Category Archives: Developing People

Performance Management Contrasts

We’ve had some fascinating conversations about performance management over the years, and have found quite a range of formal and not-so-formal approaches, along with variations in defining the process.

But while different organizations may employ different methods, there are a few areas on which most everyone we’ve spoken with enthusiastically agrees:

  • Positive versus punitive performance management works best.
  • Recognition is an important element of managing the performance of individuals.
  • Management must manage the performance of both individuals and processes.
  • Regularly scheduled performance reviews or evaluations of individuals are key and should be conducted more frequently than once each year.
  • Performance evaluations need not be coupled with merit-based or time-based pay raises and, in most cases, are more effective if not coupled with pay raises.

How does your organization define and execute performance management?

 

Rewards & Recognition Part 3: Comparisons

As discussed in our previous two posts, “Rewards & Recognition” programs can vary in a many ways.

For example some are very inexpensive to run, and others are costly; some are geared toward recognizing individuals, while others focus on rewarding teams.

Similarly, the reasons for implementing a program can differ a great deal, depending upon an organization’s situation and objectives; and as our Partners in Improvement groups discussed, the outcomes — both intended and otherwise — can also vary.

During our Partners’ discussions three distinct types of programs were compared:

  1. “After-the-Fact” rewards vs. “Defined Benefit” awards:
    Some organizations conduct recognition and reward programs that are designed to ‘catch people’ doing the right things, such as a “caught in the act” program that recognizes individuals by posting a card describing their accomplishments on a wall in the lunch room, or a “Bravo” program for peer-to-peer recognition, where recipients are awarded small gifts — in the $5-10 range.  These systems are designed to encourage certain behaviors and accomplishments — but an individual may or may not
    be one of the lucky ones ‘caught.’ Not every worthy act is rewarded, but the belief is that the program reinforces the
    desired behavior overall.

    Alternatively, some awards are planned in advance, such as an organization that gives one day off to everyone after every 250,000 hours without a lost time accident, or another program that promised a raise to all employees if first pass yield metrics were achieved.  Along the same lines, one organization implemented a partially-defined reward: the reward was defined, the criteria were defined, but there would be only one winner and the identity of that winner would remain uncertain until the end. This prize, in this case, was a one year lease on a BMW for the manager with the best results. The success of this program depended on being well-hyped in advance so that every manager improves his or her results in order to try to win. However, the size of the prize being so significant caused some dissatisfaction among some of the managers who didn’t win.

    Conclusions: both the individual and team concepts are effective. If a “one winner” approach is taken it is best to keep the value of the single award on the lower-end as opposed to awarding one “big” prize such as the above-referenced car lease.

  2. Team Awards vs. Individual Rewards:
    The primary advantage of individual recognition is the precision of being able to reward and recognize a person who best exemplifies the behavior that the organization wants to encourage.  Consider that, on any team, there are bound to be stronger and weaker contributors. The weaker contributors on a strong team are, perhaps, unfairly recognized for contributions they may not have made. Furthermore, the stronger contributors to a weak team are unfairly under-recognized and may become less motivated.  Individual rewards and recognition enable organizations to reward the people they believe most deserve it.

    However, often the success of an operational or project team as a whole is far more important to an organization’s success than the actions of individuals. Recognizing operational teams as well as temporary teams for their contributions encourages effective teamwork, helping one another to get further faster. It takes a mix of talents and personalities to build an effective team and while a team may have one or two stars, the success may also be due to the down-to-earth individual who keeps the group focused or the individual with the easy personality that defuses tensions and egos in order to keep the group working effectively.  Our research into employee engagement suggests that being viewed as an important member of a team is also very motivating. Indeed, in Daniel Pink’s book Drive, The Surprising Truth About What Motivates Us, he describes the pleasure people receive from being part of something bigger: a team, a movement, a purpose.

    Conclusions: While the benefits associated with individual rewards were recognized, the vast majority of our Partners expressed strong support for the benefits of team rewards and recognition.

  3. Intrinsic vs. Extrinsic Rewards:
    Intrinsic rewards are those that strive to produce a sense of appreciation, belonging, satisfaction or contributing to a higher purpose. Some rewards are free, such as a thank you note, a parking space, or putting a person or team’s picture in the newsletter. Some intrinsic rewards may cost the giver something,
    such as buying a team lunch, giving everyone a day off, and making a contribution to a charity of the person or team’s choice, but these rewards are non-monetary and are not designed to appeal to a person’s acquisitiveness. Rather they emphasize the organization’s appreciation for a person or team’s contribution.

    By contrast, monetary rewards have a simple and clear cash value for the recipient. For example, a grocery chain gives $50 to any individual accumulating six ‘stars’ which are awarded by coworkers or customers to recognize exceptional service. The main advantage of monetary rewards is that, whether the amount is large or small, public or private, before or after
    the fact, one can expect that all recipients will value the reward because the recipient can spend it however they choose.

    Conclusions: While appreciating the clear nature of extrinsic rewards, nearly all of our Partners had a cautionary tale about unintended consequences; and the bigger the reward, the bigger the problems. Unlike rewards aimed at intrinsic motivation, the problem with extrinsic rewards was not that they might fail to influence the recipients, but rather that the outcomes were often entirely different than intended. For example, the organizations that implemented large monetary rewards, such as the BMW lease, found they attracted attention and inspired avarice as intended. Many people really wanted to win them. In fact, a good many people felt they deserved to win them. The unintended results included resentment, accusations of unfairness, and powerful disincentives for people to help one another to raise the overall performance of the organization. Team morale took a serious hit as well.  As one of the Partners put it, “An extrinsic reward seems to create 1 winner and 99 losers.”

Ultimately, our Partners agreed upon a list of best practices, which we will share in our next post.

ISO Quality Management Principles – Balancing Process & People

As you may know, in 2015 the International Organization for Standardization (ISO) issued an update to its widely followed 9001 standards. 

This update was not, at the time, officially part of the 9001 standards, but it included the addition of new Quality Management Principles outlining, according to an Engagement Strategies Media (ESM) article, the fundamental conditions necessary for an organization to sustain high levels of quality and performance.

The Quality Management Principles are:
  1. Customer focus
  2. Leadership
  3. Engagement of people
  4. Process approach
  5. Improvement
  6. Evidence-based decision-making
  7. Relationship management

As noted in the article, these principles focus on both “process” and “people/engagement.” As the article goes on to suggest, this balanced focus is clearly necessary to achieve and sustain high levels of quality and performance.

Read the full article…

Managing the Cost of Disengaged Workers

An earlier post summarized the real costs associated with disengaged workers, which is close to $500 billion per year based on research by glassdoor.com, the Enterprise Engagement Alliance (EEA), and others.

Wow!

Fortunately, there are proactive steps that can be taken to avoid these costs and the collateral damage to team morale and brand that is a regular side-effect.

Based on research and data shared by the EEA and The Chartered Institute of Personnel and Development, the following five steps can drive employee engagement, and reduce the number of disengaged workers and the associated costs:

  1. Enhanced recruiting and on-boarding — The first steps involve the inclusion of the organization’s mission and vision into interviewing conversations, and a more conscious effort to identify and hire people with aligned goals. Adding a mentor program to the on-boarding process helps new hires assimilate
    faster so they became more productive in less time as well.
    Enabling people to achieve higher levels of productivity and success early-on promotes greater engagement levels, and reduces first-year attrition rates. Early churn tends to demoralize
    everyone, so in addition to reducing re-hiring and re-training costs, the costs associated with negativity within the existing workforce are also reduced.
  2. Consistent performance management and communication — People need to have meaning in their work, and understand how their work aligns with organizational objectives. This communication works best when systematized as part of structured, proactive approach to performance management.
  3. Learning and development — A young, fast-rising junior executive had been working at a large bank for just over six years. When he was asked about his job and how he felt about it he said, “The job’s OK.” His lack of enthusiasm was evident, and when pressed to say more he added, “Well, I’m not really learning much anymore.” He went on to confirm that he was not truly engaged, and that he did not make much of an extra or discretionary effort, which engaged workers regularly make. Forward thinking
    business leaders understand that the path to sustainable employee engagement is to drive productivity, and to do so through ongoing education and empowerment.
  4. Recognition and rewards — Recognizing and rewarding employees is not a new concept, but if the goal is to engage people rather than simply acknowledge milestones (such as length of service), then the approach must be aligned with what is meaningful to each recipient.
  5. Flexibility and work/life balance — Employer/employee relationships, expectations, and engagement criteria have evolved significantly over the past decade. Data from a PwC survey of 44,000 workers who had become less engaged indicated that “71% said their jobs interfered with their personal lives, and 70% said they wanted to be able to work from home.”
    Employees can also become disengaged when they feel their managers only care about the bottom line. More than one-third of U.S. employees (39%) don’t believe their bosses encourage them to take allotted vacation days, and almost half (45%) say their bosses don’t help them disconnect from work
    while on vacation, according to a Randstad survey.

Read the full article… 

Is Your Team Capable of Achieving Breakthrough Results?

While identifying the right things to work on  and using the right tools are critical decisions we must make each day, we must also have the right people with the knowledge and skills working on the right things if we are to truly achieve breakthrough solutions.

Taking an objective overview of employees’ capabilities, strengths and needs on a periodic basis can help us recognize both the strengths to build on and improvement areas for training and coaching.

As part of the employee capability assessment process, it’s best to use a strategic mixture of one-on-one and small group interviews to cover a diagonal cross-section of the organization.

Generally speaking, the objective is to talk with people about the organization, how they are treated and valued, and assess their level of engagement. Meeting with key people who manage and work in various areas is also crucial, as is seeking to understand how the organization’s strengths can form the basis for the creation of a systemic continuous improvement process.

Improve Sales Too

It’s rare to find a business organization of any substance
that has not implemented at least some type of improvement initiative in their manufacturing, administrative, or service sectors,  whether it be the Conway approach, LEAN, Six Sigma, and so on.

But, as noted in a previous post, not as many have defined a sales process, nor have they taken the hunt for waste and the quest for continuous improvement into the realm of sales .

Selling is a process. The basic principles of work and process improvement certainly apply, and, just as these principles have brought about measurable gains in other sectors, so too, if properly executed, can they help those in the selling arena learn how to contribute more to the overall enterprise; how to work smarter, faster, and with more success.

These principles might also help a sales team stand out from the competition due to more effective execution.

By teaching the basic principles of studying, changing, and improving work and work processes to sales professionals, an organization can empower them to help themselves and the enterprise realize major (breakthrough!) accomplishments, such as:

  • Communicating at a higher level with customers
  • Gathering the “voice of the customer”
  • Interacting more harmoniously with internal customers
  • Selling more in less time
  • Managing key accounts more effectively
  • Increasing margins

As sellers learn more about the effects of continuous improvement, they will become better at translating the company’s true value-added message. They might even help to develop it!

As they become more educated and enthusiastic about the relevance of simple statistics, variation, and waste reduction, it’s likely that they will also become more effective at uncovering and expressing true customer needs.

And finally, a sales force so educated will more readily recognize the advantages of incorporating all of these principles into their daily sales effort. As a result, they will become more efficient. They will become more successful. Successful sales people stay on, sell more, and help the company grow more profitably.

Why not improve sales too?

10 Good Reasons for Defining (& Improving) the Sales Process

Have you formally defined your organization’s sales process?

In other words, have you documented the specific steps you or your sales team must execute to move from identifying a lead to closing the sale?

If so, are they the right steps?  Have you mapped the key objectives and activities for each step? How about measuring team performance on a step-by-step basis? Are people working on the right things? Have you identified the best opportunities for continually improving each step and, as a result, the entire process?

We’ve found that those who place a strong focus on these things are able to execute the sales process much more effectively and, as a result, enjoy a number of advantages, which include:

  1. Consistent approach which can more easily be analyzed and continually improved, most often resulting in a greater competitive advantage
  2. Common language throughout the organization, facilitating more effective strategizing
  3. More consistent and diligent lead qualification, thus promoting efficiency and reducing waste
  4. More precise definition of transaction status and progress, thus more accurate forecasting
  5. More comprehensive need assessment, which promotes a consultative selling style and higher margins; better assessment also tends to bring-about a heightened responsiveness to customer needs, interests and priorities, and often yields larger average order size
  6. Heightened ability to incorporate the voice-of-the-customer into organizational decision-making
  7. Higher levels of conscious competence and team development
  8. Shorter sales cycles
  9. More natural closing
  10. A better customer experience, as the “diligent” execution promotes differentiation

How to Nurture the Ability to Identify Waste

Continuing the theme of our previous post — which stressed the importance of focusing on “identifying and eliminating waste” rather than simply focusing on “improvement” — it is important to encourage people at all levels to look for the waste that is hidden within their work processes.

But people tend to be risk averse, and it is often uncomfortable and difficult for most to acknowledge waste.

Yet identify it and acknowledge it they must, before they can envision a solution for it. Therefore, senior management needs to nurture the practice if it is to take hold within the organization. Until an organization recognizes the waste for what it is, there will be no full court press to eliminate the underlying problems, and no breakthrough improvements.

How do you nurture the ability to recognize the waste embedded in your business processes?

Constant questioning. Ask yourself and everyone else if you would need this if everything were right, and right the first time.

It sometimes helps to bring in outsiders to help you look for waste, because it is easiest to think “outside the box” if you come from “outside the box.” Customers and suppliers or people from adjacent processes may challenge assumptions we don’t even realize we are making.

Benchmarking internally, within the industry, and in different industries can also raise questions and help you recognize waste that you have overlooked before.

5 Ways to Reduce the Cost of Disengagement

Our previous post shared data on the various and real costs associated with disengaged workers.

Here are five proactive steps that can be taken to avoid these costs and the collateral damage to team morale and brand that is a regular side-effect.

  1. Enhanced recruiting and on-boarding — A good first step toward increasing employee engagement and retention can be taken at the recruiting stage. This might involve the inclusion of the organization’s mission and vision into interviewing conversations, and a more conscious effort to identify and hire people with aligned goals. Adding a mentor program to the on-boarding process can help new hires assimilate faster so they become more productive in less time as well.
  2. Consistent performance management and communication — As expressed in a Forbes article by Victor Lipman, “People leave managers, not companies.” People need to have meaning in their work, and understand how their work aligns with organizational objectives. If managers communicate a shared purpose or sense of direction, and encourage employees to openly share their perspectives and input, then they can increase employee engagement. This communication works best when systematized as part of structured, proactive approach to performance management. This methodology includes frequent feedback rather than annual performance appraisals and reviews, ongoing engagement surveys with real-time feedback loops, and protocols for keeping people aware of how individual work impacts organizational goals and how it aligns with mission and vision.
  3. Learning and development — Forward thinking business leaders understand that the path to sustainable employee engagement is to drive productivity, and to do so through ongoing education and empowerment. In support of this perspective, a recent article in Human Resource Executive magazine identified “continuous learning opportunities and personal development” as being two of the four key criteria (scheduling flexibility and social responsibility being the other two) recent graduates value most as they evaluate career options. But expanding workloads and limited resources can make it difficult to provide initial and refresher training for senior leaders, associates, and new hires. Learning management systems (LMS) enable many organizations to maintain training and development programs in a manageable way.
  4. Recognition and rewards — Recognizing and rewarding employees is not a new concept, but if the goal is to engage people rather than simply acknowledge milestones (such as length of service), then the approach must be aligned with what is meaningful to each recipient. The Enterprise Engagement Alliance suggests stepping-back from the traditional monetary rewards.
  5. Flexibility and work/life balance — Employer/employee relationships, expectations, and engagement criteria have evolved significantly over the past decade. Data from a PwC survey of 44,000 workers who had become less-engaged indicated that “71% said their jobs interfered with their personal lives, and 70% said they wanted to be able to work from home.” Employees can also become disengaged when they feel their managers “only care” about the bottom line. More than one-third of U.S. employees (39%) don’t believe their bosses encourage them to take allotted vacation days, and almost half (45%) say their bosses don’t help them disconnect from work while on vacation, according to a Randstad survey. Employers who proactively maintain positive relationships with employees and encourage them to utilize allotted vacation time are more likely to boost company morale, reduce turnover and increase productivity.

Read the full article…

Emotional Intelligence – A Driver of Capability?

eqandci2Spring-boarding from our previous post, which focused on team capability and its impact on Continuous Improvement, today’s question references the role of Emotional Intelligence (E.Q.), and its impact on employee capability.

Emotional intelligence is the phrase used to describe the ability to identify, use, understand, and manage emotions in positive ways.

Examples include:

  • To relieve stress
  • Communicate effectively
  • Empathize with others
  • Overcome challenges
  • Defuse conflict

There are several competencies associated with E.Q., which are often grouped into four major components:

  1. Self-awareness — You recognize your own emotions and how they affect your thoughts and behavior; know your strengths & weaknesses; have self-confidence.
  2. Self-management — You’re able to control impulsive feelings and behaviors; manage your emotions in healthy ways; take initiative; follow through on commitments, and adapt to changing circumstances.
  3. Social awareness — You can understand the emotions, needs, and concerns of other people, pick up on emotional cues, feel comfortable socially, and recognize the power dynamics in a group or organization.
  4. Relationship management — You know how to develop and maintain good relationships, communicate clearly, inspire and influence others, work well in a team, and manage conflict.

Research shows that organizations led by people with high emotional intelligence tend to have climates in which information sharing, trust, healthy risk-taking, and learning flourish. These teams tend to exhibit a greater level of overall capability as well.

Low levels of emotional intelligence create climates rife with fear and anxiety. Fearful employees may produce a lot in the short term, but over the long run, quality and productivity suffer.

Leaders must be attuned to their own moods and their effect on the emotions of others because emotions are predispositions to actions.

Now that we’ve established the ways in which E.Q. can enhance productivity, our next few posts will focus on how to recognize organizational E.Q., and how to drive it to higher levels.