Solving Performance Problems

Quality is in the dumper and sales are slumping. How do you approach solving performance problems? What is your performance management strategy? Retrain the sales force? Fire the quality control inspectors? Reengineer operating processes? Introduce a new compensation scheme based on gross sales improvement?

Chances are, if you put ten experts in a room and posed this question, you would get ten different answers. And, chances are, they would all be wrong because human beings tend to look at solving performance problems from the framework of their own experience and expertise. The compensation expert sees pay issues, the reengineering consultant sees process issues, and so forth. In solving performance problems, hardly anybody looks at the whole picture. Solving performance problems requires a framework for determining the root causes. We need to look at solving performance problems from a systems perspective and not get bogged down at the employee level only.

Organizations are comprised of human beings who may be part of a work team which performs and manages processes to create outputs in the form of products or services. How these individuals are organized and lead defines what they are (work group, team, dysfunctional team). Their relationship within the work cell and beyond it defines how effectively they can work together to perform and manage the processes necessary to achieve acceptable results. So when we look solving performance problems with a condition, we have to look at potential issues on three levels – the organization, the process and the performer.

Three Levels of Inquiry

From a performance management perspective, the organizational level defines business strategy, that is, how people are organized to execute strategy, and how results will be measured. At the process level, we determine the methods or steps that go into creating and delivering a product or service. Organizations have many internal processes that have to work well if the organization is to function well. Processes are the link between individual performance and organization performance and may span organizational functions (e.g engineering, marketing, sales) or extend to outside the organization. Processes are, in turn, performed and managed by individuals at the performer level.

Using this Framework to Solve a Performance Problem

At the organizational level, you might ask:

• Have we accurately defined our target market?
• Is our sales and marketing strategy correct?
• Have we set prices correctly?
• Is the organization structured to effectively build, support, and deliver our products or services to our target market?
• How are we measuring results?

At the process level, you could ask:

• Do our sales processes still support the way we want to do business?
• Are these processes designed correctly?
• What non-sales processes influence sales?
• Are we managing by function and neglecting to manage cross-functional processes?
• How are we measuring sales process goals and results?

At the performer level, you could ask:

• What jobs are critical to managing and performing the processes critical to sales?
• Do we have the right people with the right knowledge, experience, and skills performing these processes?
• Is individual performance consistent?
• Does the relative performance of individual performers adequately reflect the results of the group as a whole?

Individual performance is a function of six interrelated factors. These are:

Performance Requirements: Have we clearly and effectively described what is expected and how it will be measured?

Removal of Obstacles: Have we removed the obstacles to effective performance including supplying adequate information, resources and time?

Consequences: Is the impact to the company, department or performer for non-performance clear and compelling?

Knowledge and Skill: Does the performer have the required knowledge and skill to produce what is required?

Feedback Does the performer know how results will be measured, whether the output is on target and how to fix it if it is not?

Individual Capacity: Does the performer have the capacity to produce the results expected?

Why Doesn’t Performance Always Improve?

When we look for single causes of performance management problems, we generally miss the point. To be consistent, individual performance is a function of all six factors noted above. If the performer knows what is expected and has the skills and capacity to perform, but is inhibited by organizational obstacles, he or she won’t be able to perform. In a large number of cases when performance is lacking, the cause is a breakdown in one or more of the six elements.

Put another way, if you put a good performer against a poorly designed system, the system will always win. To be accurate in performance management, whether we are monitoring the entire organization, a department, a team or an individual, we have to look at all of the factors that influence performance. If we do that, it is more likely that we will create an optimum fit between performer, the operations system, the performance management model, and the needs of the company.




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