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Why We Hate Performance Management Essay

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Business Horizons (2011) 54, 503—507



Why we hate performance management–—And why
we should love it
Herman Aguinis *, Harry Joo, Ryan K. Gottfredson
Kelley School of Business, Indiana University, 1309 E. Tenth Street, Bloomington, IN 47405-1701, U.S.A.

Strategic goals;
Human resources

Abstract Individual performance is a building block of organizational success. Not
surprisingly, virtually all organizations have in place some type of performance
management system. Yet, managers and employees are equally skeptical that performance management adds value; usually, it is seen as a waste of time and resources.
We argue that the potential benefits of performance management are not realized
because most systems focus exclusively on narrow and evaluative aspects such as
performance appraisal. Herein, we offer a broader view of performance management, including discussion of how it differs from performance appraisal. We highlight
specific and important benefits of performance management for employees, managers, and organizations. We also describe research-based conclusions regarding how
performance management systems should be designed and implemented to realize
these benefits. We hope our article will demonstrate that well-constructed performance management systems should not be hated, but rather embraced.
# 2011 Kelley School of Business, Indiana University. All rights reserved.

1. Introduction
As noted by former Siemens CEO Heinrich von Pierer,
‘‘whether a company measures its workforce in
hundreds or hundreds of thousands, its success relies
solely on individual performance’’ (Bisoux, 2004).
This view is held by many; Heinrich von Pierer is
certainly not alone in this train of thought. Results of
a survey including senior executives from the Sunday Times list of best employers in the United
Kingdom indicated that...

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