When President Bush looked toward his embattled director of FEMA and announced to the world “Brownie, You’re doing a heck of job”, he epitomized one of the most frequent and damaging problems in corporate America today – the halo effect.

halo effect Not unlike thousands of managers everyday, President Bush patted his guy – Michael Brown, former director of Federal Emergency Management Agency – on the back for failing to do his job. This unfortunately all-too-common method of giving positive but undeserved accolades is the bane of managers everywhere. Known as the halo effect, managers tend to rate all employees as excellent, good, or acceptable regardless of actual job performance. Why would a manager take this tenuous path to performance management?

As his leader, the President wanted to stand behind his man, encourage his employee, and direct attention to the positives he was doing. He did the right thing too by not admonishing Mr. Brown publicly for the incredibly difficult and embarrassing position he placed his boss. Instead President Bush found ways, like he has done in the past, to support his team in moments of glory as well at times of crisis.

Bush also relishes loyalty and dedication. That is very likely how Mr. Brown got his job in the first place: payback for his loyalty and dedication. Both are admirable characteristics in effective leaders and good followers.

But like everything else there are consequences of every action.

The problem with Bush’s comments is that Brownie wasn’t doing a heck of job, an assessment expressed by nearly all observers. By publicly recognizing Brown for his efforts, Bush damaged his credibility with the residents of the Gulf Coast and the rest of the world watching one of his early communications. This is what happens when managers don’t deal with underperforming employees – they lose the endorsement and respect of co-workers and peers who experience the results of this poor performing employee first-hand. Morale takes a hit and followers cry out for strong leadership.

So why do managers choose the halo effect as the strategy of choice when evaluating employees’ performance. First the halo effect amounts to taking the easy way out. It’s simply easier to give a good appraisal than addressing performance problems and missed expectations.

Sometimes the halo effect has nothing to do with the employee’s performance and it has everything to do with the manager’s need to save face; you hired him you and admitting he failed means you failed

Rightfully so, you never want to embarrass or admonish an employee publicly for poor performance. A few managers go too far and President Bush might have crossed that line too. To demonstrate their support, managers throw around a few “atta-boys” and other words of encouragement hoping to jump start a nice-guy-in-the-wrong-job into their next super-star.

Timing has a lot to do with the halo effect, too. You’re faced with filling a vacancy and your long-awaited vacation is just a week away. You just don’t have the time to write a detailed performance improvement plan or deal with an unhappy employee, so you pad the appraisal with niceties to keep this employee in place until you have more time to concentrate on it. Then again, maybe he’ll quit first and you won’t have to be the bad guy after-all.

Regardless of the reason, the day of reckoning always comes when the employee bungles a job and you have no choice but to discipline or even terminate him. Now that you are finally ready to deal with the poor performance, you realize you don’t have any documentation to support your actions. Your ability to take a productive action is hamstrung and you’re left with the possibility of wrongful discharge lawsuits or handing over a lucrative severance package.

Thankfully, few of us will ever be faced with the aftermath of a halo effect with such enormous implications as those associated with Michael Brown. But every one of us will be expected to provide feedback in one form or another to employees. The halo effect can have devastating outcomes affecting productivity, morale, and risk management. It is a manager’s responsibility to give out the pats on the back while dishing out the counsel and discipline when necessary.