Regarding "Pay for performance hammered at House hearing," one reader writes: I worked for a pay-for-performance system for many years in private industry. Setting objectives and means of measurement are the critical elements. You must reward the behavior that you are trying to achieve -- beware of unintended consequences!  Organizational goals need to be set from the top down, with traceability of objectives/accomplishments from the bottom to the top. The lack of a financial or profit motive in government makes pay for performance problematic because you are not competing against another organization, so it tends to foster more internal competition. That internal competition for the extra pay (and recognition) may readily become destructive of teamwork and common goals, if not properly managed.

To be effective, top performers should see a substantial reward (at least 20 percent). A token bonus ($3,000 to $5,000) will not change behavior in any substantial way. Most pay-for-performance programs are zero sum games, whereby every person receiving above budget treatment must be balanced by someone receiving less than budget treatment. This can be very destructive of organizational morale. 

Regardless of how well management sets goals and appraises performance, an element of subjectivity will be inherent in the process. The absence of objective measurements of success: sales, revenues, profits, etc., inherent in the government, means that pay for performance is an individual and personal assessment between the boss and subordinate. In addition to teamwork, this process can also be destructive to management and worker relationships, and diminish the collaborative environment that we should be working toward in the information society.

Anonymous

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