Towards a context-appropriate performance evaluation : the case of EFQM-affiliated organisations
A remarkable number of research are coming to suggest that the approach driving the current human resource (HR) performance evaluation in the organisations with a quality orientation is fundamentally in sharp conflict with total quality management (TQM) requirements. This inconsistency, in turn, impedes the transition to a stable total quality (TQ) environment, or actively encourages regression to the traditional ways. Are human resource management (HRM) departments meeting TQM requirements with a good foundation for measuring HR performance? Are the criteria that organisations traditionally have used in measuring HR performance sufficiently robust that they can still be applied to the TQM-driven organisations? This research project argues that, although some of the characteristics of the current HR performance evaluation continue to be applicable to the quality organisational environments, many are not. The research sketches out a way to think about the differences between TQM and HRM approaches to performance management for organisations with a TQM orientation. To this end, the initial research is built on the findings of the literature available in both areas of quality management and HR performance evaluation in order to establish the context for the following empirical work. Then, the study employed a mixed methodology design consisted of two separate but linked methods: a questionnaire survey and a semistructured interview survey. While over half of the organisations surveyed were awarded different quality prizes, and some of them have become popular and feature among the most successful companies in the UK, however, their HR performance evaluation systems continue to focus on the non-TQM measures for assessment of employees' performance rather than the ongoing task of renewing and revisiting these criteria compatible to the organisational context. Such focus may be insufficient as TQM-driven HR performance management expands beyond the traditional approach to HR performance evaluation. Also, as frequently cited in the literature, Deming (1986) established that 95% of variance in the performance is due to system factors. Very few organisations, however, have included such factors as their approach to identifying the variance in the performance. Instead, the survey results found 'management of individual performance' as the most agreed criterion of the performance evaluation systems in place; however, this is entirely opposed to the TQM philosophy. Further, the findings suggest that improvement of employees' performance, customer care, active involvement of employees, and approaching performance evaluation as a quality management effort are the most generally agreed components of a TQM-driven HR performance evaluation. Overall, the reality in respect of quality-focused HR performance evaluation is that, for the majority of the organisations surveyed, the experience of HR performance evaluation practices over the last two decades, is more like the performance appraisal that it was many years ago i. e. traditional HR performance evaluation. The findings indicate what Deming has said many years ago that performance evaluation practices - as the third of his seven deadly diseases - are a root cause of quality management problems. Attempts to redesign and administer the current performance evaluation systems in such a ways to resolve this problem have, so far, been unsuccessful. The conclusion, unpalatable though it may be, is that HR performance evaluation in the majority of surveyed TQM-based organisations is locked into a vicious circle of individual performance, control approach, HR dissatisfaction, and a low degree of success for TQM programmes. These findings suggest resurgence in the value attached to the HR performance evaluation, reflecting the heightened pressures faced by all types of organisations, particularly TQM organisations, in designing an HR performance evaluation congruent with the organisational context in the interest of both the TQM organisation and the employees. A TQM approach to HR performance evaluation, inspired in detail by TQM researchers, slightly appears to be shifting towards a more balanced outlook where all people in any organisational position will be responsible for quality, but that there is still a long way to go.