Performance management- consequence of poor performance management

Consequences of Poor Performance Management
There are countless examples that illustrate the dysfunctional consequences of poor performance management. One example I particularly like comes from an airport - a complex organization with different business units. Here, key performance measures were developed for the different functional areas of the airport. On the arrivals side, customer satisfaction is equated to channeling passengers thought the airport as quickly and conveniently as possible. What customers want is that once the plane has landed it quickly reaches its final parking spot, passengers get off the plane and swiftly pass through passport control, collect their luggage, and easily reach their transport links for their onward journey.

Consequences of Poor Performance Management
A key factor for success therefore is the amount of time it takes to get the luggage off the plane and onto the conveyer belt in the luggage reclaim area. Luggage handlers were therefore given a measure and a target of fifteen minutes. The way it was measured was easy since data was available about landing times as well as operational data from the conveyer belts. The measured time therefore started once the plane landed and stopped once the luggage reached the conveyer belt and it started moving. Instead of focusing on customer satisfaction - the overall objective - the baggage handlers saw hitting the measurement target as a game.

They wanted to look good in their performance management review and therefore ensured that one of the baggage handlers took their emergency vehicle and raced up to each plane once it reached its final parking spot, then grabbed the first piece of luggage off the plane, raced back to the terminal, put it on the conveyer belt and started the belt. This explains why this team, on paper, outperformed all other teams at the airport. It also explains why we see so many single pieces of luggage going round on the conveyer belts of airports. Overall, it illustrates some of the dysfunctional consequences often caused by not understanding strategic performance management and its behavioral implications.

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