Assume someone lined your company up against ten other competitors and told you that if you could beat them in a race you would receive compensation equal to doubling even triple your annual revenues. How fast could you go?
Now assume that same person told you that the distance was exactly 1000 miles and you could cover it however you wanted. How fast could you go and what method would you use?
Now assume that the goal was to travel as far as possible in the next 1095 days. You could only use specific vehicles and you were be given a specific amount of fuel and resources. How fast would you go and what would you do first?
Lastly assume that the goal was to travel as far as possible in the next 1095 days (you are still limited to the type of vehicle, fuel and resources). You are given a team. Your bonus would be double if you ensured that all of the team members completed the race within 5% of your time, but EVERYONE must beat the average time of last years race by at least 10%. Now how fast would you go and what would you do first?
Oh yeah – If at any point during or after the race if it is discovered that you cheated in any way, you must return all of the winnings, PLUS a minimum of 50% in penalties.
Company performance is a collection of individual performance which is a function of aptitude, and attitude; in other words ability, and effort (which is a function of motivation and engagement). Responsibilities, accountability, goals etc set an organizational framework for performance appraisal and measurement.
At any given point of time, the ability is invariable/constant, we can only increase the effort based on perceived rewards and risk. what do we know:
- The distance is 1000 miles however we don’t know the terrain or the start and end points
- The resources are limited so efficient planning is essential
- Its not just your individual performance that needs to be efficient but also the team
The concept of quality, effectiveness and performance is at the core of many ideas about management and leadership over the past decades. Dr. W. Edwards Deming once define the 14 points are for organizational performance excellence.
- Create constancy of purpose for the improvement of product and service.
- Adopt a philosophy of cooperation (win-win) in which everybody wins.
- Cease dependence on mass inspection to achieve quality. Improve the process and build quality into the product in the first place.
- End the practice of awarding business on the basis of price tag alone. Instead, minimize total cost in the long run.
- Constantly improve the system of production, service, planning or any business activity.
- Develop an organizational development plan to update skill sets.
- Adopt and establish strong leadership for the management of people, recognizing their different abilities, capabilities, and aspiration.
- Drive out fear and build trust so that everyone can work effectively.
- Break down barriers between departments and abolish competition by building a win-win system of cooperation within the organization.
- Eliminate empty slogans, mandates and targets asking for zero defects or new levels of productivity. Such demands only create adversarial relationships.
- Eliminate numerical goals, numerical quotas and management by objectives. Substitute leadership goals and outcomes for performance.
- Remove barriers that rob people of joy in their work. This will mean abolishing the rating or merit system that ranks people and creates competition and conflict.
- Institute a vigorous program of education and self-improvement.
- Put everybody in the company to work to accomplish the transformation and new vision.
Performance for performance’s sake is seldom the driver of excellence and success. It is the combination of goals, responsibility, accountability and rewards that make performance measurement an effective tool.
What are your thoughts?
Call a senior consultant with Ember Carriers at (513) 984-9333 for a 30-minute complimentary consultation to discover how to FUEL success in your business.
- Myths regarding performance management(business.financialpost.com)
- Five Ways Managers Can Improve Their Performance(under30ceo.com)
- Are Deming’s 14 Points Still Valid?(qualityandinnovation.com)