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The Evolution of Performance Management: Searching for Value

Elaine D. Pulakos, Rose Mueller-Hanson, Sharon Arad

Human Resource Management Journal - January 2019

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Overview​

This article reviews the history of performance management (PM), beginning with performance evaluation. We discuss various strategies that have been used to enable accurate ratings as well as cognitive processes and contextual factors that have been shown to significantly impact ratings. We raise questions about the concept of true performance and whether raters can be enabled and motivated to make accurate ratings. We progress to discussing more structured and comprehensive PM processes that typically involve cascading goals, goal setting, competency modeling, evaluation of behavior and results, and implementation. These systems have proven to be tedious and low-value, resulting in unprecedented, wide-spread experimentation with innovative practices to move companies away from heavy PM processes to simpler, cost-effective strategies that actually drive performance. These have ranged from abandoning ratings to implementing innovations in goal-setting, real-time feedback, coaching, and PM behavior change. Directions for future research and practice are discussed.

Key ideas​

  • Performance management has moved through several eras: rating individual performance, building structured goal and competency systems, and now simplifying those systems so they actually help people perform.
  • A central problem is that ratings are not just measurements. They are shaped by rater judgment, motivation, cognitive bias, context, and disagreement about what "true performance" even means.
  • Heavily structured PM systems often add process without enough value. Cascading goals, competency models, formal evaluations, and implementation routines can become burdensome when they do not change day-to-day behavior.
  • The article frames the current experimentation around simpler practices: fewer or no ratings, better goal setting, real-time feedback, coaching, and explicit behavior change.
  • The strongest practical test for a PM process is not whether it feels complete on paper, but whether it helps managers and employees improve performance in the flow of work.

Practical use​

  • Keep ratings secondary to performance conversations, especially when the goal is development rather than administration.
  • Design lightweight rituals that make useful feedback more frequent, timely, and specific.
  • Treat any PM redesign as behavior change for managers and employees, not just a new form, cycle, or software workflow.

Original research: Open publisher page