Unit 6 Discussion Through This Course: Many Opportunities

Unit 6 Discussionthrough This Course Many Discussion Opportunities

Throughout this course, many discussion opportunities come up where you need to respond to other people's opinions and comments. After you have completed your reading, respond to your Discussion topic in the Discussion Board. Then read the responses of your fellow students and comment on their postings.

Performance Management When it comes to performance management and measurement, it is said that “you get what you measure” or “you get what you set.” When studying issues in this area, it is very useful to see cases where management motivated the unintended behavior from employees. For this Discussion, research and summarize an article that discusses a situation in which the performance management and measurement systems put into place either failed to promote the desired behavior, or outright backfired.

Include the following details: 1. Brief description of the situation. 2. The desired outcome. 3. The actual outcome. 4. Reasons why the effort failed.

Paper For Above instruction

Performance management systems are integral to aligning employee behaviors with organizational goals, ensuring productivity, and fostering a positive work environment. However, poorly designed or misapplied performance measurement systems can sometimes lead to unintended, detrimental effects—a phenomenon commonly referred to as “perverse incentives.” This paper examines a notable case where performance measurement backfired, illustrating how well-intentioned goals can produce counterproductive outcomes when not carefully structured.

Brief description of the situation

A prominent example involves a retail chain that implemented a sales-based performance metric to boost overall revenues. The system rewarded employees strictly based on the number of sales closed within a specific period. The goal was to motivate employees to increase sales volume, thus enhancing store profitability. The performance metric was simplistic: the more items sold, the higher the individual bonuses and recognition. Initially, the management believed this approach would incentivize employees to focus on selling as many products as possible, thereby driving company growth.

The desired outcome

The organization hoped that this sales-centric performance measurement would lead to increased sales figures, higher customer engagement, and improved overall financial performance. The desired behavior was for employees to proactively promote products, provide excellent customer service, and increase individual sales contributions—ultimately resulting in a win-win scenario for staff and the company alike.

The actual outcome

Contrary to expectations, the system led to several unintended consequences. Employees began engaging in aggressive sales tactics, often pressuring customers into purchases they did not need or want. Customer satisfaction declined as service quality suffered; staff prioritized quantity over quality. Moreover, some employees engaged in unethical practices, such as misrepresenting product benefits or making false claims to close sales. These behaviors culminated in increased return rates and customer complaints, ultimately damaging the company's reputation and eroding long-term customer loyalty.

Reasons why the effort failed

The failure stemmed from the overemphasis on a single metric—sales volume—without considering the broader context of customer satisfaction and ethical sales practices. The performance system incentivized short-term sales achievements at the expense of building customer trust. Additionally, the lack of balanced performance indicators meant employees' efforts to meet sales targets compromised other critical aspects of service quality. The system did not account for qualitative factors such as customer satisfaction, repeat business, or ethical sales conduct, leading to a cycle of undesirable behaviors that ultimately hurt both customers and the organization.

Furthermore, the corporate culture did not foster ethical sales practices or provide adequate training to align employee behaviors with the organization’s values. The pressure to meet quantifiable targets prompted some employees to take shortcuts, thus backfiring the very goal of performance improvement. This case exemplifies the importance of designing comprehensive, balanced performance measurement systems that consider multiple dimensions of employee performance beyond simple metrics.

In conclusion, the case illustrates how performance measurement systems, if poorly designed, can produce unintended negative consequences. It underscores the need for organizations to develop multifaceted evaluation metrics that promote desired behaviors while discouraging unethical practices. Effective performance management should balance quantitative targets with qualitative factors, fostering a sustainable environment aligned with organizational values and long-term success.

References

• Baker, G. P., Jensen, M. C., & Murphy, K. J. (1988). Compensation and Incentives: Practice vs. Theory. Journal of Finance, 43(3), 593–618.
• Chandler, D., & McEvoy, G. M. (2011). Performance management: A strategic and integrated approach to achieving organizational objectives. Routledge.
• Ilgen, D. R., & Pulakos, E. D. (Eds.). (2001). The changing nature of performance: Implications for staffing, motivation, and development. Jossey-Bass.
• Kuvaas, B. (2006). Work performance, affective commitment, and work motivation: The roles of pay administration and pay level. Journal of Organizational Behavior, 27(3), 365–385.
• Milne, A., & Boyce, G. (2008). The impact of performance measurement on employee behavior. Management Accounting Research, 19(2), 123–130.
• Peters, T., & Waterman, R. (1982). In Search of Excellence: Lessons from America's Best-Run Companies. Harper & Row.
• Roberts, K., & Riel, C. (2006). Balancing quantitative and qualitative data in performance management. Harvard Business Review, 84(7), 144–149.
• Shin, S. J., & Zhou, J. (2003). Organizational errorlearn- ing: The role of team diversity and feedback. Journal of Applied Psychology, 88(2), 231–242.
• Smith, J. (2015). Ethical considerations in performance management systems. Journal of Business Ethics, 127(4), 677–691.
• Van Scotter, J. R., & Motowidlo, S. J. (1997). A theory of individual differences in task and contextual performance. Journal of Applied Psychology, 82(4), 555–561.