While this article is predominantly about CSR, the exact same argument applies to "new work" and popular "alternatives to performance management" where proponents argue for more autonomy or meritocracy, but fail to examine the relevance of a hegemonic capitalist discourse or challenge the foundational "logic" of the existing economic system. Read on:

To explain the frequent failures of current CSR practices and to explore the possibilities of remedying them, I examine the close relationship between CSR, the persistent expansion of capitalism, and the pressure that capitalism puts on companies to legitimize their business operations. My analysis shows that the failure of CSR to serve as a corrective to the problematic effects of capitalism is, in fact, an inevitable consequence of the problematic dynamics of the capitalist system. On this basis, I suggest that capitalism limits the possibilities of making CSR more effective, argue for change on the systemic level of capitalism, and explore the ways in which CSR research can contribute to this political endeavor.

This is a rather brave article as the authors had to fight very rigid doorkeepers of the dominant paradigm. There is more follow-up research on this by all three authors and a cheeky short article from Meike and myself side here: https://www.corporate-rebels.com/blog/dark-side-of-okrs-and-why-we-should-care

Goal setting is one of the most replicated and influential paradigms in the management literature. Hundreds of studies conducted in numerous countries and contexts have consistently demonstrated that setting specific, challenging goals can powerfully drive behavior and boost performance. Advocates of goal setting have had a substantial impact on research, management education, and management practice. In this article, we argue that the beneficial effects of goal setting have been overstated and that systematic harm caused by goal setting has been largely ignored. We identify specific side effects associated with goal setting, including a narrow focus that neglects nongoal areas, distorted risk preferences, a rise in unethical behavior, inhibited learning, corrosion of organizational culture, and reduced intrinsic motivation. Rather than dispensing goal setting as a benign, over-the-counter treatment for motivation, managers and scholars need to conceptualize goal setting as a prescription-strength medication that requires careful dosing, consideration of harmful side effects, and close supervision. We offer a warning label to accompany the practice of setting goals.

In my speech I shortly allude to the transparency paradox - but that article is a hard read. Here is another one of Ethan Bernstein which also brings technology on top into the discussion.

Observation is key to management scholarship and practice. Yet a holistic view of its role in management has been elusive, in part due to shifting terminology. The current popularity of the term “transparency” provides the occasion for a thorough review, which finds (a) a shift in the object of observation from organizational outcomes to the detailed individual activities within them; (b) a shift from people observing the technology to technology observing people; and (c) a split in the field, with managers viewing observation almost entirely from the observer’s perspective, leaving the perspective of the observed to the realm of scholarly methodology courses and philosophical debates on privacy. I suggest how the literature on transparency and related literatures might be improved with research designed in light of these trends.

There is a similar article by Kluger/De Nisi in Journal of Applied Psychology but this one just makes for a much better read:

A wide range of systems for evaluating performance have been used in organisations, ranging from traditional annual performance appraisals to performance management systems built around informal, real-time evaluations, and these systems almost always fail. Rather than continuing to make cosmetic adjustments to this system, organisations should consider dropping the practice of regularly evaluating the performance of each of their employees, focusing rather on the small subset of situations in which evaluations of performance and performance feedback are actually useful. Four barriers to successful performance evaluation are reviewed: (a) the distribution of performance, (b) the continuing failure to devise reliable and valid methods for obtaining judgments about performance, (c) the limited utility of performance feedback to employees, and (d) the limited utility of performance evaluations to organisations. In this paper, I propose ways of managing performance without relying on regular performance evaluation, refocusing managers' activities from performance management to performance leadership.

Please consult also the articles on our team drive - many are behind a pay wall. I have chosen this one as it arguably depicts the biggest problem with high powered incentives. Read on:

The design of incentive systems is a central issue in the economics of organization. This paper argues that very often the ideal incentive systems to use within firms will involve low-powered incentives. Five particular circumstances leading to weak incentives being optimal are examined.

As Richard Posner (Reference Posner2010) demonstrates, a major issue in the economics of organization is the design of compensation and incentive systems. Footnote 1 Much of Posner's discussion focuses on CEO compensation, but the issue arises at all levels of the organization. Recent years have seen numerous calls to strengthen incentives within organizations, ‘bringing the market inside the firm’. The supposed advantages are that people will work harder and smarter if they are rewarded for results. As an economist, I do believe that people respond to incentives. Nevertheless, strong incentives are often a very bad idea, especially within organizations. In fact, strong, misguided incentives have played a fundamental role in bringing about the global economic crisis we are now experiencing. The problem is that people respond just as strongly to badly designed incentives as they do to well-structured ones. And when those badly designed incentives are strong, they can lead to really egregious forms of behavior, and the results then can be horrendous.

As I noted in my session, for me, the need for HR to be both strategic and people-centric (see my newsletter on multi-sided HR) is the most important paradox we face. This leads on to the need to both create organisation capability, and develop culture, which was the focus of my own session, and which I'll be reviewing in my newsletter early in 2024 (subscribe to learn more about this then). So it was interesting to also listen to a panel discussing the transformation of performance management which was on after me, touching on the needs to navigate paradox (eg managing both individual and team performance), and to support both culture and capability. However, what most struck me was that... https://lnkd.in/eVh97cZ6

In a world where the average person spends over 100,000 hours working, where more than 80% of adults deeply identify with their job roles, and where employment creates significant unhappiness, the imperative is clear—we must ensure that work becomes a positive force for as many people as possible.

I've been thinking about whether, if there is a growing opportunity to shift from a top-down, measurement based, compliance focused system of performance management towards a bottom-up, human and commitment focused approach that I've called performance leadership, then whether it is time to start downplaying many organisations' emphasis on SMART (specific, measurable, achievable, relevant and timebound - or variations of this).