In little over a decade, the observation of teaching and learning (OTL) has become the cornerstone of Further Education (FE) colleges' quality systems for assuring and improving the professional skills and knowledge base of tutors. Yet OTL remains an under-researched area of inquiry with little known about the impact of its use on the professional identity, learning and development of FE tutors. This paper examines the specific practice of graded OTL and in so doing discusses findings from a mixed-methods study conducted in 10 colleges situated across the West Midlands region of England. Data from a questionnaire survey and semi-structured interviews were analysed within a theoretical framework that drew largely on aspects of Foucauldian theory as well as the twin phenomena of new managerialism and performativity. This analysis revealed how OTL has become normalised as a performative tool of managerialist systems designed to assure and improve standards, performance and accountability in teaching and learning. It is argued that FE has now outgrown graded OTL and it is time for a moratorium on its use. Colleges and tutors need to be given greater professional autonomy with regard to OTL and be allowed to develop their own systems that place professional learning and development at the forefront, rather than the requirements of performance management systems.