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The Drucker Difference

Yes, You Can Make Performance Reviews Worthwhile

A few weeks ago, the head of the federal Office of Personnel Management took on what for many people is the bane of organizational life: performance reviews.

When it comes to setting employee standards, giving appraisals, and rating and compensating people, the processes now in place across the government "have dehumanized management to a degree that we can no longer ignore," the office's director, John Berry, declared in a speech delivered at a major interagency conference.

Peter Drucker saw this problem long ago, and not just in the public sector. "For a superior to focus on weakness, as our appraisals require him to do, destroys the integrity of his relationship with his subordinates," Drucker wrote in his 1967 classic The Effective Executive.

For Drucker, in fact, assessing an employee's performance should always begin with someone's strengths, not with his or her weaknesses—an emphasis picked up decades later by Marcus Buckingham, Gallup's Tom Rath, and others. "The effective executive makes strength productive," Drucker asserted. "He knows that one cannot build on weakness."

And yet most traditional appraisal systems, Drucker explained, are based on the work of clinical psychologists. "The clinician is a therapist trained to heal the sick," Drucker noted. "He is legitimately concerned with what is wrong, rather than what is right, with the patient."

Behind a Murky Veil

This week's threat of a government shutdown aside, the federal performance-management system is full of idiosyncrasies, including a civil service bureaucracy that largely rewards longevity in a job. Most companies don't have to deal with such strictures or the messy politics often associated with them. But one frustration common to many enterprises—whether a business, government operation, or nonprofit—is the lack of transparency and consistency that people sense when they are evaluated.

"For many employees, performance standards are too unclear and subjective," Berry said. "And then you don't fully know what's expected of you or how you're doing." Among the reforms Berry is calling for the government to implement are detailed yardsticks that are "objective, aligned to agency mission and goals," and have true "employee buy-in."

Drucker certainly would have agreed with this approach. "One can measure the performance of a man only against specific performance expectations," he wrote, adding that the best kind of review begins with a statement of the key contributions expected from the employee, along with a record of how he or she has fulfilled these particular goals.

A Series of Questions

But Drucker didn't stop there. After analyzing how the worker has (or hasn't) met these objectives, the ideal appraisal in Drucker's eyes would ask a handful of questions, the first three of which would zero in on an individual's strengths: What has he or she done well? What, therefore, is he or she likely to do well in the future? What new knowledge or skills must he or she acquire in order to coax the full benefit from his or her strengths?

It is only the next set of questions that veers in a different direction: If I had a son or daughter, would I be willing to have him or her work under or alongside this person? If yes, why? If no, why not?

That's the entire form, top to bottom. "This appraisal actually takes a much more critical look … than the usual procedure does," Drucker wrote. But it concentrates on what people naturally do well and should do even more of. At the same time, it positions weaknesses so they are "seen as limitations to the full use" of an employee's talents, not as deficiencies that one needs to obsess over.

For all of his attention on the positive over the negative, Drucker was no softie regarding staff. He believed that employers should make every job as "demanding and big" as possible. That's because it's only when jobs challenge people that their full strengths emerge, he said. And only if there's scope will "any strength that is relevant to the task … produce significant results."

Those Who Don't Cut It

Drucker also had little tolerance for employees who've been put in a position to leverage their strengths but then don't execute. "It is the duty of the executive to remove ruthlessly anyone—and especially any manager—who consistently fails to perform with high distinction," Drucker wrote, in what surely counts among the least temperate passages in any of his 39 books. "To let such a man stay on corrupts the others. It is grossly unfair to the whole organization."

Berry made a similar point in his address, commenting that the government fairly but quickly should aim to get rid of those who aren't cutting it. "Failing to remove poor performers disrespects and demotivates the entire team," he said. "What's more, we don't have a position to waste."

Meanwhile, Berry suggested that the more than "80 percent of people who are doing a good job" should, in addition to a pat on the back, receive "frequent feedback about how they might improve further, and the training they need to get there." And supervisors should provide "greater opportunities to innovate" to the best performers. All of this, of course, echoes the build-on-strengths orientation that Drucker advocated.

Drucker was very skeptical of the federal government's ability to get things done. But in Berry's blueprint he would have seen some real signs of hope, earning the personnel chief high marks indeed.

Rick Wartzman is the executive director of the Drucker Institute at Claremont Graduate University.

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