Incentives and Performance Appraisals

[CTCONCEPT@aol.com]

Jim

This is something I obtained in e-mail traffic that might be worth a look. 

Byron Murray
Eugene, Oregon (the great NorthWet)
541-607-8702

Subject: Appraisals vs Awards

Delinking Awards and Performance Appraisals 
by 
Gary Koca

     A recent article by Brian Friel in Government Executive cites a recent
OPM report that concludes that agencies more and more are delinking awards
from performance appraisals. Believe me, you won't get any arguments from
this corner on the need to delink appraisals and awards.

     As we have said on several occasions, the designers of the 1978 Civil
Service Reform felt strongly that a sound personnel management system would
have a close link between performance appraisals and the resulting awards
based on those appraisals. On this issue, at least as it pertains to most
federal agencies, they were completely wrong. 

     Linking performance appraisals to awards only makes great sense when
you have clear, objective, quantitative performance standards for employees.
For example, I am guessing that Passport Office employees may be able to be
held to clear and objective standards on the number of passports a typical
employee should be able to process per day, what the error rate should be,
and even how long it takes to process a typical passport. Employees who
exceed the quantity and have lower error rates than what the standard
dictates can receive performance awards that are linked to those production
rates.

     For many employees of the federal government, however, performance
standards are difficult to determine and even harder to apply. How do you
evaluate the quality of service provided by a human resources specialist, a
benefits specialist with the Department of Veterans Affairs, or a park
ranger with the National Park Service? Because it is very difficult,
supervisors are left with the time<consuming task of determining the
appropriate amount of an award, an unenviable task and almost always a
lose-lose situation. 

     No wonder many agencies are experimenting with the pass/fail
performance approach to ratings, and many supervisors are much more
comfortable now with this process. Unfortunately, as we have seen from FPMI
Communications' surveys, most employees don't feel that being called a
"pass" employee is sufficient recognition for a job well done. As one survey
respondent said, "At our installation, we call pass/fail the 'you suck, you
don't suck' system."

     In a 1999 survey, only 31 percent of federal employees agreed that
recognition and performance awards in their agencies were based on merit,
and only 26 percent said their agencies define good performance. After all,
we know it when we see it, but don't ask us to define it. As a result, many
agencies are delinking appraisals from awards, and are using group awards
and on-the-spot cash incentives to recognize hard-working employees.

     Two examples cited in the report are worth mentioning. The Commerce
Department created an online system that allows managers to nominate
employees for awards via the Internet. It also boosted the amount of its
on-the-spot awards, known as "Cash-in-a-Flash," to a maximum of $1,000. The
Department of Veterans Affairs lets employees help decide who should receive
time-off, on-the-spot, and other awards. After all, co-workers are often in
a better position than managers to know who is really doing an outstanding
job for the agency, the government, and the taxpayer.

     Clearly, every organizational development expert agrees that the vast
majority of employees like to be recognized for doing a good job. Federal
employees are no exception. To retain quality employees, federal agencies
are going to have to do a better job than they have done in the past in
recognizing their outstanding employees. And it probably won't be the
performance appraisal system that allows them to make that link, no matter
what kind of appraisal system the agency has.
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