The Human Factor

Numbers don't tell much about how well workers perform.

In almost 50 years of working for and being associated with the federal government, I've read perhaps 100 articles that say government is finally going to get tough and demand rigorous performance evaluations that fit the statistical "normal distribution curve." Yet little has changed. Why? Because humans have not changed.

Normal distributions apply to inanimate objects, not to people. There is nothing normal about humans. About 75 percent of workers feel they are in the top 25 percent in terms of ability and performance. But government continually tries to design personnel systems that place a significant percentage in the bottom half. Consequently, people are unhappy.

The attempt to objectify what is a subjective by using numbers and scales has been a universal quest. It is how managers try to absolve themselves of the responsibility of judging another's performance. And work that involves the invisible process of intellectual activity cannot be easily quantified or accurately measured.

Because a scale has five levels, as opposed to the two in the vilified "pass/fail" setup, does not mean it provides a more accurate evaluation. Actually, it results in a less satisfied workforce. When I came into the system in 1958, the ratings were "outstanding," "satisfactory" and "unsatisfactory." In those years, about 5 percent were rated "outstanding," about 1 percent "unsatisfactory," and the remaining 94 percent "satisfactory." I did not sense much dissatisfaction with the process-which de facto was pass/fail with 99 percent passing.

Management specialists began to say some employees are more than satisfactory but not outstanding and some are below satisfactory but not unsatisfactory, so the system should recognize those differences by having a five-part scale. The assumption was that supervisors could accurately determine those differences. But they can't. The results were disastrous. People rated "satisfactory" in a system in which only 5 percent were "outstanding," considered themselves close to the top group. In the five-part system, they found themselves in the middle, the 50 percent range, and thus were unhappy because they thought they should be in the top 25 percent.

Performance evaluations based on such schemes are accepted in the private sector because supervisors can rationalize the objectivity of their decisions by referring to the bottom line of profit and loss. There is no such parameter in the public sector. Performance evaluation for pay purposes never works, yet the country values an association between the two. What can be done?

The civil service should consider the military model. Officers are evaluated every year, but development and performance is linked to future promotions. This combines career counseling and performance evaluation. Pay among officers of the same rank and the same time in rank is equal and advances through longevity and congressionally approved raises. Officers jump to a higher pay range when they are pro-moted, and must serve some minimum time in each rank. The promotion decision is made by a board of the officer's superiors, which moderates the friction that occurs when one individual evaluates another individual. The process still has the desired effect of promoting the best qualified, based on performance.

In the National Security Personnel System, for example, suppose an employee at the entry level band were given annual pay increases as voted by Congress and annual performance evaluations. At the end of some period-say, three to five years-the worker could be considered by a promotion board of his superiors who would look at his cumulative evaluations. If found qualified, the employee could move to the next level and enter a higher pay range. This process could be repeated through the next bands, with minimum time required before promotion increased for the higher bands. Longevity increases could be added to each band.

Under such a scheme, the assessment would take on the character of career counseling, mentoring and performance evaluation. It would allow managers to communicate expectations and provide feedback to employees. And since the promotion decision would be made by an impartial board, friction would be reduced. Pay for performance would come through promotions to higher bands, not annual raises.

To motivate the workforce and give managers discretion, the first five years on the job would be deemed employment-at-will, in which a person could be dismissed. This is not unlike the tenure process for college professors. At the other end of the career path, an employee would become eligible for optional retirement, much like the military's time limits on careers.

Managers might exert effort to retain retirement-eligible employees who are contributing effectively. But they could retire those whose performance has dropped off or whose expertise is no longer important to the organization. Age discrimination is not a factor because optional retirement is not mandatory. It might even give senior employees the incentive to remain current and productive if they want to stay, thus avoiding the "retired on the job" syndrome.

Employment-at-will and optional retirement would allow managers to tailor the workforce without reductions in force, which tend to get rid of the youngest employees. Such a system would retain the most productive employees through the career cycle and avoid ill-fated systems that attempt to treat humans as "normal."