Performance-Driven Evaluation

Conceptual Overview

Organizations have always sought to achieve their missions in order to prevail and satisfy necessities; consequently, managers usually look to measure how employees, structures, and departments work continuously, guided by tangible objectives. PDE evaluation is an old practice that, in certain way, was initiated and applied by Frederic W. Taylor at the end of the 19th century. Taylor's analysis was focused on individual work at factories to identify the best way to develop an activity within a production process.

The main idea of PDE is to transform the behavior of personnel through the continuous and systematic measurement of performance of individuals and groups, redirecting their priorities from procedures to results and impacts. Usually, PDE seeks to motivate smart, high-quality work, where individuals and groups have certain degree of autonomy and discretion within a set of rules and norms, but in which a special emphasis is placed on achieving results and not only respecting rules or following procedures strictly. Equilibrium between control and motivation, supervision and autonomy, and certain levels of managerial discretion as long as results are achieved are some of the general values defended by PDE systems. Therefore, the evaluation of performance requires considering the integration of different organizational levels: individuals, groups, units, or departments, linking them with particular outcomes and integrating them in terms of achievement and current limits to good performance. Implementing PDE systems requires a high capacity to define concrete criteria and specific and understandable methods to operationalize, measure, and rank performance. PDE systems need to be viable, simple, and financially feasible in order to become not only a structure for supervision but also a system of information able to produce valuable feedback, relevant to acquire organizational knowledge and guidance for workers and managers to keep learning continuously. Control and learning are two difficult elements to combine in administrative action, so accountability is essential in the process of PDE, but the internalization of a high-quality behavior also is necessary for the system to work. It would be difficult to think of a PDE system exclusively based on distrust or a general concept of opportunism as the base of organizational behavior (as in principal-agent theory assumption).

Technically, a PDE requires the construction of conceptual chains capable of linking several sets of task, subgoals, goals, and ends, crossing the organization both vertically and horizontally in a systematic way. According to PDE advocates, the primary source of legitimacy of an organization are the goals and ends, so the manager should be challenged to transform these into specific products, achieved through a network and chains of subgoals, processes, functions, and activities that are interrelated and aligned with the mission of the organization.

Once the goals, variables, products, and factors to measure are identified, the behavior is directed toward performance and the real value achieved needs to be [Page 1236]measured in terms of gross or net performance. Net performance looks to assess performance relative to what it would have been in the absence of a certain program or behavior. The precision of measurement, the rewards assigned to individuals or groups and the definition of net outcome requires constant auditing and study. Frequently, measures are just made cumulative or gross because it is very difficult (or costly) in practice to measure net performance, making evaluation of net performance rarely utilized. Just imagine the required level of precision of measurement in certain tasks: it is easier to calculate the number of people attending an event in a queue than the number of people who were assisted and who solved their problem thanks to a quality performance or an innovative behavior by the event organizers. In terms of public expenditure, for example, it is simpler to present the amount of money assigned, say, to hospitals rather than prove a net improvement of children's health in certain parts of a country thanks to the action of a group or department.

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