Measuring Organisational Performance!

By Jim Thomas, PDW Group (UK)Limited

Does your firm have the right organisational measures in place to improve performance and drive better results?

Measuring the performance of what your employees are doing and how they are contributing, as well how your firm is performing, is critical to enable you to enhance what is working, or improve what is not.

There are a number of components that will affect performance in a business setting but put simplistically, there are two contributing variables.  If you combine them properly and invest appropriately, the results are substantial.  We believe 1+1=3: 

Variable 1: people and their behaviour.

Variable 2: the supporting systems, processes and tools we use. 

Many SMEs and professional practices do not measure their organisational performances in a very sophisticated way.  Sure, knowing your top line results, so total revenue and total cost is one thing, but digging deeper and having clarity at any one time on what is actually driving those things up or down is entirely another.

When it comes to properly measuring the performance of individuals, even more businesses struggle to do this effectively, with some very significant impacts.

So the vast weight of compelling evidence we have is that PERFORMANCE MEASUREMENT is the key in understanding performance in the first place.  This then gives the right insight to allow changes to be made, that improve specific aspects of performance. 

For instance, as a professional services practice, you are aware that your business revenue performance is tracking below the target you had set.  Why is this?  Is it because you are not cross selling new business services sufficiently in current clients, or because you are not winning enough new prospects?

Let’s say you identify it is the new prospect wins/revenue that are the performance issue.  Digging deeper, how many new leads is the firm generating? How effective are you at converting the leads you do have into paying clients?  And what about the average spend for new prospects, how is that doing?

So you see, a below target result for new business revenue could be a performance issue in one or more of three key areas: 

  • the lead generation performance to create a pool of prospects.
  • that you have a large pool of prospects, but it’s the conversion effectiveness in terms of getting these prospects over the line that’s the issue.
  • Or, that people are just not confident enough to agree higher fee levels or broaden the services provided that is dragging the financial return from new wins downwards.

Without understanding the performance drivers, you may rush off and make the wrong choices….for example ploughing on and putting loads of people into networking environments to generate more leads, where it may just be that it is the conversion rate or prospects that is the issue.  If it is, this is almost guaranteed to be a lack of behavioural capability.

Measuring the performance of key components of what individuals are doing and contributing, as well as where the firm is performing or not, is critical to enable you to keep doing what’s working, or change and improve what is not.

When it comes to individual performances, we use a simple phrase in our work.  Behaviour drives performance which delivers results.  As we alluded to earlier, systems, tools and processes play a part in supporting the behaviour of the person, but all our experience tells us that behaviours (and skills) are the major contributor to great performances and results in the workplace.

And what drives behaviour?  Well many things drive it…DNA for a start, but there is also a huge slice of workplace behaviour (and therefore people performance) which is down to people’s mindset and attitude and how they ‘feel’ about their work and their environment.

How people feel, and how engaged and motivated they are is critical.  These things can all be significantly affected by what goes on in the firm, and in particular the quality of the behaviour of partners, senior leaders and people managers around them.

These are the people that have the most day to day influence, and can quite simply enable, or disable the people around them.  This is where much of our work takes us at PDW Group.  We help firms define, measure and transform the behaviours of their people to improve performance, to drive better results.

Through IAPA I hope to raise awareness to member firms about the importance of raising professional standards to improve the ‘quality and efficiency’ of what they do, both of which are key performance indicators in their own right.

Much of achieving this is about having the right people in the right roles, with the right direction, capabilities, resources and motivation….and these things generally don’t happen accidentally…they need to be purposefully brought about.

Jim Thomas PDW Group

www.pdwgroup.co.uk

© PDW Group (UK) Ltd