results of surveys conducted by the (then) Institute of Personnel and Development (IPD). In their 1991 survey 74% of responding organisations had some form of performance-related pay, but by the 1999 survey this had fallen to 43%. In contrast the use of personal development plans (PDPs) was not mentioned in 1991, but was cited as a key feature of performance management by 68% of respondents in 1999.

Does this suggest that organisations are moving towards a more developmental approach to performance appraisal? Certainly the above figures would suggest this is the case, a view supported by a research project carried out in 1999 by CLMS, where the training managers taking part in the study commonly viewed the identification of individual training needs as a major outcome of the appraisal process. CLMS cite some specific examples from the study; firstly Kent County Council, where each individual has a PDP made up of an action plan and a performance review, followed by individual development planning. The second example is Eastbourne College of Art and Technology, where appraisal emphasises development and career progression as opposed to just performance and pay. A similar shift in emphasis has taken place in Control Risk Group, where clear links have been established between organisational objectives, core competencies and individual development needs.

The reference to competencies here is interesting. Redman, Snape and McElwee (1993: 6) suggest that ‘the increasing emphasis on competency offers some prospect of relating the performance appraisal process to actual behaviour’. In the 1999 IPD survey 31% of respondents stated that they used competence assessments, a figure which is likely to have increased since that time. Competence assessments had not been a significant factor in the 1991 survey (CLMS 1999a: 1239).

There are a variety of definitions of ‘competence’ and ‘competency’. CLMS define the difference between the two as follows:

Competences define the performance outcomes in terms of correctly completed processes or work products; competencies more generally describe personal attributes or sometimes behaviours.

In reality the position is clouded by the fact that the two terms are often used interchangeably. For example, the British Court Service has what it calls a ‘Competence Framework’, but many of the statements it contains describe the personal attributes and behaviours that CLMS define as ‘competencies’.

The National and Provincial Building Society defines its competencies as ‘the knowledge, skills, attitudes and behaviour which are required to effectively carry out roles within N&P’ (Armstrong 1995: 49). They are described in terms of behaviour: ‘what an individual is seen to do, or what the role holder should be able to do’ (Armstrong 1995: 50). This is a common definition of competencies and, if the competencies are properly researched and well drafted, has several benefits. They describe those key aspects of performance which were previously difficult to quantify and measure, such as interpersonal skills. This assists appraisers in identifying what constitutes effective and ineffective performance, and what constitutes a development need. Access to the competencies is available to all, so job holders not only know the criteria they will be assessed against, but can assess their own performance and identify their own development needs. They can even assess their managers’ performance, through upward appraisal or 360 degree feedback systems.

Theoretically, then, the advent of competencies should increase employee involvement in their own appraisal and development. This accords with Armstrong and Baron’s first key assumption of performance management, that people will work most effectively when they not only know what is expected of them, but also have some say in formulating it. However, this principle is not always applied in practice. A competence-based development programme for managers at Manchester airport specified that

The thrust of the exercise would be to focus on what was needed, rather than what the individual selected as a development need (in our previous experience, these rarely coincide).

(Jackson 1991: 1224)

The author later mentions that the programme was met with initial apathy and hostility, although he does not connect this with the complete disregard of the participants’ own views. He goes on to stress that the development programme must lead to improvement in individual job performance, as measured against job-related targets. The key message for participants in the programme is that ‘development and performance are one and the same thing’ (Jackson 1991: 1228).

This is an example of development being offered in a highly controlled way. Development in this context is not about personal growth, as stressed by the ‘soft’ approach to HRM, but solely about increasing the individual’s ability to contribute to the business.

Alongside the increasing use of competency-based approaches to performance appraisal over recent years has been the introduction of multi-rater systems, more commonly referred to as 360 degree appraisal. This again moves away from sole reliance on the judgments of supervisors, encompassing assessment of performance from subordinates, colleagues and, in some instances, customers. There are many benefits of adopting this approach. The employee gains a broader picture of how they are seen by others. The problem of over-reliance on a single reporting officer’s perceptions are addressed, as 360 degree appraisal inevitably brings a range of views from which key themes can then be identified. It is often a highly developmental approach, as subordinates, colleagues and customers are able to highlight development needs which may have been outside of the awareness of the employee’s line manager (Armstrong and Baron, 1998).

One of the concerns expressed about 360 degree appraisal has been that subordinates may not be equipped to comment on some areas of their manager’s performance. While this may be true in relation to technical matters, they are often best placed to comment on leadership and inter-personal skills, particularly following the introduction of competencies. There may be an element of self-preservation in managers resisting 360 degree appraisal on these grounds; as Kiechel (1989:202) puts it ‘most managers pride themselves on their people skills. Alas, subordinates may have a different view’ (cited in Grint 1993: 832).

Other drawbacks to 360 degree appraisal are that it can be complicated and expensive to administer, meaning that it is generally only offered to people in management roles. So it may result in a more developmental approach to performance appraisal for people at these levels, but not necessarily those lower down the organisational hierarchy.

The final area I wish to explore in considering whether performance appraisal is primarily an instrument of development or control is that of organisational change. As the structures of organisations change, so do the means by which they control their employees. Modern organisations have tended to move towards more flexible work patterns and less direct forms of supervision. Hierarchies are flatter and workers have been ‘empowered’ to take more responsibility for their own performance. As this means that these employees will need greater scope for decision making, unnecessary bureaucratic rules and regulations have been removed.

In the light of these developments, how can organisations continue to control their employees and ensure that their efforts remain directed towards the effective achievement of organisational goals? According to Townley (1995), the answer lies in establishing a strong corporate culture, where the organisation’s aims and espoused values are ‘internalised’ by employees. One of the ways in which these aims and values can be promoted is through the appraisal process. In their summary of Townley CLMS write

…in addition to evaluating performance, appraisals can be used to communicate organisational culture and objectives. Work habits, attitude and other personal traits can therefore be passed on through appraisal.

Townley’s views suggest that performance appraisal remains a way of controlling employees. The form of control is less direct than those used in the past, but may be more insidious as a result.

In this paper I have explored a number of issues relating to the practice of performance appraisal. I began by considering definitions of appraisal, which tend to focus on its role as a process for judging employee performance. I then considered the historical development of performance appraisal, which again has tended to focus upon judging and controlling employee performance. The extent to which this remains the case depends upon the organisation’s prevailing approach to HRM and performance management; whether they lean towards the ‘soft’ HRM of the human relations school or ‘hard’ HRM, with its roots in scientific management. Whatever the philosophical standpoint, performance appraisal is often left in the hands of line managers and is therefore subject to their attitudes, which may be at odds with those espoused by their organisation, and their skills, which may limit the effectiveness and range of appraisal. The nature of appraisal has also been influenced by changes in HR such as the rise and fall of performance pay, the development of competencies and 360 degree appraisal. Wider organisational change has also impacted upon appraisal, leading writers such as Townley to suggest that a reduced emphasis on rules has led processes such as performance appraisal to become mechanisms which are predominantly used as means of control.

The evidence in this paper suggests that performance appraisal can be seen as a means of both developing and controlling the employee, but that the development aspect is often narrowly defined. As the Manchester airport case study highlights development needs may be defined by the organisation, with little or no input from the employee, and may focus solely upon improving organisational performance. This is development of a kind, but hardly amounts to the vision of the learning organisation where development is valued for its own sake, and employees are nurtured and encouraged to fulfil their wider potential.

This article was derived from Steve’s MSc dissertation on competency frameworks in the government sector. It was originally published on the National School of Government Big Learning Event website: Big.Learning@nationalschool.gov.gsi.uk

Most large organisations, in both the public and private sectors, have ‘competence’ or ‘competency’ frameworks. However, many managers in these organisations remain unclear as to the purpose of these frameworks, and how they should be applying them. They struggle with the notion that the same sets of behaviours are deemed equally relevant to everyone throughout their organisation. They also struggle with how they are expected to utilise the frameworks in practice. Are they primarily developmental, a set of behaviours which employees should aspire to; or are they a set of basic requirements, against which employees should be appraised, and if necessary, disciplined?

In a 1995 article entitled ‘Demystifying Competence’ Michael Armstrong asked

…what does competence mean? It is all very confusing. Every definition is different. We hear about competences and competencies and are told that competence is quite different from competency and the two terms should never be confused (try telling that to a line manager).

(Armstrong, 1995: 49)

I believe that the distinction is important, but that over ten years since Armstrong’s attempt to ‘demystify competence’ confusion still reigns.
What, then, are the differences between the two? Whiddett and Hollyforde (2003: 5) offer the distinction that an ability based on work tasks should be referred to as a ‘competence’, while an ability based on behaviour should be referred to as a ‘competency’. So an example of a competence would be ‘Dealing with enquiries’, which could be demonstrated by performance indicators or outputs such as ‘Accurately completes enquiry forms’ or ‘Replies within agreed deadlines’. An example of a competency is ‘Interpersonal effectiveness’, which is specified by behavioural statements such as ‘Adapts style of interaction to take account of feelings of others’. The competency is broader, something which can be demonstrated in a wider range of situations than the competence, which relates to the requirements of a particular role or job.

The Chartered Institute of Personnel and Development (CIPD) offer the following distinction:

’Competency’ is now generally defined as the behaviours that employees must have, or must acquire, to input into a situation in order to achieve high levels of performance, while ‘competence’ relates to a system of minimal standards or is demonstrated by performance and outputs.

(CIPD, 2004: 1)

The implication here is that ‘competency’ is something aspirational, behaviours to aim for which, if achieved, will result in a high level of performance. If we accept this distinction then the development of ‘competencies’ may be seen as a quest for excellence. ‘Competence’, on the other hand, is simply a statement of the lowest level of performance which may be considered acceptable.

Hedges (1996) also defines competency in terms of superior performance:

A competency is a skill or characteristic of a person which enables him or her to carry out specific actions at a superior level of performance.

(Hedges (quoted by Hyde), 1996: 4)

The reference to a ‘characteristic’ recalls the definition of competency offered by Boyatzis in ‘The Competent Manager’ (1982):

A job competency is an underlying characteristic of a person in that it may be a motive, a trait, a skill, an aspect of one’s self-image or social role, or a body of knowledge which he or she uses.

(Boyatzis, 1992: 260)

Woodruffe (1992) suggests that much of the confusion as to what competency actually means may stem from definitions such as this. While the significance of Boyatzis’ work is not in question, psychological terms such as ‘traits’ and ‘motives’ are often not understood by practitioners. Woodruffe therefore offers a definition of his own:

A competency is the set of behaviour patterns that the incumbent needs to bring to a position in order to perform its tasks and functions with competence.

(Woodruffe, 1992: 17)

This definition makes a link between ‘competence’ – carrying out a specific job, and ‘competency’ – the transferable behaviour patterns which enable the individual to demonstrate competence in a range of different situations. Woodruffe describes these sets of behaviour patterns as ‘behavioural repertoires’ (Woodruffe 1992: 17), the range of capabilities, processes, actions and responses which enable some people to adapt more effectively to a range of work situations than others. Kurz and Bartram (2002) take up this notion of a ‘behavioural repertoire’ and offer the analogy of a musician, with a repertoire that covers a range of styles and types of music. They describe the musician’s performances as

… a consequence of his or her competency as a musician. This competency is not the same thing as the performances, but it is what enables the performances to occur…

The nature of the musician’s competency lies not just in the individual performances, but also in his or her ability to generalize and to transfer knowledge and skills from one job task to another.

(Kurz and Bartram, 2002: 230)

Kurz and Bartram concur with Woodruffe’s definition of competency as a set of behaviour patterns. This behavioural view of competency contrasts with the earlier, more psychological, traits-based approach of Boyatzis, and may be seen as supporting the charge that competency-based approaches perpetuate a narrow, behaviourist view of human development.

Kurz and Bartram also support Woodruffe and Whiddett and Hollyforde in their assertion that competencies should be specified in “action” terms. They illustrate this by stating that ‘Leadership’ is not a competency, but that ‘Providing Leadership’ is. The competency would then need to be supported by statements specifying the types of behaviours we would expect someone to exhibit while providing leadership, such as ‘listening to their subordinates’ or ‘demonstrating the ability to take difficult decisions’ (Kurz and Bartram 2002: 230).

What seems to emerge from this range of definitions is that a ‘competence’ is a statement of what someone needs to do to carry out a specific task or job. The ‘competence’ expressed will often be the minimum acceptable standard. ‘Competency’, is wider in scope, seeking to identify the range of behaviours (the ‘behavioural repertoire’) which will enable an individual to perform to a high standard in a range of situations. Competencies are therefore both transferable and aspirational. They should be expressed in ‘action’ terms, identifying the behaviours which require to be demonstrated.

As both Woodruffe and Whiddett and Hollyforde highlight, confusion is particularly likely to arise when ‘competences’ and ‘competencies’ are mixed up in the same framework. My own research into the use of competence and competency frameworks in the government sector suggests that this is quite common. So how did this state of confusion come about?

Miller (2001: 83-4) highlights differences of approach between the UK and the USA. In the UK a system has evolved which focuses on ‘competence’, in which the word ‘competent’ signifies that someone is performing their job in a way which reflects current standards of practice. In the USA, however, the focus is on ‘competencies’, which distinguish between ‘good’ performance and ‘exemplary’ performance.

When these two approaches are mixed up, and then used as part of the same HR systems, both become diluted and the distinct benefits of each approach are lost. For example, a candidate with an ‘exemplary’ behavioural repertoire may be passed over for a job in favour of a more limited candidate, because equal weight is being given to narrow job-specific competences. Unfairness may also arise in appraisal, where employees with a wide-ranging behavioural repertoire may fare no better than more limited employees who demonstrate ‘competence’ in their present job.

These examples demonstrate that what may seem like a purely academic debate can have serious implications for people’s working lives and careers. HR practitioners therefore have a responsibility to promote a clear distinction between ‘competence’ – minimum acceptable standards of performance - and ‘competency’ – the behavioural repertoire underpinning excellent performance. Organisations need to become clearer about which type of framework they have, and how they want their employees to apply it.

Steve Amos
May 2006

References
Armstrong, M (1995) ‘Demystifying Competence’. In Human Resources, November/December 1995, pp 49-50

Boyatzis, R (1992) ‘Building on competence: the effective use of managerial talent’. In G Salamon (ed.), Human Resource Strategies. London: Sage pp 260-272

Hogg, C (2001) Competency and competency frameworks. London, CIPD [online]. Available: http//www.cipd.co.uk/subjects/perfmangmt/competnces/comptfrmwk.htm

Hyde, S (1996) ‘Adopting a competent approach’. In Briefing Plus, May 1996, pp 4-5

Kurz, R and Bartram, D (2002) ‘Competency and Individual Performance: Modelling the World of Work’. In Robertson I, Callinan M and Bartram D (eds), Organizational Effectiveness: The Role of Psychology. London: John Wiley & Sons, pp 227-255

Miller, L (1999) ‘Editorial’. In International Journal of Training and Development, 3 (2), pp 82-89

Whiddett, S and Hollyforde, S (2003) A Practical Guide to Competencies, London: CIPD

Woodruffe, C (1992) ‘What is meant by a competency?’. In Boam, R and Sparrow, P (eds), Designing and Achieving Competency. Maidenhead: McGraw-Hill, pp 16-29

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