Competing in ever globalising markets, organisations need to improve both the quality of their products and services and their productivity in producing and supplying them. This applies to both the private and public sectors. Performance Management Systems need to be implemented or reviewed to help drive the required improvements in quality and productivity.
Many managers and supervisors shirk their duty to manage the performance of their subordinates to the detriment of both employee and organisation performance. They do so out of a feeling of discomfort about assessing another human being’s performance and that often comes from a lack of skill. They deprive their subordinates of the opportunity to understand what is expected of them and to develop the behaviour skills and knowledge required to achieve what is expected.
In its simplest form, performance management requires the supervisor to think and determine what the Key Result Areas (KRAs) are for a particular role, set standards of performance for similar roles and targets of performance for individuals. Once that hard work is done, measuring and discussing performance in most cases is simple. Performance management only gets hard when there are no standards or targets of agreed KRAs.
Care needs to be taken in framing KRAs. Many supervisors do not think clearly enough about this step. A supervisor needs to ask ?Given the objectives of the organisation, what are the few key results we need from this role which will drive us to our objectives?? The trick in developing a good KRA is to be specific and to articulate a result.
A KRA should contain no verbs as the KRA is not about an action. It should not contain words, which describe a direction or measurement. If words such as ?develop?, ?reduce?, ?improve? appear in a KRA, then the manager has not understood the purpose of a KRA and their approach to performance management is already compromised.
Consider a marketing role. Market share is an unlikely KRA as a team including marketing, sales and logistics roles is likely to be responsible for market share. A marketing role however, can have responsibility for brand awareness or advertising spend or reach and frequency of advertising. These are appropriate KRAs.
Identifying KRAs helps individuals clarify their roles and prioritise their activities aligning them with the organisation’s strategic plan. It is mandatory that all KRAs can be measured numerically. If it can’t be physically measured either invest in the ability to measure it or change the KRA to something which can be measured.
For similar roles in a large organisation e.g. a sales team, standards of performance for each KRA need to be agreed with the team. A sales KRA may be the ratio of successful sales visits over the total number of sales visits. The standard of performance for all sales people may be one in ten. This is the standard below which no sales person would be expected to perform.
Individuals in the team however, may have different competence based on skills and knowledge gained from further years of experience or a behavioural trait which makes it easy for customers to build a rapport with them. A new sales person would not be expected to have the same sales success as a sales person with five years experience. One might expect the experienced sales person to achieve a success rate of one in eight. This then becomes that sales person’s personal target.
Setting agreed KRAs and standards of performance for like roles and targets for individuals is a simple process which gives clarity to the roles of individuals and their personal performance requirement in a team.
Having set KRAs, standards and targets, it is relatively easy then to have a regular conversation about performance. Conversations about performance can and should take many forms including a formal process review and coaching sessions. However, studies show that the performance review itself is often the weakest link in performance management.
Supervisors tend to perform reviews which only emphasise results and this is insufficient to improve performance. Best practice performance management systems also include a review of competence, the behaviour skills and knowledge required to achieve a result. Supervisors need to be trained to perform reviews and have their ability tested.
Coaching sessions are a powerful addition to a performance management system. Coaches need not be the supervisor as not all people have good coaching skills. Having an experienced mentor coach developing people in how to do things is an age old practice that continues to reap rewards for positions from CEO to new recruit.
Implementing the simplest form of performance management described above will improve productivity. To be certain that they are extracting the maximum productivity they can, those organisations who have a performance management system should review the objectivity of their system and the skills of their supervisors in performing reviews and coaching their subordinates.
