Every one of us is a high performer capable of supporting others around us to perform at a higher level.
As a common practice, companies generally provide coaches with assessments and development plans to coach corporate executive leaders. Usually, these are a combination of psychometric tests and 360 feedback along with developmental plans based on them.
These assessments are based on leadership competency metrics that the company has developed. HR chooses from a library of competencies offered by the test provider, choosing the most suitable for the leaders in the positions they are in. Leaders are then self and 360 assessed on a rating scale. In a 360-feedback, the scores of the leader and the line manager would usually be visible to the leader. On a 5-point scale, below 3 is unacceptable performance, anything less than 4 is seen as a developmental need, and a score above 4.5 as a strength area. Though this may differ a bit, 80% of the assessments work on this logic.
A leader working in a commercial space may be rated on financial acumen, negotiation, etc., an HR leader, on people skills engagement; and an operations leader in a technology company, on technical skills and innovation. In addition, general competencies in communication, collaboration, strategic thinking, etc. may also be assessed as qualitative performance factors. Quantitative performance factors do not need sophisticated tools and are directly measurable.
Every so often a leader would ask me, ‘’I am rated at 3.8. My colleague tells me that their rating was 4.4, and that person is not as good a performer. What can I do to raise mine to 4.7?’’
My first response would be “Why don’t you check with your manager what performance metrics they used to rate all of you? We can then explore what would be best for you.”
The leader would come back and say, “My manager has no metrics. He evaluated on his judgment.”
I then suggest, “Can you ask your HR whether the company has metrics to define the performance and therefore measure?”.
The answer is predictable.
Very few companies in my experience have metrics for qualitative performance.
The Coach then asks the Head of HR whether the company has documented statements of vision and cultural values from its mission, strategy, roles and responsibilities, leadership competencies, and performance contracts with metrics. Some conversations go like this:-
HR: Well, we have a very detailed culture statement based on surveys with a large number of employees.
Coach: Can you summarize this document as 5 key cultural values?
HR: (Struggles to and cannot get past 2) I can give you the document.
Coach: Thanks, when was it created?
HR: 10 years ago.
Coach: Has it been updated?
HR: (With a grimace) No. I have been here only 3 years.
Coach: You have leadership competencies, don’t you?
HR: Yes, of course, 20 of them. I had sent them to you.
Coach: How are the leadership competencies aligned with your documented cultural values?
HR: What do you mean? One is about culture, the other is about performance.
This seemingly unreal tragic-comic conversation has happened to me a few times. In one case, I withdrew from the coaching assignment till the company was able to explain its rationale for qualitative performance evaluation. Very few companies have a structured, ‘performance evaluation and feedback systems’ in which performance-outcome factors, and measurement metrics, link back to their mission, and in turn to vision and cultural values.
One may ask, as the HR Head did, “Why should they? Why should performance align with culture?” If you’re one such, it would be best to stop reading this article. You may be better served reading management fundamentals, starting with Peter Drucker’s statement “culture eats strategy for breakfast every time.”
Simply put, the collective behavior of people in a company would define its performance. Many studies have shown that the more inspiring and engaging such a culture is, the higher the performance. Slave driving and bullying have no place in organizations today.
This may change in the future when companies are fully robotized when the new mantra may be ‘operating system eats everything else for breakfast, lunch, and dinner.’ Today, culture is the operating system.
A great leader, I once worked, for had a five-point culture statement for his group. When I joined his group, he told me “Ram, I want you to burn these 5 cultural values in your memory. You should be able to articulate these if I wake you up in the middle of the night.” Every single decision that the employees of this group took flowed from these values, almost. Each company within that large group co-created a vision for its future with these underlying cultural values. I do see a few companies that have these.
Vision, usually a short one or two-sentence statement of purpose, is generally inspiring and emotional, a mix of quantitative and qualitative performance factors. This vision helped develop the mission statement, a brief summary of what the company should focus on as activities with quantitative performance outcome factors to realize its vision in line with its cultural values. The company leadership develops a set of leadership competencies, usually 5 to 7, in alignment with the vision and mission.
Each company has several businesses and functions with defined roles and responsibilities with quantitative performance targets. Based on company mission, each business and function define their strategies, in alignment with the company mission and the group cultural values. The businesses and functions form teams of people, whose roles and responsibilities, with performance outcome factors and measurement metrics, define what individuals needed to do, to be in line with expectations, personally and as teams.
Once such a structure is in place, all that needs to be done is for leaders to engage with the individuals in their teams to co-create a contract of expected performance outcomes with measurement metrics for defined periods of time, and provide developmental feedback. This is the people engagement process that many companies wish to follow.
To engage and ensure high performance, companies need these 7 steps:
- Cultural values established by founders, which are overarching, in alignment with environmental, social, and human governance factors, as the way the organization must conduct itself. Quite often these are aided by climate surveys with stakeholders using a systemic approach. Cultural values define the collective behaviour the organization wants and needs.
- Co-created Vision of the founders with their leaders as a purpose statement, which may be for the organization as a whole, and also for its constituent elements, in line with their business needs. Vision defines where the organization wishes to go and why.
- The mission statement of activities that the organization needs to engage in to ensure its high performance is in line with cultural values and vision. Mission defines the crucial steps the organization needs to take to perform to its vision.
- Leadership competencies are needed to achieve the mission in line with vision and culture.
- Strategies for each business and function outline the pathway in the journey to reach the defined mission in alignment with vision and culture.
- Performance factors such as goals, KPI, OKR, etc., define what needs to happen as the outcome in order to meet the strategies, mission, and vision.
- Performance measurement metrics, especially for qualitative goals, would measure the performance of individuals and teams, in an engaged co-creative and collaborative process aligning people with tasks.
Companies often believe that using buzzwords like PKR, KPI, and MBO would help them reach the mission vision nirvana. But they don’t, unless the entire weft and warp of these 7 factors are built into the fabric of the organizational system.
Some companies have well-defined leadership competencies. What lies above these competencies and below? How can measuring the competencies alone through surveys help if the entire structure of culture, vision, mission, strategies, competencies, performance goals, and performance measurement metrics are in place?
This process seems simple. Yet, 80% of companies I have worked with do not even understand the need for such a system and process.
They need to wake up.