Shining a spotlight on what performance management means for an organisation, and what can happen when you don’t do it.
performance
/pəˈfɔːm(ə)ns/
noun
• ‘the action or process of performing a task or function’.
• ‘a task or operation seen in terms of how successfully it is performed’.
perform
/pəˈfɔːm/
verb
• ‘to carry out, accomplish, or fulfil (an action, task, or function)’.
[Definitions taken from the Oxford English Dictionary]
As an accidental performance specialist, in years gone by, I’ll freely admit that I frequently found myself googling ‘what is performance?’.
Performance is a fairly general, innocuous word. The word has many connotations depending on your area of work or your interests. It was not an uncommon experience for me, when meeting someone new for the time and explaining I work ‘in performance’ that the conversation veered into the performing arts, or far worse, something much more technical and engineering-related before I had to hastily backtrack and explain that I meant how an organisation performs. And then I watched, as the interest waned and the conversation faltered.
So after years of working ‘in performance’ I’ve amassed a wealth of tools and definitions to help me explain what I mean by performance and what it encompasses as a professional discipline. I’d like to share with you what I mean by performance in the context of how effectively an organisation and crucially, its leadership operates.
Performance management is inherently a good thing
Firstly, let us start with a presupposition. When I refer to performance, in the context of an organisation or leadership team, the word implies good performance or simply ‘doing better’. Because no wants bad performance, do they? Performance is therefore inherently positive and something to strive for. Performance management as a discipline then, simply refers to the tools at ones disposal, the things that can be done to improve performance or maintain desired levels of performance in any or all the core activities that an organisation is engaged in.
Performance management is impartial and objective
The management of performance as a professional discipline is entirely impartial, objective and agnostic of any other professional discipline. In other words, performance management can be applied to any profession, area of an organisation, or business activity, be that, financial, people, technology, product, service or even how effective internal operations work in support of an organisation achieving its objectives. Importantly for me, performance management also means professional and personal conduct and these are encapsulated by the values and culture of an organisation.
Components of performance
I have come to define high performance as having three components being:
Inefficiencies are minimised, risk is mitigated and positive impact is created. Performance management may focus on any one, all, or a combination of these components, they are not mutually exclusive. It is possible, for example, that by placing a direct focus on mitigating risk, an indirect benefit of reducing inefficiency is created. Let’s take a look at each of these components in turn.
Components of performance
| Inefficiencies are minimised | Hidden expenditures are identified and reduced | Cost-benefit frameworks used to understand the true costs of activities | Refining key business processes to save time and resources |
|---|---|---|---|
| Risk is mitigated | Clear strategy for managing risk where business risks are routinely identified, reviewed, mitigated or tolerated | Improved awareness and competencies of staff with clear accountabilities and governance | Compliance, quality control and risk management reporting is in real time and actionable |
| Positive impact is created | Better outcomes are achieved, for example a greater proportion of those using a particular product experience better results | The reach or scope of services delivered is increased so that more people benefit | The quality of service such as ease of access access or customer communication and satisfaction is improved |
The summary above defines what performance management is. Now I’m going to explain how performance management is done. And this simply involves three things:
People + Processes + Systems
| People | The values and culture of an organisation, levels of employee engagement and commitment, talent management, succession planning and professional development. |
|---|---|
| Processes | How people do what they do, how they undertake actions they are responsible for, how decisions are made, how outcomes are created. The policies, procedures and processes which have been defined (or not!) which govern business activities. |
| Systems | The tools and business systems that an organisation employs such as email, databases, paper based systems to record information, document repositories, case management systems, customer relationship management systems, financial accounting software, telephony etc. |
What goes wrong without performance management
For an organisation to perform well, leaders need to ensure they take care of their people, their processes and their systems, in a comprehensive way. All too often, I have seen organisations fail because they have no central vision or strategy for how they operate. It is not uncommon for the HR or people department to operate entirely separately from Technology, nor for oversight of critical business processes to sit separately across all of the different teams who may be engaged in a process, without any of the teams having visibility of what the others teams do, and no one person having visibility of the whole process. Such short-comings result in a lack of transparency and failures in accountability, which can, in the most severe cases, result in culpability of executive leaders.
So as a leader, what are you currently doing to ensure that your organisation is performing? Are you experiencing challenges in areas similar to those noted in this post? I can help you to clearly define the outcomes you are seeking and to unpack the issues you face to produce a robust plan for achieving your results.
Get in contact to find out more.