Thoughts on ways to improve the management of professional services firms

Thursday, August 16, 2007

The Problem with Performance Agreements - Limiting manager freedom

In my first post in this series, I talked about some of the problems associated with performance agreements. I now want to extend the argument, focusing on one issue, the way in which performance agreements inevitably limit the freedom of the manager.

The need for good management has never been greater. Yet I sometimes feel that management as such is becoming a lost art, submerged on one side in the current obsession with leadership, on the other in a plethora of limitations.

Management does involve leadership, but leadership is only one element of the manager's core role, getting the best results from the people and other resources at his or her command. It may sound trite, but the real role of the manager is just that, management.

I feel strongly on this one because over the last two decades I have watched a real decline in management roles and skills across a number of different organisation types in both public and private sectors. This may sound extreme, but in some organisations management in the old sense of the word has actually vanished, replaced by a reliance on systems.

The systems based command and control organisation works in the sense that the organisation still operates, but this comes at a cost in both human and business terms.

By its very nature, management is a bit messy. Needs change, priorities shift, crises arise. Further, any manager worth his or her salt generates new ideas while working. Sometimes, often, these are a little outside current ways of working simply because they are new. A good manager tries to test and introduce new things, in so doing working around and through existing systems.

Performance agreements can be used to stop all this type of nonsense by limiting the manager to the specified and the known. Further, in a world of cascading agreements where the manager's staff are also on agreements, those staff agreements have the useful effect of further limiting the manager's capacity to do new things by also limiting staff activity to the agreed and the known.

The command and control approach can sometimes be remarkably efficient in getting specific defined things done. It is much less effective when it comes to doing things or solving problems that fall outside neat pigeon holes, often hopeless when it comes to something new.

A key difficulty from my perspective with the application of performance agreements in a systems based command and control environment is the way it de-skills managers. Management now centres on the management of performance agreements and the performance agreement process. "Managers" who have grown up in this type of environment often lack the basic skills necessary to manage in a broader environment. Worse, they may not even recognise this lack.

Performance agreements need not be like this. It's just that the standard performance agreement process seems to drive them in this way.

Introductory post. Next

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