Performance Assessment in the Member States of the European Union, Norway and the European Commission Dr Christoph Demmke, Professor of Comparative Public administration, EIPA 20 June 2007

WHY THIS INITIATIVE UNDER GERMAN EU- PRESIDENCY? Work in HRM-Group focused on Performance Related Pay, Leadership, Public Performance (Lisbon), Ethics etc. Work in HRM-Group focused on Performance Related Pay, Leadership, Public Performance (Lisbon), Ethics etc. Very little interest in Performance Appraisal Very little interest in Performance Appraisal DG´s discussed Performance Assessment for the last time 1994 !! DG´s discussed Performance Assessment for the last time 1994 !! Since 1994 many reforms – a lot of good- and bad practices. Since 1994 many reforms – a lot of good- and bad practices. Great potential to learn from each other Great potential to learn from each other

Why was there a limited interest in the subject? For a long time, PA had little consequences – neither on pay, nor training, nor career development other policies For a long time, PA had little consequences – neither on pay, nor training, nor career development other policies PA not taking seriously, often not taking place, often once in two or more years PA not taking seriously, often not taking place, often once in two or more years Systems were highly bureaucratic and mathematical - „Objectivity turned into Subjectivity“ Systems were highly bureaucratic and mathematical - „Objectivity turned into Subjectivity“ No motivation on both sides – no interest in rating, no interest in being rated No motivation on both sides – no interest in rating, no interest in being rated Often too good appraisals in order to avoid problems Often too good appraisals in order to avoid problems Lack of knowledge and professionalism (attribution problems - what is influencing indiv. performance) ? Lack of knowledge and professionalism (attribution problems - what is influencing indiv. performance) ? No or not sufficient training No or not sufficient training Only formalised process, no discussion, no deedback, no communication Only formalised process, no discussion, no deedback, no communication Often hard and soft objectives in one appraisal Often hard and soft objectives in one appraisal

Times are changing - PA is becoming much more important? Introduction of performance related pay and other (immaterial) rewards. Appraisal is linked to pay and other rewards. Introduction of performance related pay and other (immaterial) rewards. Appraisal is linked to pay and other rewards. More direct impact on career planning and promotion More direct impact on career planning and promotion Appraisal is linked to training needs Appraisal is linked to training needs Appraisal taking place more often and regularly Appraisal taking place more often and regularly Not anymore seen as a formalised process, linked with discussions on annual targets, objectives, poor performance, feedback, communication Not anymore seen as a formalised process, linked with discussions on annual targets, objectives, poor performance, feedback, communication Impact of (negative) Performance on Job Security. Appraisal is linked to job security (although still rarely the case) Impact of (negative) Performance on Job Security. Appraisal is linked to job security (although still rarely the case) = TREND: PA HAS BECOME AN IMPORTANT MANAGEMENT INSTRUMENT

Two more trends..... Trend towards the Decentralisation of HRM- responsibilities to Managers Trend towards the Decentralisation of HRM- responsibilities to Managersand Trend away from standardised performance assessments towards individual performance targets and annual performance targets (Individualisation instead of Standardisation) Trend away from standardised performance assessments towards individual performance targets and annual performance targets (Individualisation instead of Standardisation)

Centralised and Decentralised HR policies in EU-Europe, Demmke/Hammerschmid,Meyer, 2006 centralised decentralised

More workload, more responsibilities – can Managers cope with this? Managers should assess performance more regularly Managers should assess performance more regularly Managers should assess both performance against objectives and what behaviours are being demonstrated Managers should assess both performance against objectives and what behaviours are being demonstrated Managers and jobholders should discuss the objectives agreed and whether they should be revised Managers and jobholders should discuss the objectives agreed and whether they should be revised Managers should review priorities Managers should review priorities Managers should discuss people management abilities Managers should discuss people management abilities Managers should give and record feedback Managers should give and record feedback Managers should improve people management Managers should improve people management Managers need to make time to discuss development needs, longer term career aspirations and options Managers need to make time to discuss development needs, longer term career aspirations and options Managers should assess whether good performance should be rewarded (pay, rewards, promotion etc.) Managers should assess whether good performance should be rewarded (pay, rewards, promotion etc.)

„Poor leadership“? The role of Managers Problem: Managers overestimate themselves, Problem: Managers overestimate themselves, Managers take too little training Managers take too little training Too little incentives („What is in for managers“ Too little incentives („What is in for managers“ Too little knowledge on „measuring performance. What determines indiv. performance? Too little knowledge on „measuring performance. What determines indiv. performance? No incentive to rate negative (...creating only problems) No incentive to rate negative (...creating only problems)

Ability to measure performance Availability of performance information Simplification of systems Motivation of superiors Motivation of staff Separation of hard and soft objectives Informing about the danger of subjectivity Avoid ratings that are too high Management issues Ability to set objectives Ability to measure performance Never 1234 Frequently Informing and training staff Convincing staff Training managers Time resources of managers 56 Judging by the experience in your administration, what are the most important challenges in the daily management of the personnel appraisal system?

Ability to measure performance Workload is too high No experience in setting objectives No training in the setting of objectives Culture is based on the principle of hierarchy Not important 1234 Very important Tasks and obligations changing rapidly Lack of trust between superiors/employees Continuous political influence on work No motivation on both sides 56 What are the most important challenges in setting and agreeing upon annual objectives (between employees and their superiors)?

The Leadership challenge Leaders need better incentives to carry out appraisals more professionally Leaders need better incentives to carry out appraisals more professionally Need to train managers on setting and revising objectives Need to train managers on setting and revising objectives Need to address (lack of) motivation Need to address (lack of) motivation Structural problems: Often, appraisals on top of work, no time. Appraisal is seen as less important. Structural problems: Often, appraisals on top of work, no time. Appraisal is seen as less important. How can superiors and employees be better motivated to carry out appraisals in more professional ways? How can superiors and employees be better motivated to carry out appraisals in more professional ways?

Other important challenges Member States enhance efforts to simplifiy systems Member States enhance efforts to simplifiy systems –Many best-practices and successes but „prices must be paid...“.

Do you think the workload of those involved in carrying out appraisals is increasing or decreasing?

What does „bureaucracy“ mean? – three representative answers Case Slovenia: „It demands a lot of time and intellectual efforts to set objectives, to transform them into concrete tasks, to discuss them with employees. Afterwards the work must be checked and evaluated...“ Case Slovenia: „It demands a lot of time and intellectual efforts to set objectives, to transform them into concrete tasks, to discuss them with employees. Afterwards the work must be checked and evaluated...“ Case Austria: „Though annual staff appraisals are a useful instrument, they result of course in an increasing workload; all appraisals have to be prepared carefully and the specific interests and skills of each member as well as options for career development have to be discussed“ Case Austria: „Though annual staff appraisals are a useful instrument, they result of course in an increasing workload; all appraisals have to be prepared carefully and the specific interests and skills of each member as well as options for career development have to be discussed“ France“ More bureaucracy s´il faut entendre par là une plus grande individualisation du management et un meilleur suivi des agents...“ France“ More bureaucracy s´il faut entendre par là une plus grande individualisation du management et un meilleur suivi des agents...“

Systems better managed than before More evaluations on effects of systems (interesting case is Ireland) More evaluations on effects of systems (interesting case is Ireland) More and better guidelines, information distributed on how to carry out appraisals More and better guidelines, information distributed on how to carry out appraisals Appraisals are carried out more systematic and more frequently Appraisals are carried out more systematic and more frequently More categories of staff are evaluated More categories of staff are evaluated More training on appraisals More training on appraisals More pressure for more communication between superior and employee More pressure for more communication between superior and employee

Do you think performance management systems are managed more professionally than 10 years ago?

Evaluation and Outlook Experiences with PA are comparable, also many similar reform results. Many good practices. Member States should be encouraged to exchange national experiences (in the study DK, Fin, UK etc.). Experiences with PA are comparable, also many similar reform results. Many good practices. Member States should be encouraged to exchange national experiences (in the study DK, Fin, UK etc.). –But: Member States reform systems within their own contexts –PA systems are linked to national systems and national organisational structures –PA systems in career systems are more designed towards promotion whereas in position systems more towards pay Member States should invest more in evaluating the effects of the systems (on costs, added-value, weaknesses, performance, disrrimination, fairness). Member States should invest more in evaluating the effects of the systems (on costs, added-value, weaknesses, performance, disrrimination, fairness). High degree of decentralisation allows for increasing variety of approaches (as regards notes, objectives, forms, assessment methods and criteria etc.) High degree of decentralisation allows for increasing variety of approaches (as regards notes, objectives, forms, assessment methods and criteria etc.) Decreasing use of standardised systems - Increasing use of individual performance agreements. New challenges in comparing performance ?? Decreasing use of standardised systems - Increasing use of individual performance agreements. New challenges in comparing performance ?? Progress but still considerable challenges, esp. Leadership issues, skills on how to set and to revise objectives Progress but still considerable challenges, esp. Leadership issues, skills on how to set and to revise objectives