Why Can’t Metrics be Used for Performance Appraisals?

While discussing collection and usage of metrics, one often hears an emphatic “We should not use metrics for individual performance management!”. The statement is made as if it is an unquestionable tenant of the religion called process management.

“And pray, why not?” Why should the performance management process be deprived of metrics? A process oriented organization would definitely not like to boast that their performance management system is completely subjective.

Here are some reasons why metrics should be used for individual performance management.

*    An individual performance management (including the appraisal part) needs to be SMART – the “M” stands for measurable.

*    Most individual performance parameters are the similar to and derived from the project, product and process objectives, they typically relate to cycle time, quality (defects), meeting commitments (schedule) and productivity (cost, effort and usage of resources).

*    A strong metrics system, that provides accurate, precise and valid data can support the project, process and individual performance management requirements.

*    Using the same sources of data, we can create a more aligned organization – the individual objectives are aligned to the project, product and process objectives. In this manner, individuals know that meeting their individual goals helps in meeting the other goals (and vice versa); conflict of interest is minimized.

The situations where we may not want to use process/ project metrics for managing individual performance are:

*    The metrics collection system is not stable, and there questions on the credibility of the data. In such a case, the use of the data for managing the project/ process is also diluted.

*    Usage of the data for individual performance management may make the individuals sabotage the process and the accuracy of the metrics. In which case, we need to strengthen the process and make it sabotage proof.

In the old SW-CMM® days, most metrics collection systems were unstable, and hence many experts of that time were pretty insistent on the metrics not being used for performance appraisals – some organizations even have policy level statements for the same!

We have now moved on from the SW-CMM® days for process management, so we need to move on in other aspects too.

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