We all want the ultimate high performing team. We want to be part of one and we’d love to lead one. We aspire to the perfect work life balance that includes flexibility, wellbeing and mindfulness, as well as opportunities to grow and work at the cutting edge. We want to introduce market-leading software, increase our automation and get on the artificial intelligence bandwagon. There are many shiny new strategies and buzzwords in corporate HR today…. But do they genuinely fit your business?
It’s great to aim for best practice, leading-edge programs, BUT you must have the fundamentals right first. As a consultant to small and medium sized enterprises (SMEs), the gaping holes in key HR practices I see all too frequently are:
Policies and Procedures
Training and Development
Rewards and Recognition
Performance Management, in particular, is an absolute must for business growth and success. Unfortunately, many businesses grow so rapidly that they skip the basics in the quest to simply keep up and to continue bringing in the dollars. Staff performance is often managed informally or with a broken tick and flick review system, and in other cases I’ve met some leaders that haven’t sat down with their staff to discuss their performance for YEARS! Let’s take a look at this fundamental HR practice and ensure you’re doing what you can to build the ultimate high performing team to support your business.
What is Performance Management?
Thought leaders are now referring to it as ‘performance motivation’ rather than management. I think Google describes it very well: “The fundamental goal of performance management is to promote and improve employee effectiveness. It is a continuous process where managers and employees work together to plan, monitor and review an employee's work objectives or goals and his or her overall contribution to the organisation." I agree with this definition - performance should be linked to effectiveness, should be considered an ongoing process and should be linked to goals and the organisation.
Performance Management looks different in every organisation. The latest fad in large corporate's like GE and Netflix is to remove formal performance reviews, but rather actively manage and measure performance in an informal but regular way. To do this effectively they need experienced leaders and programs to support them. At the other end of the scale, a small business may use a spreadsheet and diary notes. Somewhere in the middle, an organisation may have some form of technology to assist them. I’m not too fussed what systems, technology and amazing tools you use… 360 feedback, self-evaluations or peer feedback. What’s most important is that it gets done effectively, fits your business needs and adds value.
How do you manage employee Performance?
Best practice in large corporations will not typically work for your small business. What you need is a simple process to help you build a solid productive, highly engaged team that will help you grow your business. It looks like this:
Expectations – Do your staff know what they are responsible and accountable for? Have you set minimum expectations or KPI’s? And don’t think KPIs are only for the sales or tech team - ALL roles can be measured… via responsibilities, projects, portfolios etc. Make sure your staff know what their key tasks and responsibilities are and what they will be measured on.
A key element to consider here is does the team member have the tools and capability to meet these expectations? If not, can they be trained? Can you provide them with the tools? Are they even in the right job? Too often I see that staff have evolved into roles they are not actually qualified for, which sets everyone up for failure. I recently worked with a company in the construction industry that grew very quickly. What we discovered was that most people were in roles they weren’t qualified or trained for, which meant they were out of their depth. The risk of this became evident to the owner, who realised that if he had the right people in the right roles, he would have higher productivity and higher job satisfaction and better overall results. So I took him back to basics and jotted down key responsibilities for each role, which then turned into a skills matrix and training plan. It may sound complicated but it’s actually not! Feedback from the staff and owner provided evidence that when grey areas are removed, and everyone knows what they are responsible for, clarity and purpose is achieved. The owner was able to more effectively delegate tasks and projects and therefore have time to focus on his business strategy.
Do your staff know how they contribute to the ‘big picture?’ Are they aware of your overall strategy? If not, take them on the journey with you and watch the benefits.
Beyond day-to-day expectations, create larger goals and/or projects for the team to contribute to. In corporate HR I would always sit with the CEO on the key strategy points, discuss how we could incorporate that into the people strategy and have it flow through the entire organisation so everyone is working towards the same goals. Examples of these larger goals could be a financial strategy, an acquisition, a revenue target, or a profit target where when it is met, everyone receives the benefits. Be aware that these big goals don’t always have to be financial; it could be an environmental initiative, broadening your product offering, new product launch, or cross selling of your services. Whether it is a financial, growth, customer or operationally focused strategy, make sure you choose a goal/s for the entire team to focus on. When the staff feel part of something bigger the benefits are widespread.
What is the point in having expectations or goals if they are never discussed? Check in with your staff regularly – please!! This is where great leaders thrive and the average ones fail. Great leaders give real time feedback and are constantly open and honest about how the individual and the team are tracking. Check ins can be daily, weekly, monthly, quarterly – there is no hard and fast rule here depending on your business, but it MUST be done.
I recently did some work with a SME whose leader knowingly lacks emotional intelligence. I assisted this business owner by having performance discussions with some staff around his areas of concern. I was really happy he recognised his weakness in this area and chose to outsource this process in a productive manner. However, when I next visited, that leader had done no check ins and offered no feedback on how the staff were tracking in the areas of concern! The staff were lost, disengaged and probably job hunting.
Make sure that your performance management process includes accountability for your people leaders to check in on their staff. They must discuss expectations and goals, provide feedback and develop their team.
When expectations are met, when projects are completed on time and on budget, recognise it! Reward good performance and share the news amongst the entire business. Remember, reward does not always have to equal money!
There are many variables we can add to this simple system like wellbeing, money, professional development and flexibility but get 1,2 and 3 working well and the additional recognition variables then flow naturally. Research clearly shows that $ is not the key driver of rewards.
As business leaders I want to remind you all of the value of the old fashion 1:1 with your staff. It is priceless, literally! We are all sooo busy working on and in our businesses that we sometimes forget who is right in front of us. A great example of the value of this was demonstrated by one of my clients. The CEO of a large international transport company puts a time in his calendar once per week to have a coffee with a staff member. He gains enormous value in getting back to grassroots and receiving direct feedback on the business and any issues, and the coffee chats provide huge motivation and reward to the staff members.
Great Leaders manage performance……
We’ve all had good and bad managers. I still remember the one who took all my ideas for his own and openly took credit for them. It taught me a valuable lesson about what not to do in my early career!
A recent study by CareerBuilder.com (US Seek equivalent) shows that a whopping 58 percent of managers said they didn’t receive any management training. In SME’s this is particularly common. Most managers are promoted because they were good at what they do rather than because they were good at making the people around them better. This is the reality in SME’s where many leaders aren’t trained on how to lead. To create a high performing, future proof business, I’d love to see more SME’s placing the right capabilities into the right roles. A good performance management structure facilitates this.
Managing staff is tough and without the right people skills and emotional intelligence it’s even tougher. Great leaders of teams will follow my 4 principles regularly. To quote Jack Welch “Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.” Leaders engage with the team, bring them on-board with the team/organisational goals, check in constantly so all the team know where they are at and they recognise and reward those deservingly.
In summary, whilst I love helping SME’s build great programs around cutting edge HR practices, the basics need to be in order before aspiring to great people programs. Regardless of where you are on the Performance Management spectrum I’d love to see you all reflect on the 4 steps and consider whether you’re successfully implementing them. Make sure your staff are in the right roles, have clear expectations, are involved in organisational goals, and are receiving recognition for efforts along the way.