Edwin Brenegar III wrote:
> Thou shalt not judge doesn't mean check your brain at the door. That is
> an invitation to disaster.
Ed, you mentioning brains has hit upon what is for me the central issue
when it comes to the successful application of employee ranking programs-
the cognitive capability of the people doing the ranking.
I worked in a large company where ranking was the pre-dominent means for
appraising the performance of employees. I found that many of my
contributions were neither recognized nor rewarded because of the bounded
rationality/ limited understanding of my managers. They were too busy, too
biased, not around, unable or unwilling to be accurate in setting the
rankings. Much of this activity was genuinely intended to be fair to and
reward accurately the people being ranked. The problem was that the "road
to hell is paved with good intentions".
This greater occurrence of the problem of "bounded rationality", i.e. a
limited understanding of events, should be recognized and avoided.
Employee ranking systems do indeed sound equitable in theory in that it
rewards employees on the basis of their performance rather than mere
presence in an organization. However, in practice, flatter organizational
forms render ranking schemes impossible to implement successfully because
of the diverse work that employees perform. Managers are too busy with
their own work to monitor their employee's output fairly and effectively.
Hence, because bounded rationality prevents the ranking system from being
effectively administered, simple pay plans should be retained.
The secret for managers (and politicians) is to "Be smart enough to know
you are not smart enough". They must have the self-confidence and
exercise the self-discipline not to intervene. Managers must recognize
their limited understanding of the unorganized world and respond by
letting strategies emerge, making reversible commitments and keeping
decision making vague.
Many of the challenges we face come from seeing a valuable and equitable
end and then trying to use an organized interventionist means to achieve
it. I struggle to find viable mechanisms to achieve these ends within the
flawed environment of organizations- I would rather use market forces
which signal and reward a person's effort.
For more information, see the "The limited understanding of managers"
section on "unorganization: The Business Handbook" at
http://www.unorg.com/bh.htm
regards sincerely Simon Buckingham http://www.unorg.com, unorganization:
business not busyness!
Unorganization Tour Denmark- 1st to 5th March 1998
--Simon Buckingham <go57@dial.pipex.com>
Learning-org -- Hosted by Rick Karash <rkarash@karash.com> Public Dialog on Learning Organizations -- <http://www.learning-org.com>