Total quality and the abandonment of performance appraisal: Taking a good thing too far?

Abstract

Proponents of total quality management often argue that performance appraisal is fundamentally at odds with quality-oriented management. This argument is made both on the basis of logical analysis and statistical demonstration. We show that neither of these arguments creates a compelling case against performance appraisal. We conclude that thoughtful organizations need to make decisions about performance appraisal in the same way that other business decisions are made, that is, in terms of a cost-benefit analysis.