In order to create an effective performance management system, it’s important to first understand how to create an effective team with individuals who perform at their best and contribute to team behaviors. Let’s review the winning team model and then get into describing the performance management system that will support maximizing results for that team.
The Winning Team Model
The graphic attached shares the Win Enterprises Winning Team Model. You’ll notice the light blue circles represent actions that optimize individual performance and the dark blue circles represent actions that optimize team performance. We love using the team metaphor, as in sports teams, and how sports teams behave in their whole process in order to win the game that they’re playing. The same is true in a business. You have individual players, and then you have them come together to play as a team.
It begins with recruiting players. Think about your recruiting decisions; how you recruit, how you hire individuals, interview them, and communicate with them during the hiring process. Then, how well you bring them on board, onto your team, once they’ve started working for you. All these interactions should align with who you are as a company and set up new players for success.
It’s critical that your players fit into the positions that they’re required to play. So think about your organizational structure and who reports to whom. Do you have a top-down organizational structure? Do you have a matrix organization? Do you have a team-based organization? All of these are useful in various situations. The important thing is for you to define what your organizational structure looks like, and let your players know who reports to whom.
Also, it’s important to define the roles and responsibilities for each person. If you think about an analogy where a football team is playing defense, who’s covering what areas/lanes/zones? Who’s responsible for what? If the ball moves in one direction, what do the different players do? That’s really the same as roles and responsibilities in an organization. This will set up the individual to be successful on the team that they are part of.
Now let’s talk about the team. A team is a collection of individuals that work together toward a common goal. The team members all have different functions in order for the team to be successful.
Practice is about getting the fundamentals right. Practice might include team building activities, skills training, and personal development. Naturally, individuals need to practice, but they’re doing it within the context of the team. They need to clearly understand their position and the role they play on the team. Any team building, skills development, and personal development exercises help the team perform better as individuals practice the role they play for the team.
Review Game Plan
Reviewing the game plan is the idea that there is a strategy that the company has, and how we’re going to play the game right now is important. It begins with understanding today’s priorities so that each individual on the team can contribute to achieving whatever today’s goals are. There are also projects that take place over a longer duration than just one day. Reviewing the game plan would be going over the project charters for these project teams so it’s clear what activities the players need to take on towards a longer term goal.
Play the Game
The next element of the Winning Team model is to Play the Game. This is the execution part of the job. Play the game is where you execute your day to day activities and execute them well. It’s also where the team members work together to achieve the project goals, and individuals interact and make valuable contributions.
Keep Score is the process of evaluating the team performance and making adjustments where required. What you’ll find as you keep score is you’ll get feedback about how the team is doing, and you’ll notice where you require more practice (more training, team building, or personal development). The score may indicate where there is an additional player that you need to recruit. Either to replace one who isn’t making it, or because the team’s responsibility and workload is growing in scope and because you have the budget to add new players. When you keep score, you receive feedback about the skill sets of the players that you want to recruit.
This Winning Team model works to represent how teams within a company can become high performing and perform their responsibilities well in order to achieve the company’s’ goals. The model works for one small team as well as it does for multiple, large teams.
Managing Performance within Your Company
When you think about managing performance in your company, there are different levels within your company within which to manage and different frequencies of performance management touch points. By levels we mean starting at the company level, then considering the team level, and finally the individual level. By managing the durations you create processes to do each annually, quarterly, monthly, weekly and daily. Let’s talk about each and you’ll notice how at the company level, the conversations are less frequent then they are at the team level and most frequent at the individual level. That said, there are touch points at all levels here.
Company Level Performance
The process we suggest for managing performance at the company level is what we call Strategic Goal Deployment™ (SGD™). SGD™ is the method by which the company takes its strategic goals for the long term, figures out what it should achieve this year, and gives great definition to the actions and results that it expects to achieve on a month to month basis through the year. Each year there is an annual exercise to convert the strategy to the annual goals and to then define the priority initiatives, the metrics, and targets that will track the initiatives. You will create action plans behind every metric on how those targets will be achieved at the monthly milestones, and will define who is accountable for achieving those targets.
On a quarterly and monthly rhythm, you hold progress review meetings that begin with the review of the company’s financial performance, and then get in to the operational performance according to the targets set within SGD™. Within these progress reviews, the conversation also dives deeply into the team progress and action plans to see how the different metrics are being achieved and how the progress is against the action plans that were defined that will ultimately deliver those results.
Managing Team Performance
Once the company level SGD™ is defined, the targets and initiatives are cascaded to the different departments and teams within the business. Each of the teams you form will then have charters for their different projects. Where goals, metrics and targets for their monthly milestones and specific action plans for how they will achieve their goals and targets are all spelled out. A progress review is scheduled periodically (i.e. 1-2 per month) so you can help the team keep score.
For the longer term projects, there will likely be a monthly progress review that is part of SGD™. Strategic Goal Deployment ™ progress reviews are normally high level reviews to say that something is on track or off track, and when off track to give a sense of what the team is doing to get back on track and hit the results as planned. In addition, there are deeper discussion progress reviews specific to the different project teams where the team leader and team members report their detailed progress, share their challenges, engage the management team in problem solving and facilitate decision making to make sure that these predicted results happen as planned.
Within these team projects there are usually kaizen events to help execute and “play the game”. Kaizen events are usually a week long duration, so there will be an end of week report of the kaizen teams’ progress and results, and also a report out 30 days later to confirm that the results from the kaizen team were actually sustained during the kaizen’s implementation. At a daily rhythm, there’s an end of day update that gives a quick sense of how the team is performing each day and includes today’s accomplishments, tomorrow’s plan, help they need, and important items you need to know. These report outs keep the team on track and keep the management team apprised of progress and challenges so that they can be engaged in helping to ensure the kaizen team is successful.
Managing Individual Performance
The way that individual performance is tracked and managed is similar to the process a company follows with annual goals and then cascading them into shorter duration milestones and targets. But there are certainly some differences. The process that we like to use to describe this is the Daily Action Log methodology.
The Daily Action Log methodology beings with the individuals’ annual goals, where naturally those annual goals for an individual within a company setting will reflect their roles and responsibilities, their team expectations, and the department metrics within the company’s SGD. The method for figuring out your annual goals is certainly personalized by each individual, but should reflect their team and company goals.
Once you have your annual goals defined, the task is to now define the quarterly goals that will support the annual goals. There are forms within the Daily Action Log process to help you define your quarterly goals from your annual goals. The book Act Now! A Daily Action Log for Achieving Your Goals in 90 Days fits perfectly with this process of taking your quarterly goals and making them a reality. Now that your quarterly goals are defined, it’s time to create some action plans for each one of your goals so you can determine what steps you will take that will make your quarterly goals a reality.
Once you have your action plans defined, there’s a whole daily process of figuring out what actions will have the most impact for you each day. There are planned action steps you can take, daily habits that we encourage you to follow, and then inspired actions that will not be planned previously but will come to you in moments of inspiration when that “light bulb” turns on and you get that million dollar idea. All three types of action are important to take on a daily basis.
The Daily Action Log format helps you to define the priority actions and helps you track to keep you moving forward so that your 90 day goals will become a reality. When you follow this format there is a daily exercise of checking the boxes on the form as you go and take the different actions through the day. The weekly exercise is to tally up the number of points you achieve each week as you’re taking the actions toward your quarterly goals.
Managing individual performance this way largely rests on the shoulders of each individual, however there are ways to make this exercise to make this team-based within your company. For example, you can have each individual share what they’re planning to do today within the context of the larger team. Each team member shares not only their plans for today, but also the number of tasks they completed the day before and reviews each week the number of points they achieved. This is an effective way for team leaders, supervisors, or managers to engage their team members so that they know they are working on the most important priorities and can help them adjust their plans each week or each day as they go through and accomplish their tasks.
As you can see, managing performance at the company, team, and individual level are all parts of your larger performance management system. It’s important to have annual, quarterly, monthly, weekly, and daily touch points within your system. When your efforts to manage performance follow to the Winning Team Model you have a better chance at being effective with your teams and individual players, and with the goals that you seek to achieve.
Tying in your Performance Appraisal System
As you can see, managing performance is so much more than a performance appraisal exercise, managed by Human Resources. That said, formal performance appraisals are still important.
The good news is with everything we’ve described here, they all fit nicely as an input to the performance appraisal process. For example, an individual should have their individual goals line up with team goals and company priorities within SGD™. Compensation bonuses can also align with those same individual goals, team goals and SGD™ goals. In fact, when alignment is at its highest, individuals will be paid the highest commensurate with their efforts that do indeed deliver the company strategic goals.
Because the system we outlined here has daily, weekly, monthly, quarterly and annual touch points, it’s easy to give feedback to your team members along the way as opposed to waiting for an annual exercise to write up a performance appraisal. In fact, the annual performance appraisal write up, if you follow everything we’ve described here, is simply a formality because there should be no surprises with what is written in that annual review.
I hope you’re able to see that while managing performance across your business has many elements, with a structured system like what we’ve outlined for you, you can maximize your effectiveness as a leader. Goals are clear. Roles and responsibilities are clear. You have mechanisms for reviewing results and providing feedback. You win the game you’re playing as a company, which enables all your employees to win, too.