Are your “traffic light” and “P&L exceptions” reports failing to get to the nub of the issues, thus causing your managers to react, as opposed to leading well informed improvement activity?
Are you faced with keeping track of 62 “Key” KPIs? Do you have a whizzy “corporate dashboard” but never quite have the information you really need? Have you been surprised by the unintended and damaging consequences of a drive to improve a particular metric? Do you have an uneasy feeling that your managers are busy chasing targets but sadly missing the point?
How strategic is your Performance Management Strategy?
The framework of performance management in many organisations tends to “have happened” rather than being planned and managed; lots of measures get added, and very few get taken away. Over time measures can come out of alignment with the strategic business objectives. The purpose of the framework itself is often not clear; is it there to inform decision making and improvement, or to provide a means of judgement? Can it really do both? Many organisations labour under a regime dominated by lagging measures, and get drawn into a cycle of reacting which is increasingly difficult to break out of.
Understanding variation is vital
The way performance is displayed is often unhelpful: single data points don’t tell us very much at all; comparisons to last month, this month, last year, budget or target don’t really improve things. Performance is continuous and should be considered over time. Every data set produced by operations will vary over time; some variation is noise, or “natural variation,” some however will be attributable to a “signal” which might well be as a result of a genuine shift or change in performance. If as managers we respond to noise, our action will not be well informed; it may well make matters worse. Unless the way performance is presented differentiates between noise and signals, and managers who interpret it have a basic understanding of variation, we are likely to do the wrong things with the best of intentions.
Discover a high performance approach
The good news is we can help. We are currently offering to new and existing clients a “discovery” review of their performance management framework at very favourable rates. Why don’t you get in touch and find out a little more?
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