Not only are the roles and purposes of many professional and knowledge workers difficult to assess, the formal lines of authority are often unclear or complex, lending further difficulty to the task of effective performance appraisal. An employee may have several bosses, as is the case with many secretaries, or an employee may be involved in a matrix-type organization that requires reporting relationships with several departments in the company. Higher-level employees may report to a governing board or be accountable to one or more external constituencies. Performance appraisals are very difficult to perform when the person doing the appraisal works only part-time with the employee or when a group of people, rather than an individual, must do the appraisal. Members of 21st Century organizations are likely to find themselves in complicated reporting relationships that require unique modes of performance appraisal.
Let me place another nail in the coffin of traditional performance appraisal systems. The effect that an employee has on an organization is very difficult to assess, especially when the person being evaluated is near the top of the organization. Graddick and Lane note that:v
Corporations today face dramatic and unprecedented change. . . . Marketplace demands are changing the roles of executives. Leaders today are under tremendous pressure to produce results and deliver value to their shareholders, customers, and people. Given the complexity and importance of these positions, assessing and evaluating executive performance has become a key question for modern firms. . . .
In many organizations, “performance reviews at senior levels are less frequent, systematic, informative, and useful,”vi than are performance reviews conducted with employees at lower levels of the organizations. Nevertheless, Graddick and Lane suggest that:vii
. . . executives may need performance reviews more than any other group in the organization due to factors such as the sophisticated and ambiguous nature of their jobs, the fact that their responsibilities and priorities tend to change often, the serious organizational consequences of ineffective performance at their level, and their typically high need for achievement, recognition, and career progress.
