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Coen and Jenkins offer a substantial body of evidence that challenges each of these assumptions and that calls into question most of the performance appraisal processes that are now being used. They note, for instance, that the ratings of employees will tend to be higher if the appraisal is being used for personnel decisions, such as salary or promotion. The ratings will tend to be lower if used for developmental purposes. Many other studies of performance appraisals support this conclusion.iv Coen and Jenkins also point to another widely acknowledged problem: the quality of appraisal tends to vary widely depending on the skill and training of the person doing the appraisal. There is little evidence to suggest that appraisals are neutral or unrelated to such biasing factors as age, gender or race.
In addition to Coen and Jenkins litany of problems, I offer a few of my own that have often been overlooked in the critique of performance appraisals. Performance appraisals are very difficult to conduct in many organizations because of what may be called professional autonomy. Social workers, dental assistants, faculty members, design engineers, nurses, elementary school teachers and computer analysts all operate as professionals, with varying degrees of autonomy. Even more broadly, the new knowledge workers that populate high tech firms expect and may even demand that no one be allowed to look over their shoulder while they are working.
Professionals and knowledge workers further argue that their product is often difficult to measure or, in many cases, even to specify. Hence, they question the value of any formal performance appraisal systems that tries to measure production in some quantitative fashion. The number and variety of jobs that are now being defined as professional seems to be increasing in our 21st Century society. Conversely, the number of jobs that yield readily quantifiable products seems to be on the decline. The so-called third sector (human services) is becoming much larger, at the expense of those sectors in which production is more easily measured.