Deming's Observations on Performance Management and its Adverse Outcomes in Contemporary Organisations

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Professional Human Resource Management Practices
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“Performance review nourishes short-term performance, annihilates long-term planning,
builds fear, demolishes teamwork, and nourishes rivalry and politics”
Indeed, among many of Edward Deming’s observations, his observation on
performance management proves to be the most significant for organisations. William
Edward’s Deming was an American professor, lecturer, statistician and consultant widely
known for his famous observation made on performance management and total quality
management that is widely recognised by every nation’s organisations. According to Deming,
as stated in the above quote, employee’s performance can be influenced through the system
where they work in rather than personal factors related to individual person (Malik, 2018).
Putting succinctly, Deming’s observation states that individual performances can be reviewed
by finding out the reason what causes them perform within a system. Here it can be noted that
according to Deming, employees themselves remain unaware of their own performance level,
and if he is correct, employee’s performance is directly related to system where they are
working. This essay will further reflect upon similar findings made on Deming’s observations
on performance management along with finding out how its adverse outcomes are being
addressed in contemporary organisations as well as what necessary HRM skills must be
employed to avoid performance management related issues.
One of the reasons for introduction of performance management theory was that many
people and researchers wanted to gain recognition for expansion in quality and improvement
as seen in US manufacturing units during 1980’s. For instance, the authors of Reengineering
and Six Sigma had made practical examination of improvement in manufacturing area and in
other cases, complete redoing of activities were observed due to performance issues (Locke,
1996). Whatever was observed at that time, were described as vainglorious as everyone tried

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taking credit for it (Aguinis, 2013). However, the book on Reengineering was written much
professionally as compared to the others and provided researchers with unlimited results that
were marketed instantly. That movement ended where authors stated that Reengineering
could have worked more properly if only it had more prominent and knowledgeable authors.
Thus, Deming’s work became more easily accessible to people since it maintained integrity
and respect towards his observations and teachings (Kalpan & Norton, 2005).
Deming’s observation was basically spotted due to the fact that performance at that
time were usually assumed and rewarded merely on the basis of employee’s performance
rather than looking upon other surrounding factors that could have determined other
performance factors and how well does an employee could perform. Nevertheless, Nankervis,
et al. (2017) argues that Deming’s statement is often under-valued in contemporary
organisations as his contentions depends on his understanding about human psychology that
are based on weaker grounds. After all, his investigations lacked formal study and thus a
question may arise here, ‘How did he know?’ His theory can be proved effective in a case
for example, if an employee is provided with bad quality tools and thus performance
outcomes disparage regardless how efficient the employee is. On the other hand, if the same
employee is working in a different company with improper management, the employee may
again remain demotivated and unproductive.
With due respect to all the performance reviews made in scholarly articles, Deming to
some extent might prove true in his observance as poor performance reviews can impacts
employees’ emotions adversely, but certainly not as powerfully as he states. Deming,
undoubtably commented on what he was familiar with while he made investigation on
employee’s performance. Nevertheless, after evaluating contemporary organisational
demands for managing, appraising and developing workforce requires much more established
approach that can synthesize with organisational objectives (Schleicher, et al., 2018).

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Performance and quality management have become an integral part among contemporary
organisations to gain competitiveness in global marketplace. Performance management
approach introduced by Deming are used by various organisations to implement his theory
into their business operations and procedures primarily in functional areas only. The basic
reason behind implementing performance management techniques is to reduce errors that
occurs during manufacturing and servicing process, improving service or product quality and
while increasing customer satisfaction. Nevertheless, Gorenak & Ferjan (2015) argues that
application of performance management further varies according to the nature of business,
even if it is across similar industry.
In past few decades, global economy has undergone many changes with the advent of
global competition and the extent to which companies are affected by one another by some or
the other means. As technological advancements and innovation are becoming more
necessary to bring forth a critical change for obtaining competitive edge, quality and
performance effectiveness have become a significant factor that companies strive to attain
(Denisi & Murphy, 2017). The above statement is agreed upon by Aguinis (2013) also who
opined that performance management is an organisational philosophy that embodies notion
that management policies must consider integrating the idea behind customer satisfaction
through highly managed and skilled workforce.
Employees and supervisors generally are surrounded by ambivalent attitudes to show
their best to win performance appraisals. Where most of them recognises perceived benefits
in documenting, principles, communicating and goal setting areas of performances, others
remain frustrated concerning the fact that actual benefit is received only through performance
appraisals in organisation they are working in. According to Behery, et al. (2014), the
rewards and benefits of performance appraisals often appear overstated and thus the author
suggest that typical performance appraisal and development procedure depresses and