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Back to the Future? Performance-Related Pay, Empirical Research, and the Perils of Persistence

Susan Notes:

This is a brief excerpt from pp 11-12 in a 31-page article, available at the url below. We should continue to ask for the evidence supporting so-called merit pay.

by James L. Perry, Trent Engbers, and So Yun Jun, Indiana University-Bloomington

. . . The results of our research synthesis confront us
with a puzzle: performance-related pay continues to
be adopted but persistently fails to deliver on its
promise. What accounts for the persistence not only
of the failure of performance-related pay but for repeatedly
pursuing a failed course of action? An institutional
explanation for the persistence of public
jurisdictions to adopt performance-related pay begins
with an argument originating in sociology. Sociologists
argue that organizations that confront uncertainty
about performance criteriaâ€"and public
organizations typically are offered up as exemplars
for such uncertaintiesâ€"seek alternative ways to justify
or legitimate themselves to external stakeholders.

In lieu of definitive evidence of high performance,
public organizations will either acquiesce to external
demands about what is "good management" or
seek proxies to signal to stakeholders that they conform
to how effective organizations behave (Di-
Maggio and Powell 1983). The result of such
processes is that organizations tend to become more
alike, or isomorphic. Thus, public organizations
adopt performance-related pay because they are
coerced (i.e., "coercive" isomorphism), because
they seek to mimic private practices (i.e., "mimetic"
isomorphism) that have achieved high degrees of
legitimacy across society (Meyer and Rowan 1977),
or because they seek to conform to professional
standards or social norms (i.e., "normative" isomorphism).
The 1978 adoption of merit pay in the federal
government was clearly the result of mimetic
isomorphism. When founding U.S. Office of Personnel
Management director Scotty Campbell was
asked why he had not provided for experimentation
prior to government-wide implementation, his reply
was simple: "I saw no need. It was my perception
that it worked fine in the private sector" (Ingraham
1993a, 349).

Press accounts leave little doubt that the latest round
of performance-related pay adoptions is the result of
coercive isomorphism. Politicians who press for
performance-related pay see it as a mechanism to
call bureaucrats to account, to punish them for noncompliance
with politicians' preferences, and to
make them conform to public and political expectations. . . .

— James L. Perry, Trent Engbers, & So Yun Jun
Public Administration Review
2005-01-
http://www.aspanet.org/scriptcontent/custom/staticcontent/t2pdownloads/PerryetalArticle.pdf


INDEX OF RESEARCH THAT COUNTS


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