A Brief History of Performance Management

October 12, 2016

A Brief History of Performance Management

Performance management is not a new concept. But on the whole, the way companies conduct appraisals has changed massively over the last 100 years – so we thought you might like to see a brief overview of Performance Management over the years.

Early 1900s: The Performance Appraisal’s Informal Beginnings

Several sources suggest that performance appraisals were invented by WD Scott as early as World War I. Although possibly the earliest documented use of performance appraisals, however, WD Scott’s system was not a widely-recognised concept, and it wasn’t until around mid-century that more formal appraisal systems became implemented by a large number of businesses.

1950s: Developing a Formal System

By the mid-1950s, formal performance appraisals were much more commonly known, with companies using personality-based systems for measuring performance. Towards the end of the 1950s however, an unease at these systems began to develop, as not only was there no element of self-appraisal, but the personality-based approach did very little in terms of monitoring performance – rather, it monitored the person’s inherited personality, instead.

1960s: Measuring Objectives & Goals

By the 1960s, there was a much greater focus on self-appraisal, and most performance appraisal systems were geared more towards looking at what an individual might be able to achieve in the future (as opposed to how competent their personalities appeared to be at the time of being assessed).

As the 1960s progressed, performance appraisals began to do a better job of actually assessing performance, by focusing more on goals and objectives, and including much more by way of self-appraisal. 

1970s: Finding Flaws

During the 1970s, there was a lot of criticism about how appraisals were being conducted, and several cases were even taken to court. A lot of this was down to how subjective and opinion-based most appraisal systems were, and so as the 1970s progressed, companies started including a lot more psychometrics and rating scales.

1980s – Early 2000s: Holistic Measures

The next 20 years saw an increase in companies focusing on employee motivation and engagement, which led to a more holistic approach to performance management and appraisals. Companies began measuring brand new metrics as part of their appraisal process, such as self-awareness, communication, teamwork, conflict reduction and the ability to handle emotions. Many of these are still very relevant in performance reviews to this day.

Modern Day Performance Management

In recent years, performance management has evolved even further, with many companies pulling down the traditional hierarchy in favour of more equal working environments. This has led to an increase in performance management systems that seek multiple feedback sources when assessing an employee’s performance – this is known as 360-degree feedback.

With mobile technology giving us more flexibility, and with more companies recognising the value of a great company culture, we believe that the definition of what good performance is will continue to shift, and that the people who drive an organisation will continue to have an even greater input into how their peers are assessed.