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Building a Performance Culture- A Guide for Leaders                         eBook                        Tim Kuppler
Preface for LeadersThis guide is about building a performance culture as the foundation for achievingsustainable performan...
Contents1.0 Introduction & The Performance Culture Framework ......................................................... 4-7...
1.0 - INTRODUCTION    This guide outlines a process framework for building a performance culture. It’s aframework, not a r...
It’s sometimes overwhelming for leaders to make sense of the ideas from books,magazines, blogs and other great sources. Th...
Figure 2 – Performance Culture Driver Comparison1/2/3The starting point for application is in the areas of stategic & fina...
The strategic & financial alignment and motivation backbone is supported by twoadditional categories of operating drivers....
2.0 - WHY FOCUS ON CULTURE?     I will cover a few foundation concepts about organizational cultures so we have acommon or...
overall framework that is self-sustaining beyond their management. It’s not an easyroad to build clarity and alignment but...
massive restructuring and downsizing effort during the recent financial crisis. Closefriends and colleagues that were actu...
4.0 - THE CULTURE MATURITY MODEL                  THE BEHAVIOR SIDE OF BUILDING THE FOUNDATION    I created the Culture Ma...
As previously mentioned, it’s not effective working on all improvement areas inorganizations at the same time. The foundat...
Figure 5 – Phases, Drivers & Levels of Developing a Performance Culture         The operating drivers in Build the Foundat...
4.0 – Build the Foundation    The process to Build the Foundation will be outlined in 12 steps. You may need towork on con...
4.1 - Build the Foundation: Step 1 – Evaluate Your Current Culture and Performance    I’ll take an abbreviated approach wi...
It was always necessary to use the culture survey results as a foundation fordiscussion and that brings me to the key for ...
he emphasized “products are the motivation,” simple and elegant designs, end to endsolutions, thin is beautiful and the co...
vision as deep as Steve Jobs. I like the following quote from Joel Barker, creator of ThePower of Vision video.   Vision w...
Figure 8 – Expected Behaviors - Example #2    I used large group feedback and prioritization activities to build a set of ...
4.4 - Build the Foundation: Step 4 - Review Core Processes, Including CustomerFeedback Processes     You will not avoid th...
performance culture by tackling these internal frustrations and removing the pain as ateam. It’s still important to make s...
innovation. There were deep concerns about quality. We jumped all over quality first since it hadthe potential to really d...
values; these behaviors will be important with your work on any priorities (step 3). Youhave also moved beyond behavior an...
You should be able to easily explain why the strategic priorities you identify makesense and fit together for your next ph...
Figure 9 – Develop Culture-building “Muscle”    It takes tremendous discipline and persistence to build this capability in...
 Each team moves to a pre-defined area. They work together to answer a positively-  worded question about identifying pri...
worked well / what needs changed to improve) or the team may focus on new prioritiesif sufficient progress is being made (...
We’ll cover the more detailed format for goal tracking in Step 8 (Translate Goalsthroughout the Organization) and the revi...
focused, metric-based performance improvement system we utilized. Laggingindicators measure the end-state, often from a cu...
measures, maintains relevance to the overall goals of the organization and provides themeasurement each one of us needs in...
There was never the intent to capture everything in the format because we hadquarterly goal reviews to discuss current sta...
4.9 - Build the Foundation: Step 9 – Implement a Management System for Priorities &Goals    We’re now to the last three st...
evaluating current status against the plan and measure. Issues or problems may needproblem solved in a logical counter clo...
One important aspect of the approach was the format for departments and cross-functional groups to review progress. I used...
4.10 - Build the Foundation: Step 10 – Implement Communication Habits & Routines     John Kotter identified a key “error” ...
involved and it slows down progress. I immediately began focusing on clarity and thefollowing approaches help: simple summ...
Communication – Applying Cialdini’s Six Principles of Influence   1) Reciprocity – the concept of returning favors. A lead...
4.11 - Build the Foundation: Step 11 – Build Motivation throughout the Process    This framework to build a performance cu...
issues with lower level motivators. You need to clarify how major issues will beaddressed or at least be influenced in the...
behavior is peer feedback and accountability but there still needs to be a rigorous focuson key measures.     When it come...
day he called me and exploded: “you’re from the new school that’s all about hugs andkisses and I am from the old school th...
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
Building A Performance Culture
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Building A Performance Culture

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Building A Performance Culture

  1. 1. Building a Performance Culture- A Guide for Leaders eBook Tim Kuppler
  2. 2. Preface for LeadersThis guide is about building a performance culture as the foundation for achievingsustainable performance improvement. It’s written for leaders with vision, passion, andthe interest in prioritizing and maintaining persistent focus over time. They are alsodeeply interested in engaging the head and the heart of their team in the process andlearning along the way, even from an eBook. These pioneers create the future andaren’t afraid to build an organization that will successfully endure without them. If youare one of these leaders then this guide is written for you. On the other hand, there arecommand and control leaders that feel they don’t have time to relentlesslycommunicate and engage their team. They allow the lack of clarity and alignment, andpotentially even fear, to persist in their organization and will likely HATE this guide.This guide is targeted at two primary applications: A complete roadmap for major efforts to implement a performance culture. A tool for evaluating the operating drivers of your current culture and a best practice guide for leveraging them to improve performance.----------------------------------------------------------------------------------------------------Author Bio:Tim Kuppler led multiple organizations through cultural transformations with a high level of involvement,teamwork and rapid performance improvement. Best practices from organizations he led are featured as partof the recently released book, Leading Culture Change in Global Organizations, International Institute forManagement Development case studies, trade publications, workshops and webinars. He built on thisfoundation when he was President of Denison Consulting, a leader in organizational culture assessment andimprovement that’s worked with over 5000 organizations. Tim consulted a wide variety of organizations as partof Denison and now as part of The Culture Advantage, an organization he formed to focus on the process forbuilding performance cultures. His passion and knowledge about culture change is well grounded in personalexperience as a progressive leader and work with organizations across many industries.Building A Performance Culture, A Guide for Leaders Page 2 of 88www.The-Culture-Advantage.com
  3. 3. Contents1.0 Introduction & The Performance Culture Framework ......................................................... 4-72.0 Why Focus on Culture ........................................................................................................ 8-103.0 The Culture Maturity Model ............................................................................................. 10-134.0 Phase 1 – Build the Foundation .......................................................................................... 14 4.1 Step 1 – Evaluate Your Current Culture and Performance ............................................. 15-16 4.2 Step 2 – Clarify Your Initial Vision ................................................................................... 16-18 4.3 Step 3 – Clarify Values and Expected Behaviors ............................................................. 18-19 4.4 Step 4 – Evaluate Core Processes, Including Customer Feedback Processes ................. 20-22 4.5 Step 5 – Clarify Strategic Priorities .................................................................................. 22-24 4.6 Step 6 – Engage Your Team in Identifying SMART Goals ................................................ 24-28 4.7 Step 7 – Clarify and Track Key Measures ........................................................................ 28-29 4.8 Step 8 – Translate Goals throughout the Organization .................................................. 29-31 4.9 Step 9 – Maintain a Management System for Priorities and Goals ................................ 32-34 4.10 Step 10 – Manage Communication Habits and Routines................................................ 35-37 4.11 Step 11 – Build Motivation throughout the Process ....................................................... 38-39 4.12 Step 12 – Manage Performance ...................................................................................... 39-42 4.13 Overcome Typical Problems Building the Foundation .................................................... 42-455.0 Phase 2 – Expand the Approach ........................................................................................ 45 5.1 Develop a Greater Vision................................................................................................. 45-46 5.2 Build a Culture of Collaboration ...................................................................................... 46-48 5.3 Develop Key Competencies ............................................................................................. 48-53 5.4 Refine your Foundation and Build Collaboration as you Expand the Approach ............. 53-64 5.5 Overcome Typical Problems as you Expand the Approach............................................. 64-676.0 Phase Three – Go Deep ..................................................................................................... 67 6.1 Leverage Leadership Development ................................................................................. 67-69 6.2 Focus Succession Development ...................................................................................... 69-70 6.3 Acquire Talent to Fit Your Developing Culture ............................................................... 70-71 6.4 Refine your Foundation and Drive Innovation as you Go Deep...................................... 71-727.0 Summary and Next Steps .................................................................................................. 73-758.0 Vision for the Future of Culture Work ............................................................................... 76-789.0 Appendix – Operating Driver Evaluation ........................................................................... 79-868.0 References ....................................................................................................................... 87-88Building A Performance Culture, A Guide for Leaders Page 3 of 88www.The-Culture-Advantage.com
  4. 4. 1.0 - INTRODUCTION This guide outlines a process framework for building a performance culture. It’s aframework, not a rigid structure, and should be interpreted that way. You should findvalue in the framework and not necessarily every point of view or specific approach.The concepts apply in all organizations even if the level of structure and formality maybe very different. These concepts have been successfully applied in small businessesand large, diverse global organizations. They are common sense, but rarelycommunicated as part of an overall operating model. The framework for building aperformance culture will be covered in plain language so I’ll spare you the deep analysisand complex philosophies . It’s not a general overview but a thorough and connectedframework reinforced through examples, graphics and repetition. The framework will be covered in three logical phases: 1) build the foundation; 2)expand the approach; and 3) go deep. The foundation is by far the most critical and,suprisingly, many great organizations that apply concepts far beyond what’s covered inthe last two phases of the framework still lack the clear and aligned foundation to makethe most of their comprehensive approach. It’s possible to apply all the concepts in the first phase, Build the Foundation, to justone major improvement priority , or “The One Big Thing,” in order to build momentumand make substantial measurable progress. This guide is not about building momentumrelated to one or two major improvements but the information should still be anexcellent reference if your goal is focused on gaining this initial momentum. Improvinga few initial areas in a very clear way is great but still falls short of the goal of Building aPerformance Culture that delivers sustainable business performance as new challengesand opportunities emerge. This guide covers the entire journey from buildingmomentum through the much deeper actions to anchor improvements in the culture. It’s important to understand the overall framework for building a performanceculture in order to fully understand why the foundation drivers are so critical. You’ll bereturning to the foundation many times when there are major issues managing apriority or as your organization reevaluates priorities and plans over time in response tomarket, resource or other issues. We’ll also focus on further improving this foundationat the end of the phase two and three improvements in this guide.Building A Performance Culture, A Guide for Leaders Page 4 of 88www.The-Culture-Advantage.com
  5. 5. It’s sometimes overwhelming for leaders to make sense of the ideas from books,magazines, blogs and other great sources. They must also deal with countless ideasthey hear from employees, bosses / owners and other stakeholders. A basic frameworkhelps with digesting it all in order to understand how things fit together in anorganization. This guide is organized in three phases over time but all the operatingdrivers we’ll focus on in each phase fit in one or more of four categories:  Strategic and Financial Alignment  Motivation  Talent Management  Core Process ImprovementThese four categories of operating drivers are the focus of this eBook. I will define thesupporting operating drivers but, more importantly, clarify the connections and a logicalsequence for implementation or improvement. They are presented in three phaseswith an emphasis on implementation so the information will ideally be beneficialwhether you are veteran or just starting out with a culture improvement effort. Figure 1 – Performance Culture FrameworkThese four areas of the Performance Culture Framework are not new and they areconsistent with other models, frameworks and concepts from well-known improvementexperts like Stephen Covey, Ram Charan and Jim Collins.Building A Performance Culture, A Guide for Leaders Page 5 of 88www.The-Culture-Advantage.com
  6. 6. Figure 2 – Performance Culture Driver Comparison1/2/3The starting point for application is in the areas of stategic & financial alignment andmotivation.Strategic & financial alignment – the process and supporting structure of priorities andexpectations required to align values, strategic priorities, goals, measures and, mostimportantly, expected behavior with a clear vision for the future of the organization.Motivation – the connection of priorities and expectations to formal and informalsystems to reinforce results and behavior. This includes lower level motivators likecompensation and benefits as well as management and peer recognition that leads tohigher level motivators like pride and the individual sense of being able to make an“impact”. These two areas are the backbone of the process to build a performance culture andmost of the initial work to Build the Foundation is in these two areas. It’s far easier toimprove an organization if there is a very clear sense of priorities and expectatons thatare well-connected to, ideally, higher level motivators so employees give their maximumdiscretionary effort. This basic concept of bringing maximum discretionary effort isoften emphasized in approaches to improve employee engagement.Building A Performance Culture, A Guide for Leaders Page 6 of 88www.The-Culture-Advantage.com
  7. 7. The strategic & financial alignment and motivation backbone is supported by twoadditional categories of operating drivers. These final two areas of the framework aretalent management and core process improvement; the “people” and “process” sides ofdriving change over time. The supporting work in these areas may be very formalizedin large organizations with extensive supporting systems but they are no less critical in asmall businesses that utilize more informal approaches.Talent Management - the systems for development and continual leveraging of talent inthe organization in support of the vision, priorities and expectations.Core Process Improvement – improvement of the primary systems the organizationutilizes for managing work. This includes base management systems for monitoring andmanaging priorities and plans as well as core “operating” processes (sales, production,customer service, etc.) that depend on the type of organization. The four areas of strategic & financial alignment, motivation, talent managementand core process improvement are the primary “operating drivers” of your culture. Allsupporting “operating drivers” we review in this guide fit in at least one of these fourareas. You must understand these “operating drivers” and how they are supported inyour current culture in order to specifically identify what you will need to improve overtime to build a performance culture.Building A Performance Culture, A Guide for Leaders Page 7 of 88www.The-Culture-Advantage.com
  8. 8. 2.0 - WHY FOCUS ON CULTURE? I will cover a few foundation concepts about organizational cultures so we have acommon orientation before diving into the framework for improving them. There aremany definitions of culture ranging from deep insights from Edgar Schein to thecommon definitions referencing values and behaviors. I prefer to just refer to culture as“the way we do things around here.” You can talk to a group of employees in any partof an organization and they often raise similar attributes about how things work at theorganization. There will of course be differences across various sub-groups and teamswithin one organization. These differences make it even more difficult to build aconsistent foundation due to all the leaders and personalities involved. With all ofthese complexities, culture is still critical because it influences every strategy and plan ofan organization. It’s also not easy to change culture in a way that endures. LouisGerstner, architect of IBM’s turnaournd in the 1990’s said, “the thing I have learned atIBM is that culture is everything.” He has another quote that’s not as well known but Ilike even more: “the hardest part of a business transformation is changing the culture.”1 So why is culture change so hard? John Kotter identified a well-known eight stageprocess of creating major change.2 The steps range from creating a sense of urgency tocommunicating the change vision and empowering broad based action. The eighthstage is “anchoring new approaches in the culture” where he references theimportance of customer and productivity-oriented behavior, improved leadership andmore effective management. He also stresses the need for articulating the connectionbetween these behaviors and the success of the organization along with ensuring thebehaviors are factored in leadership development and succession activities. Building aperformance culture requires a connected framework of numerous major changes thatmust avoid the pitfalls that undermine most change efforts. A sufficient number ofthose changes, not all, must also be anchored in the culture in order for them to supportsustainable performance improvement. Few leaders have the patience, persistence andtotal commitment to positive actions going forward that’s necessary to endure drivingand connecting all the changes required for a major culture transformation. Mostleaders will just give up. They will not “give up” in the sense of stopping their focus ondriving change or facilitating major improvements. They will “give up” on engaging theentire organization in the process and connecting those major changes as part of anBuilding A Performance Culture, A Guide for Leaders Page 8 of 88www.The-Culture-Advantage.com
  9. 9. overall framework that is self-sustaining beyond their management. It’s not an easyroad to build clarity and alignment but it’s absolutely worth the journey. Culture change efforts are well worth the frustrations, roadblocks and downrightpainful experiences people have along the way due to two main reasons. The first is thereason communicated by most: there is extensive research confirming the link betweenculture and performance. Improvements in sales, profit and the overall value oforganizations have been well documented by researchers from many perspectives. Thisguide is not about the research or deep analysis of the components of a culture. It’sabout the process to improve culture but the second reason why culture change effortsare “worth it” is very important for the process. The absolute key to this process of building a performance culture is the focus on increasing the individual and collective understanding of how to make an IMPACT.The fundamental concept supporting the entire process I’ll share to build a performanceculture is related to IMPACT. You are building the capability of individuals and teams inyour organization to have an impact. They learn approaches they will apply to have agreater impact on the results of their work and they will understand how that work isconnected to the success of the organization in a more direct way. Each one of usdesires to make an impact at work and in our personal lives, sometimes there isn’t evena clear division between the two. We learn the most about how to make an impact bybeing part of improvement efforts and contributing through the work we directlycomplete and the feedback we provide to help others. The beauty is that many of thethings we learn to make a greater impact at work translate to our lives at home and withall the other organizations we interface with outside of work. We’re then moreequipped to have an impact at work and beyond as we learn over time. I have beenthrough some pretty difficult situations as a leader. One of the most difficult was aBuilding A Performance Culture, A Guide for Leaders Page 9 of 88www.The-Culture-Advantage.com
  10. 10. massive restructuring and downsizing effort during the recent financial crisis. Closefriends and colleagues that were actually doing a great job were let go because we hadto downsize the overall organization and make some tough choices. One personthanked me after he was let go and specifically referenced how he applied what he hadlearned at home and it really made a difference with his family. Others thanked mebecause they learned about their strengths and realized they were better suited tomake an impact in a different career. The positive feedback comes through in toughcircumstances but that’s only after change efforts have produced positive progress,results and countless learning points over time. Another exciting part of the approach is that team members learn how to make animpact within the context of an aligned culture instead of being overcome by thecontinual stresses of an ineffective culture. Clarity and alignment reduces stress on youas a leader and every member of your team. There is a natural health and wellnessbenefit as individuals, teams and your organization learn to have an impact the “right”way. Positive progress where individuals and teams really learn how to make a greaterimpact builds pride and confidence, individually and collectively. The pride leads to agreat sense of positive energy in the organization and the confidence helps people seechange efforts through with greater focus and persistence. Employees don’t justunderstand “how,” they leverage that understanding by taking action. The process tobuild a performance culture increases the individual and collective capability of anorganization to make an impact through proactive action together. The impact can bemeasured through financial performance and other measures of organizationaleffectiveness and is also evident with the organization’s customers, communities andother stakeholders. The hard part is that employees across the organization should beable to describe “how” they make an impact and “why” it’s connected to a positiveimpact on the organization. We’re working to imbed changes in the culture so theknowledge of “how” and “why” must be continually reinforced and developed. I didn’tsay clarity and alignment was going to be easy but this guide addresses how to clearlyengage the head (how / why) and the heart (pride / confidence / impact) of youremployees.Building A Performance Culture, A Guide for Leaders Page 10 of 88www.The-Culture-Advantage.com
  11. 11. 4.0 - THE CULTURE MATURITY MODEL THE BEHAVIOR SIDE OF BUILDING THE FOUNDATION I created the Culture Maturity Model to allow for a quick evaluation of where anorganization may fit as they develop their performance culture over time. It’s a generalframework so an organization will not necessarily experience every quality listed in thecategory of the model where they appear to fit. Figure 3 – Culture Maturity Model The phases of this guide are designed to move an organization across the levels ofthe Culture Maturity Model. Phase one, Build the Foundation is focused on movingfrom Reactive (level 1) to Functional (level 2). Phase two, Expand the Approach, isfocused on moving from Functional to Collaborative (level 3). Phase three, Go Deep, isabout moving from Collaborative to High Performance (level 4). The goal is to help yourorganization move along one level at a time so work progresses in logical phases. Figure 4 – Phases for Developing a Performance CultureBuilding A Performance Culture, A Guide for Leaders Page 11 of 88www.The-Culture-Advantage.com
  12. 12. As previously mentioned, it’s not effective working on all improvement areas inorganizations at the same time. The foundation needs to be in place to support thehigher order operating drivers we’ll cover in phase two and three. Some organizationsmay already have systems in place for some of these higher level operating drivers butstill struggle due to issues with their foundation. Phase two and three are all aboutsustainability but they will not have the intended impact without a strong foundation.An obvious example is the transition from Build the Foundation to Expand theApproach. Expand the Approach is all about growing collaboration. This collaborationwill be chaos if you haven’t clarified expectations and priorities first and engaged theorganization around building momentum on the top 1-3 priorities, the focus of Build theFoundation. Phases in a Nutshell Phase 1 – Building the Foundation: Build clarity and alignment around the top 1-3 priorities and move to the functional stage as the organization learns the behavior necessary to build positive momentum as a team. Phase 2 – Expand the Approach: Leverage the concepts learned in Phase 1 to support a greater vision for the future with emphasis on highly effective collaboration and developing key supporting competencies. Phase 3 – Go Deep (for sustainable performance): Implement more advanced improvement approaches as a team that support the greater vision with innovation and speed. Manage the continual development of leaders, succession development and hiring practices that emphasize cultural fit to embed changes in the culture over time to achieve sustainable performance improvement. Note: Re-assess and reinforce the foundation with phase transitions and when the organization experiences major changes over time (new top leader, major environment / market changes, etc.).Specific operating drivers are defined that are the focus of work in each phase. Thesedrivers are highlighted in Figure 5 – Phases, Drivers and Levels of Developing aPerformance Culture. These areas may be supported formally or informally but they areimportant concepts for all organizations.Building A Performance Culture, A Guide for Leaders Page 12 of 88www.The-Culture-Advantage.com
  13. 13. Figure 5 – Phases, Drivers & Levels of Developing a Performance Culture The operating drivers in Build the Foundation are the most critical for initialwork and when an organization struggles with clarity and alignment over time. Theseoperating drivers also continue to be developed or “refined” as listed in figure 5 as theorganization moves through the phases of Expand the Approach and Go Deep. Thisguide includes far more detail regarding the drivers in Build the Foundation due to theircontinued emphasis through all three phases of the journey. The additional operatingdrivers in phase two and three are more advanced so I’ll only provide a generaloverview of each with a special emphasis on why each is important for building aperformance culture.Building A Performance Culture, A Guide for Leaders Page 13 of 88www.The-Culture-Advantage.com
  14. 14. 4.0 – Build the Foundation The process to Build the Foundation will be outlined in 12 steps. You may need towork on connecting all 12 if you have major clarity and alignment issues. It may help toreview the 12 steps below in order to identify areas that are already effectivecharacteristics of your operating model with strong clarity and alignment. Feel free toskip those steps of the process to focus on the areas you know you need to improve.  Step 1 - Evaluate Your Current Culture & Performance  Step 2 - Clarify Your Initial Vision  Step 3 - Define Values & Expected Behaviors  Step 4 - Evaluate Core Processes, Including Customer Feedback Processes  Step 5 - Define Strategic Priorities  Step 6 - Engage Your Team in Defining SMART Goals  Step 7 - Define and Track Key Measures  Step 8 - Translate Goals throughout the Organization  Step 9 - Connect and Support Measures through Dashboards  Step 10 - Implement a Management System for Priorities & Goals  Step 11 - Build Motivation Throughout the Process  Step 12 - Effectively Manage Performance The first step is evaluating your current culture and performance. You’ll learn manythings about how to customize the approach in the remaining steps if you prioritizeissues in this step. Remember, this is a framework and it will help to focus on how eachstep fits in the overall model versus critiquing the specific language or examples I’ll useto explain each step. You may have sufficiently covered some steps in your organizationso focus on filling in the gaps and understanding the overall flow and connections. Thesteps are only intended to support a logical explanation. Supporting work may becompleted in parallel. Some of you may say “we do all of these things” in Building the Foundation but youstill have a lack of clarity and alignment. If so, scan this section to see where thestructure may differ because the issue may be with the individual “operating drivers” orhow some are being led and connected from a behavior standpoint to engage yourorganization in the process.Building A Performance Culture, A Guide for Leaders Page 14 of 88www.The-Culture-Advantage.com
  15. 15. 4.1 - Build the Foundation: Step 1 – Evaluate Your Current Culture and Performance I’ll take an abbreviated approach with explaining this step because it’s possible to govery deep. The starting point for understanding your current culture is clarifying inbroad terms the context. Current Context Questions  What are the key challenges your organization is facing?  What are the strengths and weaknesses of your organization?  How is your organization performing in meeting financial expectations and other expectations of your customers, employees and other stakeholders?  How are any weaknesses impacting your performance?  When you think about changing “how things work around here” what stands out as critical priorities for improvement or major frustrations? Many organizations build on this basic understanding of context to help you designa culture assessment. Culture surveys typically involve an output of results in genericlanguage because a common foundation of survey questions is used across manyorganizations. This common foundation will allow you to not only understand andmeasure strengths and weaknesses in your own culture but also how they compare toother organizations. They are very beneficial for gaining a quick and organizedsummary of your current culture. I liked using them because they allowed me to engagethe entire organization in the process. We quickly developed a common language todefine various aspects of our culture and to measure it across the organization. Thereare many survey providers and they each define culture with a different language. Figure 6 – Sample of Culture Survey Providers and Results CategoriesBuilding A Performance Culture, A Guide for Leaders Page 15 of 88www.The-Culture-Advantage.com
  16. 16. It was always necessary to use the culture survey results as a foundation fordiscussion and that brings me to the key for understanding your current culture at anoperating level. Culture survey or not, you’ll still need to understand the “operatingdrivers” of your current culture. The operating drivers help clarify “why” your culture isthe way it is and the specific areas where changes will need to be focused to move yourculture and performance. You’ll need an awareness of why strengths and weaknessesexist in your organization to fully leverage the strengths and to begin addressing themost critical weaknesses. Culture surveys will help to provide key insights to customizethe approach of evaluating and improving your operating drivers but this deeperevaluation is still necessary. Add to your general definition of the current context identified from the questionsat the start of this section as you evaluate, in broad terms, the four areas of “operatingdrivers” in the Performance Culture Framework: Strategic and Financial Alignment: Are priorities, goals and measures clear and aligned across all parts of your organization with a strong connection to your key financial metrics? Motivation: Is there a strong sense of motivation stemming from higher level motivators like management recognition and peer recognition that leads to pride where employees strongly believe they make a positive impact? Core Processes: Is there substantial “pain” managing the work in your core processes? If so, what core processes not only have “pain” but are having the greatest impact on your performance? Talent Management: Does your team have the talent and capabilities you need to succeed and are team members continually building their capabilities in the key areas you need?Taking stock in understanding your current culture and the performance of yourorganization is very important as you assess your vision for the future.4.2 - Build the Foundation: Step 2 – Clarify Your Initial Vision Did you know Apple doesn’t publicize a Vision statement? Is there any questionthat Steve Jobs was a visionary? Apple has a mission statement that’s changed manytimes over the years as they rolled out new products but the vision of Steve Jobs wentfar beyond any documented statement or summary. He built a culture that supportedhis vision in countless ways. He had incredible vision for a group of “wickedly smartpeople” working with passion, relentless persistence, innovation, deep collaboration,focus and prioritization among other expectations. He had vision for their products asBuilding A Performance Culture, A Guide for Leaders Page 16 of 88www.The-Culture-Advantage.com
  17. 17. he emphasized “products are the motivation,” simple and elegant designs, end to endsolutions, thin is beautiful and the computer as a digital hub.1 At this point of building the foundation, it’s not necessary to have a grand and all-encompassing vision of the future and a simple vision statement is not good enough. Itmay be fine to skip this step if you already have a clear vision that’s well understood andmotivating for your team. The initial vision should capture the obvious and clarify a fewkey areas that will be the focus going forward with “how things work around here.”There will be time later for the grander vision as the organization is fully engaged in theprocess so I only refer to this as an initial vision. Momentum needs to be built around afew key areas whether they were highlighted during a culture assessment or a generalreview of how your organization is performing. This vision will serve as the foundationfor clarifying strategic priorities and plans so it’s completely fine for it to be relativelygeneric. It’s not a vision statement so I’ll refrain from listing examples but I will share acouple stories. I led one organization that was clearly in need of a turnaround. There were majorissues on the financial front and the historical culture was all about command andcontrol. The initial vision was not about market leadership, new innovations or someaggressive growth strategy. It was all about stabilizing the business and building a newteam. It was clear in meetings with the Leadership Team and in communications acrossvarious sites that we were going to focus on a few key priorities defined as a team andwe would be managing them in an entirely new way. We defined some basic expectedbehaviors for managing objectives as a team and I shared some stories aboutapproaches I used in the past while still making it clear we would define the pathforward together. Our focus on stabilizing the business and building a team took aboutsix months until we had firmly implemented the approaches behind the 12 steps in thisguide for Building the Foundation. Another organization I led was in a completely different situation. We had madeprogress as a team in North America but my responsibilities were expanded to includethe global business. The business was performing well so the vision wasn’t aboutstabilizing the business but there were clearly some threats for the future. Our saleswere almost entirely concentrated with one customer. The good news was that therewas not a clear global leader in our market so there was definitely hope to expand toother customers. The vision for this organization was all about building a new globalteam, diversifying the customer base and becoming the market leader. We clarifiedsome of the approaches we would use to build the team and the behaviors that wouldbe important for all team members. Your vision may be more specific or thorough than these examples but it’simportant to have an overall vision defined by the leader or top team, even if it’s not aBuilding A Performance Culture, A Guide for Leaders Page 17 of 88www.The-Culture-Advantage.com
  18. 18. vision as deep as Steve Jobs. I like the following quote from Joel Barker, creator of ThePower of Vision video. Vision without action is a dream. Action without vision is simply passing the time. Action with Vision is making a positive difference. Joel Barker24.3 - Build the Foundation: Step 3 – Define Values and Expected Behaviors Some of you may be thinking this step is about a very loose and general framework.It’s definitely not; the foundation of behavior reinforces everything in this guide. Inmost cases this work is a combination of clarifying values and supporting “expectedbehaviors.” I found the expected behavior step to be critical because everyoneinterprets values from their own perspective. The step to clarify expected behaviorstakes more work but it’s important for the entire process. Richard Barrett from theBarrett Values Center recommends asking “what behaviors would be showing up if wewere living these values.”3 Your vision may not need to be clearly captured in a statement but I stronglyrecommend you document expected behaviors or capture them in some way toaccelerate progress. Some organizations go to the extent of clarifying key principles,values, codes of conduct and beyond. One of my favorite examples is from theContainer Store. They have a series of “foundation principles” and videos withemployees explaining each principle in their own words.4 Here are a few otherexamples: the “Service Values” from Ritz Carlton and a second generic example. Service Values: I Am Proud To Be Ritz-Carlton 1. I build strong relationships and create Ritz-Carlton guests for life. 2. I am always responsive to the expressed and unexpressed wishes and needs of our guests. 3. I am empowered to create unique, memorable and personal experiences for our guests. 4. I understand my role in achieving the Key Success Factors, embracing Community Footprints and creating The Ritz-Carlton Mystique. 5. I continuously seek opportunities to innovate and improve The Ritz-Carlton experience. 6. I own and immediately resolve guest problems. 7. I create a work environment of teamwork and lateral service so that the needs of our guests and each other are met. 8. I have the opportunity to continuously learn and grow. 9. I am involved in the planning of the work that affects me. 10. I am proud of my professional appearance, language and behavior. 11. I protect the privacy and security of our guests, my fellow employees and the companys confidential information and assets. 12. I am responsible for uncompromising levels of cleanliness and creating a safe and accident-free environment. Figure 7 – Expected Behaviors - Example #15Building A Performance Culture, A Guide for Leaders Page 18 of 88www.The-Culture-Advantage.com
  19. 19. Figure 8 – Expected Behaviors - Example #2 I used large group feedback and prioritization activities to build a set of expectedbehaviors in many organizations. It’s amazing how people start recognizing thebehaviors more consistently when they are engaged in the process to define, or at leastclarify, their core values and expected behaviors. A reality check is needed as you finalize expected behaviors. The list or summaryshould not look like it’s for a completely different organization. You should see somecultural strengths shining through you will leverage as you focus on shifting a few keybehaviors critical for your future culture. Jon Katzanbach, culture change guru withBooze & Co., recommends a focus on improving no more than three to five behaviors6but I really wonder if that’s realistic unless they fit together in a couple families. Irecommend focusing on behavioral strengths that already exist in the organization plusone to three additional behaviors that will be important as you Build the Foundation.Building A Performance Culture, A Guide for Leaders Page 19 of 88www.The-Culture-Advantage.com
  20. 20. 4.4 - Build the Foundation: Step 4 - Review Core Processes, Including CustomerFeedback Processes You will not avoid the discussion of “how we do things around here” from aprocess standpoint as you develop your strategic priorities in the next step. It can’t justbe about behavior because your processes reinforce and support certain behaviors.Your management system (step 9) that supports tracking progress towards goals is animportant core process we’ll cover later but you have other core processes forsupporting the products and/or services you provide to your customers. When buildingor improving a performance culture, it’s always important to understand where there is“pain” in managing your core processes. We have all felt that process pain andfrustration in organizations. Initial momentum is built by engaging the organization inidentifying the pain, prioritizing areas to be addressed and then engaging your teamagain to lead improvement in a those key areas (through goal & measure management –covered in subsequent steps of this guide). It’s often more about evolving orimproving a core process with common sense changes versus new major innovationsfrom a process standpoint. I loved hearing feedback like “we’ve wanted to change thisfor years” or “this has always been a problem.” Long service employees are a greatsource to engage in determining process problems that have “always been that way.” The dialogue about strategic priorities and goals, in the next step, should involve anunderstanding of core process issues that are impacting current performance. Thesecore processes need understood at a high level so it’s not about detailed process re-engineering when building a stronger foundation. There is a place for that later in theeffort to build a performance culture. The key at this point is the focus on general coreprocesses for your organization. They might include your sales process, customerservice process, production process or other core processes that are important forsupporting your strategic priorities. Strategic priorities and / or supporting goals needto address removing the top areas of pain. Feedback and prioritization efforts work wellto narrow in on the key areas that need addressed as a team. Involvement meetings,also covered in the next step of this guide, are an example of an approach to engage theorganization in the process to quickly identify the top areas of pain. Objectives focused on core process improvement should have an impact onimproving the overall process in a way that improves performance in a measurable way.I am raising this point with some hesitation because there may not be a discretemeasure for removing frustration from your organization. We love it when frustration isremoved from our work processes. It’s even a bigger deal if those frustrations havebeen there for a long time. General feedback and prioritization efforts often surfacesome of the biggest internal frustrations. You’ll help gain momentum in building yourBuilding A Performance Culture, A Guide for Leaders Page 20 of 88www.The-Culture-Advantage.com
  21. 21. performance culture by tackling these internal frustrations and removing the pain as ateam. It’s still important to make sure any emphasis on process improvement isn’ttotally focused internally. All processes are not equal. A foundation process for allorganizations is your customer feedback process. There is only one boss. The customer. And he can fire everybody in the company from the chairman on down simply by spending his money somewhere else. Sam Walton Every organization needs fundamental customer feedback processes and most havethem in some form. They could be systems related to overall satisfaction, complaints orsome other more general system. The effort to review core processes as a foundationfor strategic priority and goal development should involve a review of your customerfeedback processes at a minimum. There is no point of putting energy into creating anddelivering new products and services or some other future-oriented priority if the houseis burning and customer satisfaction is a major problem. The entire organization needsto understand how customers view the organization. Basic measures like complaints orother satisfaction measures should be highly publicized. Core processes that impactthose measures need to be evaluated in order to understand root causes for the issuesand to prioritize improvement efforts that remove “pain” from your customers too. Thecustomer “pain” has absolutely spread to your employees that support those processes.They will love being engaged in the process to remove the pain and satisfy customers. The initial identification of where to focus the effort related to your strategicpriorities and supporting goals may come from high level customer feedback and not adetailed supporting system. Ask major customers to prioritize the areas yourorganization needs to improve. The efforts to improve your organization need to bevisible to your customers. Your organization will highlight improvements needed incountless areas of your organization. Many of these areas are not visible problems toyour customers. Unfiltered customer feedback cuts through the noise to the criticalareas where change would clearly be noticed by your customers. The followingexample clearly highlights the power of connecting with your customers as part of theprocess to define your strategic priorities. Linking Customer Feedback to Strategic Priorities and Building a Performance Culture I moved to a new organization and quickly reached out to meet some of our top customers. Ifocused the discussion on how things were going in general but shifted it to engage them in clearlyidentifying the top areas we needed to improve. The common themes were quality andBuilding A Performance Culture, A Guide for Leaders Page 21 of 88www.The-Culture-Advantage.com
  22. 22. innovation. There were deep concerns about quality. We jumped all over quality first since it hadthe potential to really damage the relationship. Innovation wasn’t realistic as a starting point sincethere would be no trust behind our delivery of new innovations even if they were in the pipeline.We engaged our entire leadership team and large parts of our organization in a process tobrainstorm, prioritize and commit to the top goals we would focus on to drive our improvement.It took about six months to engage the entire organization in the process in a very positive way andfor there to be substantial progress evident with our leading and lagging indicators. Customerscame to our facilities and could see the visible change in many areas but the key was the alignedmessage about “how things worked around here” on the quality front that gave them confidencein our organization. We were then able to learn from that process to improve our approach for managinginnovations (in our case it was new product development) in the same way. Each of the 12 steps inBuilding the Foundation was important for the process. We utilized feedback and prioritizationactivities in an involvement meeting with our team that was focused on what went right and whatwent wrong with our management of the quality strategic priority. We defined the priorities weneeded to take from that experience and apply to improve our plans supporting the innovationstrategic priority. This aspect of organizational learning is critical for the process of building aperformance culture over time so performance improvement is sustainable as new problems,market changes or opportunities come up. It’s far beyond a basic lessons learned system becausethe changes are firmly embedded in the operating structure of the organization and immediatelyapplied to another strategic priority with very high visibility. We ended up delivering substantialnew innovation in a product line that had remained virtually unchanged in 25 years. It took about 12 months for there to be a turnaround on both priorities identified by ourcustomers. Both areas improved to the point where our major customers were not only providingpositive feedback but sharing our success with major competitors telling them “we had movedahead” and “they better watch out” for our company. Unfiltered feedback from customers at thestart of the effort and along the way was just as important as the highly visible measures ofprogress (in every communications meeting, on our intranet, etc.). We shared our disciplinedapproach with our customers throughout the process and we even communicated the approachheavily in our marketing (in advertisements, with supporting highlights, titled: “A New Direction”and “Feel the Change”). I probably wouldn’t have pushed the link to advertising if I hadn’t beenthrough this journey many times before but I had total confidence in our team to deliversubstantial positive change together.4.5 - Build the Foundation: Step 5 – Define the Strategic Priorities The decisions you make to clarify strategic priorities are powerful because they setthe stage for goal translation throughout your organization. Feel free to skip this step ifyou have a few clear customer-driven strategic priorities. If you haven’t clarified 3-5 keystrategic priorities throughout your organization then this is the start of bringing thingsback into focus. Let’s recap the steps to this point: You have reviewed your currentbusiness performance and current culture (step 1) as a foundation for clarifying yourinitial vision (step 2). You have defined expected behaviors that support your vision andBuilding A Performance Culture, A Guide for Leaders Page 22 of 88www.The-Culture-Advantage.com
  23. 23. values; these behaviors will be important with your work on any priorities (step 3). Youhave also moved beyond behavior and evaluated your processes for performing work,especially your customer feedback processes (step 4). You now need to engage yourleadership team and, ideally, a much larger part of your workforce to clarify the topstrategic priorities. The foundation you are building will be laser focused on these key strategicpriorities. You’ll be engaging your organization with intense focus on these areas in anew way that will also move your culture over time. Your entire organization will learnfrom the process of how to manage work more effectively and will apply concepts andapproaches to other areas over time. You will build momentum for your culture changefrom initial progress on a few well-defined and supported strategic priorities.Keep the following areas in mind when defining your top 3-5 strategic priorities. Theyshould:1. Engage a large cross-section of your workforce so your extensive effort to build a performance culture will directly touch the daily work of your entire team.2. Cover any major areas that are deteriorating your credibility with customers. You need a strong foundation of customer feedback and improvement since customers will not wait around for their fundamental needs to be covered later (Note: the evaluation of the customer feedback process was covered in step 4).3. Address major core process issues (also identified in step 4) that are consuming the time and energy of the organization and driving major frustrations4. Place priority on any urgent areas necessary to stabilize serious financial problems. Building a performance culture must not be in conflict with a relentless focus on the numbers. Some leaders may not be around past Building the Foundation if the numbers don’t improve.5. Note: Hold off on more innovative priorities if those related to your customers and financial foundation are weak. These priorities will be the focus for at least 6-12 months but you’ll have time and the cultural foundation to move on to more innovative approaches later. Advanced priorities like LEAN, CRM, very innovative new products or services, new technology and other areas may not have the foundation of clarity and alignment to take hold. Far too many organizations think these progressive approaches are the solution but they will fail if they are not firmly integrated with the foundation of priorities and expectations that cross all areas. It’s difficult to build this strong foundation across major areas and implement sustainable leading-edge improvements at the same time.Building A Performance Culture, A Guide for Leaders Page 23 of 88www.The-Culture-Advantage.com
  24. 24. You should be able to easily explain why the strategic priorities you identify makesense and fit together for your next phase of improvement together as a team. It alsohelps to engage large parts of your organization in the process to define or confirm yourstrategic priorities. You’ll be developing a clear set of goals to support your strategicpriorities in the next step of the process. A great technique is to integrate your vision and strategy work by clarifying your“strategic vision” as part of a story. This approach is extremely powerful andcompelling. The typical complexity of vision and strategy work falls away if you are ableto clarify them as part of one clear story. Grainger was able to bring their strategicvision to life as part of a humorous, interesting and highly effective video7. It was fareasier for the key aspects of their vision and strategy to take hold and spreadthroughout the organization when they clarified the strategic vision of the organizationin a clear story and associated video. You may choose to use other approaches than avideo but the story approach engages the head and heart of the organization more thanany lists or specific descriptions.4.6 - Build the Foundation: Step 6 – Engage your team in defining SMART goals Your prioritization work will continue as you engage your team in the process todefine SMART goals that support each of the strategic priorities defined in Step 5. As arefresher, SMART goals are:  Specific – focused, logical, clear and top priority supporting a broader strategy.  Measurable – key for measuring progress (covered in detail in step 7)  Attainable – Aggressive but developed with feedback to make sure they are realistic  Relevant – They need to make a difference – for customers, your team, financially…  Timely – a maximum of 6-12 months You’ll need to engage a broad team at the start of this process. Your work on theseinitial goals will develop the “culture-building muscle” of your organization and enableyou to effectively engage your team on countless other priorities and goals in the future.The concept of “culture-building muscle” is extremely powerful and it includes four verybasic steps (see figure 9):  Engage a team in brainstorming improvements.  Prioritize the top ideas as a team with no big analysis.  Translate the top ideas to SMART goals for ongoing tracking.  Track progress as a management team but intensely focus on supporting actions related to the goals and visibly recognize positive progress as a team.Building A Performance Culture, A Guide for Leaders Page 24 of 88www.The-Culture-Advantage.com
  25. 25. Figure 9 – Develop Culture-building “Muscle” It takes tremendous discipline and persistence to build this capability in yourorganization but it’s a basic approach you will return to in times of crisis and in othersituations that require quick and aligned action from your team. My favorite approach to build this capability quickly is an “involvement meeting.” Iused the approach over 100 times as a leader and consultant. The purpose is to engagethe participants in clarifying priorities and plans as a team. It requires a timecommitment (typically 4-6 hours for a thorough meeting) but it’s one of the best waysto build clarity and alignment quickly as a foundation for the remainder of the steps inthis process. An involvement meeting should involve a few leadership levels of theorganization at a minimum but the concepts work with individual leadership teams andany other team. Some organizations have top 100 meetings or even larger meetings toengage personnel from all sites while small businesses might engage all of theiremployees. I prefer starting the meetings with a clear “state of the business / organization” as afoundation for multiple feedback and prioritization sessions as a team. This is the timefor the leader to share their impressions of the current state (step 1) and their overallvision of the future (step 2). The leader shares their vision and, potentially, the keystrategic priorities that will be the focus for the session. Break-out groups are identifiedto engage in feedback and prioritization as a team. I like utilizing appreciative inquirytechniques with a focus on creating the future versus problem solving approaches to“fix” various areas. The teams are asked to identify supporting goals or priorities in akey area of the organization. I have used many approaches to structure these sessionsand the following routine seems to work the best:Building A Performance Culture, A Guide for Leaders Page 25 of 88www.The-Culture-Advantage.com
  26. 26.  Each team moves to a pre-defined area. They work together to answer a positively- worded question about identifying priorities to improve a particular area of the organization (a strategic priority or a major supporting priority) Each team starts by brainstorming improvement options and listing them on a flip chart (no long debates) Each team then agrees, through voting or debate, on the top 2-3 priorities for improvement and identifies each on the flip chart (circling, identify with star, etc.) Each team briefly reports out on only their top 2-3 priorities (2-3 minutes per team) The feedback from all teams is consolidated on a few flip charts (only the 2-3 priorities identified by each team) These flip charts are posted in a central area and all attendees vote on the overall priorities for improvement (using stickers or markers during a break or over lunch). Multiple strategic priorities or improvement areas may be covered in one meeting. The involvement meeting approach isn’t giving up leadership and letting theorganization run everything. It’s very important for leaders to “set the stage” fordiscussion about each subject so the break-out activities have the right focus. I haveattempted to think through the priorities I thought my organization would highlight aspart of the process. It never ceases to amaze me how this process naturally covers theobvious priorities but the participants typically go beyond the obvious and highlight newinsights and approaches that make a tremendous impact on the plans going forward.The feedback from these meetings serves as the foundation for well-documentedSMART goals that are tracked over time. I spent nearly 10 years holding these types of meetings at least every six months inmultiple segments of the overall organization I was leading at the time. My early careerhelped me realize the potential power of these forums. I had attended numerous largegroup leadership meetings before being promoted to a general management position.It always used to frustrate me about the lack of clarity around next steps that wouldcome out of these meetings or how the next “big meeting” would end up with the sameissues and problems being highlighted. I was committed to making sure the people Iled would not have the same feeling from group meetings they attended. The key is toconnect one meeting to the next with great discipline. The meeting ends with the topleader clarifying the next steps about how the priorities will be translated to specificgoals and plans. They also clarify how the organization will be updated on progress.The “state of the business / organization” the top leader gives at the beginning of thenext meeting includes a recap of what was decided on in the last meeting and an honestassessment of current status. The feedback and prioritization activities are then focusedon further improving work on some of the same priorities from the last meeting (whatBuilding A Performance Culture, A Guide for Leaders Page 26 of 88www.The-Culture-Advantage.com
  27. 27. worked well / what needs changed to improve) or the team may focus on new prioritiesif sufficient progress is being made (often it’s a combination of both). It doesn’t matter if you use an involvement meeting or some other approach toengage your team in the process of clarifying the top goals that support each strategicpriority but it is critical to engage your team. Top-down and dictated priorities don’t goover well if the people leading the work on those priorities are not involved in theprocess. Involvement meetings and other approaches engage the head AND the heart. The top goals of the organization need documented in a clear way. It’s fine to use adetailed format for tracking goals but I also prefer to use an overall dashboard with acolor rating for each major goal. Some people hate color ratings due to potentialdebate about status (a focus on the color versus the goal). We just had a rule that theleadership team would agree on the rating and the lower color would be used to avoidany big debates. I first saw the format we ended up using during a World WidePurchasing meeting at General Motors. There were three overall strategic priorities andthree to five major supporting goals for each. See figure 10 for the general format. Iliked how it allowed for a very fast and visual sense of not only the priorities but thecurrent status for each one and the key supporting goals. I used this type of visualsummary in every monthly communications meeting and posted status on the frontpage of our company intranet. Remember my earlier point about connecting individualimpact to the impact the organization is making. It’s difficult to even understand theconnection, let alone support it, if you don’t have a clear understanding of the top goalsof the organization. Repetition and consistency helps so define clear habits for sharingstrategic priorities and progress on supporting goals regularly. Figure 10 – Strategic Priority Dashboard ExampleBuilding A Performance Culture, A Guide for Leaders Page 27 of 88www.The-Culture-Advantage.com
  28. 28. We’ll cover the more detailed format for goal tracking in Step 8 (Translate Goalsthroughout the Organization) and the review process for goals in Step 9 (Implement aManagement System for Priorities and Goals).4.7 - Build the Foundation: Step 7 – Define and Track Key Measures Clear measures should be defined for each of the top goals of the organization.Measures are important so there is a clear and quantifiable approach to trackingprogress towards each goal. Some goals lend themselves to quantifiable measuresmore easily than others. A format I like for tracking financial and other straightforwardmeasures is identified in figure 11. The three year history, monthly trend (in $ and %)and comparison to plan or target is a great format to utilize as a foundation inleadership team meetings (see step 9 – Implement a Management System for Prioritiesand Goals) and for communication in the organization (step 10 – ImplementCommunication Habits and Routines). There are of course countless formats that workbut communicating data in a clear format is important as you teach your organizationabout the measures as a foundation for feedback, prioritization and monitoring progressover time. Figure 11 – Example Measure Format Another important concept for building an effective measurement system is toutilize a structure of leading and lagging indicators. I first learned about this conceptand the rigorous tracking of goals from one of my first mentors that took a deep interestin helping me learn, Mike Vella. We ended up co-authoring a case study on a customer-Building A Performance Culture, A Guide for Leaders Page 28 of 88www.The-Culture-Advantage.com
  29. 29. focused, metric-based performance improvement system we utilized. Laggingindicators measure the end-state, often from a customer or financial perspective. Theyare very important because they show the result of the work of the organization. Theyunfortunately are “after the fact” measures so there is benefit to connecting them toleading indicators. Leading indicators may be used in combination with laggingindicators in order to focus on measures that will be predictive in some way on the end-state or lagging indicator. If there is a strong connection between leading and laggingindicators then improvement in leading indicators should result in lagging indicatorimprovement over time. Leading indicators are extremely important when it comes togoal translation deep in the organization. Different parts of the organization are able tofocus on the measures they influence and not measures at a higher level where theconnection to their work is not clear. Figure 12 – Leading and Lagging Indicator Examples8 This additional focus on leading indicators must be balanced with the laggingindicators that show the final results of the work of the organization in the eyes of thestakeholders; both are important.4.8 - Build the Foundation: Step 8 – Translate Goals throughout the Organization The process to translate goals throughout the organization is similar to the conceptwe just reviewed on leading and lagging indicators. In step 6, we covered theimportance of developing SMART goals in support of the strategic priorities. These goalsshould be supported by measures (step 7) and they also need translated to supportingSMART goals in departments, teams, divisions, locations or however you are organized.This may not be necessary in small businesses that may focus on one set of goals andmeasures for all. The key is for all employees to understand the goals and measures for the work theyperform. Patrick Lencioni wrote The Three Signs of a Miserable Job and two of the three“signs” were related to employees feeling a lack of relevance and a lack ofmeasurement.9 Proper goal translation, including the connection to supportingBuilding A Performance Culture, A Guide for Leaders Page 29 of 88www.The-Culture-Advantage.com
  30. 30. measures, maintains relevance to the overall goals of the organization and provides themeasurement each one of us needs in order to know if we are making progress. Bothaspects, relevance and measurement, are key together in order for a person to feel theyare having an impact that really makes a difference. Documenting goal and measure translation is extremely important. There are veryrigid approaches to break goals down into supporting goals with quantitative measuresthat are weighted and fully connected. These approaches often require theimplementation of a substantial amount of measurement in areas where no measuresmay currently exits. It is important to at least provide a connection by goal, category,strategic priority or some other language to the goals at the next higher level of theorganization. Just like measures, there are countless formats for tracking goals andhighlighting the measure, current status and other information. I preferred the basicfoundation format in figure 13. It simply covers the higher level strategic goal or priority,goal description, measure / target, champion, color rating by quarter and a currentstatus / notes column. We used far more extensive formats to track detailed supportingmeasures in finance, operations and other groups. Figure 13 – Basic Goal Tracking Template / ExampleBuilding A Performance Culture, A Guide for Leaders Page 30 of 88www.The-Culture-Advantage.com
  31. 31. There was never the intent to capture everything in the format because we hadquarterly goal reviews to discuss current status and adjustment to plans going forward ata more detailed level. These quarterly reviews were supported by monthly dashboardreviews where key next steps were discussed and major issues were taken off-line formore detailed review (the process is covered in the next step). Some goals were alsosupported by more detailed action plans. An important part of goal translation is the connection of measures to the front linesof the organization. It’s often beneficial to consolidate information and measures inhighly visible dashboards. Goals and measures provide a great framework to make sure there is a focus on thestrategic priorities of the organization. It’s sometimes difficult to take the structure allthe way to the people at the front lines of an organization that are involved in directlyproviding services, producing products or providing support for the organization in someother way. Goals and measures in some areas may need translated down to hourly ordaily tracking to keep a close tab on performance so adjustments can be made quicklydue to the regular feedback loop of measurement. In some cases, it helps to trackmultiple measures in a dashboard or consolidated format of information and measures.Again, there are countless different formats. You might have seen one at a fast fooddrive through window where they track response time or in a sales, customer service ormanufacturing environment. It’s amazing how it helps to consolidate information onone page, white board or some other format so there is focus. Figure 14 is a simpleexample from a manufacturing environment. Figure 14– Basic Dashboard Example (Manufacturing)Building A Performance Culture, A Guide for Leaders Page 31 of 88www.The-Culture-Advantage.com
  32. 32. 4.9 - Build the Foundation: Step 9 – Implement a Management System for Priorities &Goals We’re now to the last three steps of Building the Foundation. These steps supportthe prior 9 steps and further enhance clarity and alignment. They cover trackingprogress on priorities & goals, communication and motivation. They are the supportstructure for the strategic and financial alignment you are achieving with the 12 steps. The management system for priorities and goals includes the regular cadence ofreviewing current status against the plans and measures for your goals. We’ll call these“management reviews.” Larger organizations need clear management reviews atdifferent levels of the organization so each set of goals, measures and plans is beingconsistently reviewed at a defined frequency. Champions and teams for variousmeasures will ideally have recovery plans or actions in-progress for key variances toplan. The reviews should be efficient and highly focused on capturing any major coursecorrections or follow-up actions necessary to improve performance to plan, AND theyare important for expanding the management of any reasonable continuousimprovements. The management reviews help with teaching the organization how eachleader and team should apply constructive approaches for reviewing progress andproactively adjusting plans where appropriate. A negative tone in these reviews onlyspreads fear and inhibits proactive action and transparency. The reviews are also animportant time to recognize progress with both behavior and results. The generalframework of the overall process is identified in Figure 15. Figure 15 – Management System for Priorities and Goals Plans should be identified in order to support achieving a goal and the relatedmeasure. The plans may be formal or informal but resources and, in some cases,supporting tools are necessary to manage the plan. Management reviews involveBuilding A Performance Culture, A Guide for Leaders Page 32 of 88www.The-Culture-Advantage.com
  33. 33. evaluating current status against the plan and measure. Issues or problems may needproblem solved in a logical counter clockwise direction:  Was the measure correct and information captured accurately?  Were the right resources and tools in place to manage the plan?  Was the plan adequate to allow achievement of the goal and measure?  Was the goal and measure well-defined and realistic to allow definition of an achievable plan? Management teams don’t need to walk through each step for each issue but theframework may be beneficial to reduce haphazard, unstructured problem solving witheveryone throwing their idea out about the root cause of a problem. These meetingsshould involve “confronting reality” in order to make sure the key issues in theorganization are being openly discussed. Larger organizations will need a managementreview process at multiple levels (see figure 16). Figure 16 – Management Reviews by Level (for larger organizations) I held a monthly meeting we called a “business meeting” in most organizations I led.The meeting ranged from 4-6 hours for a thorough review of our major functional areasand cross-functional teams (more on teams later). I would take the notes at themeeting, capture major actions and distribute the notes to all salaried employees.There would be a sensitive issue from time to time we would track separately but theemployees really appreciated being in the loop on the vast majority of key actions wewere managing in the business. This approach would not work at the top level of a verylarge organization but it could within supporting divisions, teams or locations. The keyis for relevant updates to be communicated across the relevant audience.Building A Performance Culture, A Guide for Leaders Page 33 of 88www.The-Culture-Advantage.com
  34. 34. One important aspect of the approach was the format for departments and cross-functional groups to review progress. I used the following “Quad Chart” format acrossmany different departments and teams to efficiently report out on the progress of goalsas well as the current issues that were consuming the time of a department or cross-functional group. As you know, balancing the short-term and longer-term action is adifficult balance. A brief explanation of each “quadrant” is listed in the example below.The key to the format was the “Leadership Team Support” quadrant. The summary oftop issues and status on priorities was important but the team used the “LeadershipTeam Support” area to clearly identify when support or help was needed to complete agoal or handle another issue. It helped bring clarity to what departments and teamswere taking responsibility for and what support they specifically needed frommanagement. Figure 17 – Dashboard Example for Departments / Teams (Quad Chart) On a monthly basis, we focused on the short-term actions that supported both theoverall goals and any “top issues” that could be in support of major goals or day-to-daywork. The quad chart would be followed by other measures for some departments andteam. The review of the quad chart was a brief update and was supplemented withmore thorough review of goals on a quarterly basis (see Figure 13). Employees couldmove across departments or teams easily and utilize the approach. It was also astraightforward process we could easily explain to any employee.Building A Performance Culture, A Guide for Leaders Page 34 of 88www.The-Culture-Advantage.com
  35. 35. 4.10 - Build the Foundation: Step 10 – Implement Communication Habits & Routines John Kotter identified a key “error” as part of a list for “Transforming Organizations:Why Firms Fail” in his book Leading Change. 10 Error #4 was “Undercommunicating thevision by a factor of 10 (or 100 or 1000)” and I couldn’t agree more. I firmly believe it’snearly impossible to over-communicate, not only the vision, but what the organization isdoing to support the vision (the strategies, goals, current status and key plans).Communication is extremely important with every major aspect of building aperformance culture but I am intentionally highlighting it at this point in theexplanation. The last step was focused on implementing a management review processbut that only involves a small part of the overall organization. You need clearlyestablished communication habits and routines to engage the entire organization in theprocess to manage and refine improvements. You should have already engaged theorganization in the process to clarify vision, values, strategic priorities, goals andmeasures. The effort will be wasted if you don’t engage the organization on an ongoingbasis after building that strategic alignment. Clearly establish basic habits and routines related to communication. I held amonthly communications meeting in some form (face to face, web, cascaded approachwith multiple locations, etc.) for over 10 years. We only missed a couple months butthere was something about the monthly frequency that kept the team focused onpriorities, the progress we were making (our current status) and key next steps. In therare instances when we missed a month, I could definitely tell that the issues, questionsand lack of clarity grew exponentially in that second 30 days. Our team knew everymeeting would include discussion about the vision, review of our key strategic priorities/ goals / measures, a brief review of current status and anything significant related toupcoming plans. There was always some effort to engage in feedback, even if it wasonly Q&A, over the course of the meeting. This was also an important time forconfronting reality about issues in the business and changes to our plans, addressingdrama-inspiring rumors or concerns and, ideally, recognizing examples of great behaviorand results. The communication meetings were just one example of a communicationhabit or routine. We supplemented this monthly focus with the “involvementmeetings” (referenced in step 6) every six months, regular events (social, wellness,recognition, etc.) to build team spirit with a purpose and other habits and routinesacross departments, teams and locations. Emphasize clarity in communication. I learned this the hard way over many yearsbut fortunately a trusted employee gave me a wake-up call on this front. He said Itypically have great vision and overall plans but it takes too long for the organization tounderstand, engage and fully support them. The result is more stress on everyoneBuilding A Performance Culture, A Guide for Leaders Page 35 of 88www.The-Culture-Advantage.com
  36. 36. involved and it slows down progress. I immediately began focusing on clarity and thefollowing approaches help: simple summaries and dashboards, repetition, pre-reviewsof communications by key influencers in the organization, simple financial summaries,lots of visuals, the “power of 3’s” (no more than 3 priorities, goals, next steps, etc. sothey are memorable), feedback to confirm clarity, make it interesting and fast movingbut balanced with repetition on key points, checking for understanding, using storiesand analogies and did I mention repetition??? Informal communication was just as important as the planned communicationroutines. Countless one-on-one discussions were necessary to explain the process andplans and to VERY proactively request feedback without being defensive. These “behindthe scenes” discussions to build understanding and confidence in the approach werecritical to increase clarity initially and to identify adjustments we needed to maintainclarity along the way. I was normally coaching people about how to manage issues andideas themselves but I definitely used their input to continuously refine our work. Focus some of your informal communication on key “influencers” across the team.There are always people that seem to have a great impact on others. It could be due totheir tenure, competence, personality or other reasons. Get the influencers on boardand you have momentum, and allies, that will give you the confidence to endure manyobstacles. I liked meeting with long service employees at the start of any new role.They were always able to boil down the key issues and clarify what’s “always been thatway” versus more recent issues that may have emerged. I would typically have a fewmeetings with them as a group to help utilize their feedback in a very proactive wayuntil they gave feedback that real change was starting to occur. It also helps to workwith high potential employees that have the passion and proactive approach to spreadunderstanding. They will ideally be capable of sifting through all the hallway chatterand drama to give you “the word” on what everyone is really thinking about the changeefforts. I always tried to directly address “the word” they shared in upcomingcommunication activities by directly confronting issues or adjusting the content so theseissues could be discussed openly without revealing a specific source. Your time isprecious but understanding influence definitely helps. I like Robert Cialdini’s sixprinciples of influence from his book Influence: The Psychology of Persuasion.11 Theycan be “used” in a totally unacceptable way but they are very powerful tools if theybecome a natural part of your leadership style.Building A Performance Culture, A Guide for Leaders Page 36 of 88www.The-Culture-Advantage.com
  37. 37. Communication – Applying Cialdini’s Six Principles of Influence 1) Reciprocity – the concept of returning favors. A leader must take the time to give collectively and individually to their organization. Giving time and energy to communicate, support and guide will be repaid in countless ways if employees genuinely believe you care. 2) Commitment (and Consistency) – Cialdini says we have a deep desire to be consistent. The structure of the 12 steps in Building the Foundation provides a level of consistency to the work of individuals and how it all fits together. It’s also important to be consistent about communication on problems or issues. Employees will not be open about communicating the “real” issues if they fear your reaction. 3) Social Proof – this is related to the sense of there being “safety in numbers.” It’s one of the reasons focusing some energy on key influencers in your organization is beneficial. Others not only listen to them but they tend to act in ways that begin to fall in line with their actions. The 12 steps also helps build a framework of expectations for all employees to support. 4) Liking – we are influenced by people we like. It’s not a bad thing for your employees to “like” you and this will happen if they genuinely believe you have their best interests in mind. The concept also applies to why it’s important to have key influencers “on board” with a new direction or change. 5) Authority – we feel a sense of obligation to people in authority. You are already in this position as a leader. Don’t leverage this too much until trust is high in your organization. 6) Scarcity – we desire things or they are more attractive when they are scarce. Your time as a leader is key with this principle. Your employees know your time is limited so taking time individually and collectively to communicate, coach and support actions has a great impact. A few minutes with an individual contributor might have more impact (influence) than hours with a top manager. Take those few minutes (especially when they say “I didn’t want to bother you with this” or “you probably don’t have time for this”). There are countless issues that will be raised if there is extensive formal andinformal communication to support your improvements. Don’t forget to revert back toprioritization as a team if you feel like the number of issues is growing and your clarityand alignment is beginning to deteriorate. It’s better to take a step back and obtainmore input as part of re-prioritizing or adjusting plans than to just proceed and hopeclarity and alignment will improve with the current approach. I have one last tip for formal face to face communication meetings; there’ssomething about food that puts people in a more casual frame of mind and drawspeople to the meeting. I held most communications meetings over lunch. They werenot “mandatory” but attendance was always great if it was a less-formal discussion overlunch. 45-60 minutes once a month for 12 months is a big commitment but it can be amajor step towards building clarity, alignment and involvement across a team.Building A Performance Culture, A Guide for Leaders Page 37 of 88www.The-Culture-Advantage.com
  38. 38. 4.11 - Build the Foundation: Step 11 – Build Motivation throughout the Process This framework to build a performance culture may be coming across as more aboutstructure than behavior and that is absolutely not the case. The structure helps levelthe playing field so behavior, performance and other real issues in the organization willbe prioritized and dealt with more effectively as a team. The structure helps individualsunderstand where and how they are able to influence their work and their team. It alsohelps them understand how their efforts are connected to the overall efforts of theorganization. As we reviewed earlier, this is all about increasing the individual andcollective ability of an organization to make an impact and that’s highly motivating. Feedback and recognition are necessary for individuals and teams to understandwhere their efforts are beginning to make an impact. You need a continual and honestassessment of current status so feedback and recognition efforts don’t come across asfake or missing the big picture. There should always be some positive recognition that istaking place. Sharing progress is a huge motivator to build momentum and confidence,especially if it resulted from planned efforts to build a performance culture as a team. Provide feedback and recognize all over the place! Say thank you repeatedly withface-to-face discussions, e-mails, notes, phone calls and messages. Don’t let progress gounnoticed. Build recognition habits into your performance culture in communicationmeetings, monthly management reviews and other forums. Utilize positivecompetitions with organizational measures and recognize teams that make the mostprogress. I always liked balancing these positive competitions with broader employeerecognition. The top teams and all employees would be recognized if there wassubstantial progress. Positive energy must grow and should start from the top of the organization. Youshould be confident that a well-planned effort to engage your team in clearly prioritizingand implementing improvements will result in progress. You also need the persistenceto go back to your team when major things don’t go as planned to re-evaluate, prioritizeadjustments to your plan and move forward without reverting back to a top-down stylethat will undermine your efforts. There is nothing worse than building hope in yourorganization around an improvement effort that will be managed as a team and thenreverting to top-down decisions when things get tough. I am not saying there is noplace for decisions from the top. It’s only an issue when you have built expectationsabout a different process being used to manage a priority and then you come across aschanging course mid-stream with poor communication. We started this section on motivation with an emphasis on feedback andrecognition. This is a move toward positive and higher-level motivators that help tobuild momentum. You will not be able to ignore major compensation, benefit or otherBuilding A Performance Culture, A Guide for Leaders Page 38 of 88www.The-Culture-Advantage.com
  39. 39. issues with lower level motivators. You need to clarify how major issues will beaddressed or at least be influenced in the future as you deliver sustainable performanceimprovement as a team. There are always limits; over-promising will kill you later buttotally ignoring these fundamental issues will undermine efforts to focus on the higherlevel motivators like recognition, performance-based rewards, pride and “impact.” It doesn’t matter if it’s work to support higher or lower level motivators, at thefoundation it will be necessary to grow or reinforce a feeling in your organization thatyou listen and care deeply about each person. Don’t feel the need to always offersolutions since you are a leader; listening and asking a few questions will often lead theother person to the solution. If it doesn’t then you will at least have shown you caredand hopefully you went beyond just listening to truly understand. If they know you arecompetent and care, they will run through walls to support you and allow you to learnand improve as they learn and improve. Start with this fundamental point of listeningand showing you care, through action and not just words, so you build trust at the baseof your performance culture and get at the “real” issues. Listening QuotesTo listen well is as powerful a means of communication and influence as to talk well. John MarshallListening is noting what, when and how something is being said. Listening is distinguishingwhat is not being said from what is silence. Listening is not acting like youre in a hurry, even ifyou are. Listening is eye contact, a hand placed gently upon an arm. Sometimes, listening istaking careful notes in the persons own words. Listening involves suspension of judgment. It isneither analyzing nor racking your brain for labels, diagnoses, or remedies before the person isdone relating her symptoms. Listening, like labor assisting, creates a safe space wherewhatever needs to happen or be said can come Allison Para BastienThere is a huge difference between the opportunity to have your say and the opportunity to beheard. Jim Collins, Good to Great4.12 - Build the Foundation: Step 12 - Performance Management Now is not the time to implement a new and very structured performancemanagement system as you Build the Foundation. I’ll touch on some aspects of a morethorough system in Phase Two – Expanding the Approach. The bottom-line for whatgives energy and momentum to effectively manage all of these goals with the rightBuilding A Performance Culture, A Guide for Leaders Page 39 of 88www.The-Culture-Advantage.com
  40. 40. behavior is peer feedback and accountability but there still needs to be a rigorous focuson key measures. When it comes to feedback, some of course comes from bosses but peers arecritical. Teams and employees commit to the behaviors and goals through the processto establish and communicate them. They are given every opportunity to have input toareas where adjustments are needed but it’s often through collective efforts toprioritize improvements. There is a shared sense of accountability that’s built asprogress is made and employees gain confidence in the approach. They becomeemotionally connected with the changes but in a more organized way. Management recognition and feedback are important to help reinforce the rightresults AND behaviors; both are critical for culture change. The management feedbackneeds to transition into an increase in peer feedback to support each other but also tocall out performance issues (behavior or results) in the proper way. They learn, ideally,the proper way from how their leadership manages performance and the top leader isthe model. If they see the top leader “going negative” and not being factual andconstructive about behavior and results issues, it will drive fear and they will have atendency to “go negative” or avoid confrontations altogether. Don’t EVER “take thebait” and “go negative” but constructively stick to the facts and actions to move thingsin a positive direction even if you are being confronted in a totally unreasonable anddisrespectful way. It’s definitely not about ignoring big issues but hold back fromfeeding the drama fire. Leaders need to be comfortable visibly giving performance feedback even in verytough situations where some might think it would be best to take the discussion off-line.If an employee exhibits a serious behavior issue visibly to a group, in a meeting or someother forum, the leader must visibly call the issue out in a direct but respectful way andprovide constructive feedback. The employee can’t have the visible explosion or othervery negative behavior without there being visible confrontation and constructivefeedback. Everyone in the room learns from the exchange even though they may feelincredibly uncomfortable. These difficult conversations make all the difference inreinforcing the expected behaviors. You and your leadership will never have credibilityif employees feel the rules apply in a different way at the top. It’s still important for theleader to have one-on-one discussion with the employee after a confrontation. Therewill likely be deeper issues that need understood but it also provides an opportunity toreconfirm expectations again. If visible behavior issues persist, even with constructivefeedback every time, then a more significant discussion and change is likely needed. Ihad one of those situations. There were a number of explosions from a senior manager.I tried to address them in a constructive way and understand his deeper feelings. OneBuilding A Performance Culture, A Guide for Leaders Page 40 of 88www.The-Culture-Advantage.com
  41. 41. day he called me and exploded: “you’re from the new school that’s all about hugs andkisses and I am from the old school that’s about performance and giving people a swiftkick in the ass when they need it!” I still remember the exact words years later. I’ll givehim credit; he had an interesting way of getting his point across but he was also makingit clear a change was needed. We just had totally different views about leadership andit wasn’t personal. Fortunately, it’s been my experience that the positive recognition and feedback faroutweighs the periodic corrective discussions that are necessary. Positive recognitionand feedback starts to explode in some organizations and further helps motivateemployees to give their extra effort. Employees learn how to effectively confront theirpeers, especially if they see it modeled in a constructive way from leadership.Employees that are being destructive stand out. This is not about avoiding issues it’s allabout addressing them quickly and constructively as a team. Employees will still bring a leader issues about their peers. It’s important for theleader to coach the employee on how to handle the situation and not to take themonkey on their back to deal with the issue. There are times with major issues whensome direct intervention is needed but the vast majority of times it should only be afterthe employee has tried to handle the situation themselves in multiple ways. The entire design of this process is grounded in feedback and prioritization. Ideally,employees see leaders reaching out consistently for feedback but they start recognizingthe importance of the prioritization step. There shouldn’t be any more long feedbacklists with everyone interpreting in their own way whether appropriate action is takingplace. Diligent application of the prioritization step leads people to start to appreciatethe power of feedback in reducing stress and improving their performance. They startreaching out for feedback but also try to focus it toward priorities or next steps so theysee value from the effort instead of feeling even more overwhelmed. I’ll end this section on performance with an emphasis on goals and measures. Thestart and end of any discussion about how the organization is performing needs to beconnected back to measurable and visible progress. All the great momentum built fromfeedback, recognition and managing improvement as a team will fall apart if there is nomeasurable progress. It can’t be left up to individual opinion whether progress is beingmade and the key measures you have highlighted for improvement must improve overtime. If the organization is not “performing” and delivering the necessary results, it’simportant to re-engage leadership and the team to adjust priorities and plans as a team.There needs to be clarity around the performance gap: why it exists, what caused it andhow priorities or plans are being adjusted to close the gap. The organization needseven more emphasis on clarity when performance issues exist so leaders don’t justBuilding A Performance Culture, A Guide for Leaders Page 41 of 88www.The-Culture-Advantage.com

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