Performance Equations


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An introduction to Performance Equations

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  • IES and Gallup
  • Verax International Ltd - Organisational Transitions (OTI) 011105 If we think of a change as a journey – it has a Destination (that you need to know), A Start Point (that you need to know) and a Route (to be planned) JOURNEY START POINT At a glance view of Desired (Gold - Strategic Plan, Board – explain later) vs Actual (Blue) - this is the Start Point 4 Main Performance Bearing Mechanism factors at top 4 Main Results / Outcomes at bottom. Very Graphic. for any group / sub-group or Organisation + Benchmark * - Pause %ile scale - 50 th thick black line Operating Style Actual vs Desired Also Overall Effectiveness Score Gaps = Road Blocks, Hold-ups, etc.
  • Verax International Ltd - Organisational Transitions (OTI) 011105 PBM’s down left hand side in the 4 main clusters. Outcomes – Across top + - show how each PBM impacts on each outcome. e.g. Strategy Focus PBM’s little impact on Results/Outcomes. Management / Leadership – Carry all the burden for results. Structure – Negative Impact (N.B. This picture different for each Organisation) For each can go back into the Report & find out exactly why it has Impact. Now look at Why Organisation Structure has negative impact. CEO said, “ We have a bunch of people who want the business to succeed. Our systems & structure do everything possible to prevent them succeeding.”
  • Performance Equations

    1. 1. Taking the Guesswork Out of Building Organisational Performance
    2. 2. Company History <ul><li>Established in 1997 </li></ul><ul><li>Niche organisational development and change consultancy </li></ul><ul><li>Specialising in building: </li></ul><ul><ul><li>High performance culture </li></ul></ul><ul><ul><li>High performance leadership </li></ul></ul><ul><ul><li>High performance teams </li></ul></ul><ul><ul><li>Service excellence & customer experience management </li></ul></ul><ul><li>At the core of all our work is on-going research, diagnostics, delivering measurable results. </li></ul><ul><li>We describe the causal links between Performance Drivers, Organisational Effectiveness and Performance Results </li></ul><ul><li>Design & implement solutions </li></ul><ul><li>Measure the results </li></ul>
    3. 3. Clients We Have Worked With O 2
    4. 4. Our Philosophy About Organisational Performance <ul><li>Pinpoint diagnosis, robust prioritisation and decision-making </li></ul><ul><li>An integrated systemic approach to providing solutions for the organisation as a whole </li></ul><ul><li>Solutions that are contemporary , robust , sustainable </li></ul><ul><li>Solutions that create energy, drive and engagement </li></ul><ul><li>Support infrastructure that transfers learning into application </li></ul><ul><li>As much or as little external support as required </li></ul><ul><li>Measure the value </li></ul>
    5. 5. <ul><li>High Performance Culture </li></ul>
    6. 6. The Need for Better Organisational Performance <ul><li>Consider </li></ul><ul><li>90% of organisations believed that a clear, action oriented understanding of their business strategies could significantly influence their performance and business success. </li></ul><ul><li>However </li></ul><ul><li>Less than 60% of senior leaders and less than 10% of employees believe a clear understanding of their company’s strategy actually exists in their organisation </li></ul><ul><li>Less than 30% of senior leaders believe their organisations’ strategy are effectively implemented </li></ul><ul><li>In over 60% of organisations analysed through our consultancy work there is no perceptible link between strategy and day to day operations. </li></ul>
    7. 7. The Challenge of Translating Strategy into Action <ul><li>90% of organisations are unable to fully implement the strategy they’ve spent so much time, effort, and money planning </li></ul><ul><li>95% of employees do not understand their company’s strategy </li></ul><ul><li>85% of executives spend less than an hour per month talking about strategy </li></ul><ul><li>73% of employees believe their bosses don’t communicate the company vision and strategy clearly </li></ul><ul><li>Companies on average deliver only 63% of the financial performance their strategies promise </li></ul><ul><li>Only 46% of executives & senior managers believe leadership gains commitment effectively in their organisations </li></ul>
    8. 8. A Word About Employee Engagement <ul><li>12% employees actively engaged </li></ul><ul><ul><ul><li>70% neither engaged or disengaged </li></ul></ul></ul><ul><ul><ul><ul><ul><li>18% actively disengaged </li></ul></ul></ul></ul></ul>Cost to business €260 billion
    9. 9. Characteristics of an Engaged Workforce <ul><li>Pride in the company </li></ul><ul><li>Belief in the organisations objectives </li></ul><ul><li>Trust in colleagues, direct boss and senior leadership </li></ul><ul><li>Desire to work to make things better </li></ul><ul><li>Understanding of business context and the ‘bigger picture’ </li></ul><ul><li>Respectful of, and helpful to, colleagues </li></ul><ul><li>Willingness to ‘go the extra mile’ </li></ul><ul><li>Keeping up to date with developments across the business </li></ul><ul><li>Feeling valued </li></ul><ul><li>Belief in their ability to do their best every day </li></ul>But employee engagement is not the same as employee satisfaction
    10. 10. © Verax International Ltd. All Rights Reserved.030908 Diagnosing the Performance Culture <ul><li>Strategic Focus </li></ul><ul><li>Performance Management </li></ul><ul><li>Leadership </li></ul><ul><li>Structure </li></ul>Performance Bearing Mechanisms <ul><li>Business Performance </li></ul><ul><li>Satisfaction </li></ul><ul><li>Change </li></ul><ul><li>People Outputs </li></ul>Results / Outcomes 48 95 Overall Effectiveness 1st %ile 10th %ile 25th %ile 50th %ile 75th %ile 90th %ile 99th %ile
    11. 11. Relationship Matrix Business Performance People Outputs. RESULTS/OUTCOMES Satisfaction Change Understanding the drivers of performance outcomes is critical in knowing which levels to pull. PRICING/VALUE FOR MONEY PRODUCT/SERVICE PERFORMANCE BRAND IMAGE/TRUST EASE OF DOING BUSINESS RESPONSIVENESS TO CUSTOMERS TOTAL SUPPORT PACKAGE EMPATHY/COMPATIBILITY + + + + + + - - - - STRATEGIC FOCUS PERFORMANCE MANAGEMENT LEADERSHIP STRUCTURE Client specific strategic outcomes can be added COMPETITIVE STRATEGIES
    12. 12. <ul><li>High Performance Leadership </li></ul><ul><li>and </li></ul><ul><li>Developing Talent </li></ul>
    13. 13. Leadership Bench Strength <ul><li>Business challenges are becoming more complex and more difficult to solve </li></ul><ul><li>60% of leaders say they face challenges that go beyond their individual capabilities </li></ul><ul><li>84 % of executives and senior managers believe the definition of effective leadership has changed in the last 5 years </li></ul><ul><li>Only 7% of executives believe their companies have enough talented managers to pursue the most promising growth opportunities </li></ul><ul><li>Only 36% of companies rate their overall leadership capacity to execute strategy as “good” or “excellent” </li></ul><ul><li>40% of externally hired senior managers fail within 18 months </li></ul>
    14. 14. The Way Ahead <ul><li>Leadership today needs to be about creating adaptive performance cultures that provide the conditions for innovation to flourish in today's much more challenging and highly complex business environments </li></ul><ul><li>In order to do that leadership capability and talent needs to be developed as a journey at critical career transition points </li></ul><ul><li>The leadership capability requirements at each point need to address the contextual setting of the business challenges faced and the requirements of the role </li></ul>
    15. 15. Developing talent through the leadership pipeline Leadership Pipeline: A long-term, systemic approach to developing a sustainable supply of leaders ready to execute your strategy now and in the future — Charan, Drotter, Noel, The Leadership Pipeline, 2001 Passage Six Group Manager Passage Four Business Manager Functional Manager Passage Two Manager Manager Manage Others Manage Self Passage Five Passage One Passage Three Passage Six Enterprise Manager Passage Four Passage Two Passage Five Passage One Passage Three
    16. 16. Question ? <ul><li>Is your talent management strategy meant to satisfy a tactical performance requirement? </li></ul><ul><li>Or does it have to satisfy a strategic organisational requirement? </li></ul>It could be both
    17. 17. Different Approaches <ul><li>Everyone is talented in some area, to some degree (Inclusive) </li></ul><ul><li>Only some people have the innate qualities to lead the company into a future that can’t quite be described (Exclusive) </li></ul>
    18. 18. Categories of Talent <ul><li>Well Placed </li></ul><ul><ul><li>Well suited for their current role or a lateral position </li></ul></ul><ul><ul><li>Unlikely to move to the next level or expanded responsibilities within the next 2 years—particularly considering the expected growth of the business </li></ul></ul><ul><ul><li>May require development in order to scale and grow in their current role </li></ul></ul><ul><li>Expandable </li></ul><ul><ul><li>Seen as being capable of contributing to the organisation in a role with greater complexity, impact, scope and scale than their current role </li></ul></ul><ul><ul><li>Demonstrated that they can scale and grow with the organisation’s business </li></ul></ul><ul><li>Talent Pool </li></ul><ul><ul><li>An employee who has demonstrated top performance in increasingly challenging roles and have the differentiating attributes to rise to and succeed in more senior and/or more complex positions through expansion of current responsibilities, lateral movement to different area of responsibility or promotion to the next level </li></ul></ul><ul><ul><li>Talent demonstrates what it will take to lead and grow the organisation beyond the current strategy </li></ul></ul>
    19. 19. Performance Does Not (Always) Predict Potential 93% 7% 71% 29% Current performance is a necessary condition for potential but does not guarantee success at the next level BUT Only 7% of high potentials are not high performers Most high performers are not high potential
    20. 20. What Determines Talent High Performance High Potential Talent Pool Talent Differentiators + = Applied experience Capability Knowledge & skills Capacity +
    21. 21. Connecting Business Capability to Business Strategy Organisational Vision Business drivers Strategic priorities Cultural priorities Business Strategy Organisational values and behaviour Team capabilities Individual capabilities
    22. 22. How to build organisational performance
    23. 23. How to build organisational performance <ul><li>Recognise that organisational performance development is a journey not an event </li></ul>
    24. 24. How to Build Organisational Performance <ul><li>Diagnose and measure accurately performance gaps and drivers </li></ul>
    25. 25. <ul><li>Build a learning system that addresses the development needs of each level </li></ul><ul><li>Bridge the gap between learning and real work with action learning </li></ul><ul><li>Design and implement a support infrastructure </li></ul>How to Build Organisational Performance
    26. 26. How to Build Organisational Performance <ul><li>Involve leaders at all levels as champions, teachers, mentors, and in linking learning and feedback to goals </li></ul><ul><li>Engage heads, hearts and hands by providing a flexible mix of learning methods and approaches </li></ul>
    27. 27. <ul><li>To discover more </li></ul><ul><li>contact us at </li></ul><ul><li>[email_address] </li></ul><ul><li>01252 545 171 </li></ul>