Leaps and Bounds

When Managers Understand How Their Work Contributes to Company Strategy, They Can Ensure Their Efforts and Accomplishments Are Recognized; Performance Metrics Are the Best Place to Start

by Virginia Fairweather

If you don't know how you matter to your company's overall business, you can't expect your boss to see your value either. Like any professional, project managers want to know that their work counts and how they can stretch their capabilities to make a bigger impact, says Debra Horsfield, national solution leader in organizational measurement at Watson Wyatt, a global human capital and management consulting firm in Toronto, Ontario, Canada.

While companies must measure their employees' performance, project managers must be equally invested in improvement. Ms. Horsfield uses the term “line of sight” to describe how managers should be able to see how their contributions fit into the overall strategy of their employers. Successful firms use performance metrics to assess and nurture employees and, ultimately, to enhance the bottom line.

Managers who want to get ahead first must understand the performance metrics by which they are being assessed and strive to understand the goals that will help them and their organizations succeed. Aspiring careerists need heightened self-awareness of their own goals, skills and shortcomings as well as an understanding of the overarching goals of their employers.

THE MEANING OF METRICS

In simple language, performance metrics are used at work, home and within groups to assess and evaluate individuals and companies, says Daniel Cable, Ph.D., professor of organizational strategy/behavior at the Kenan-Flagler Business School, University of North Carolina, Chapel Hill, N.C., USA. “Metrics provide evidence that your intended or strategic objectives are working,” he says.

To increase effectiveness and success, Dr. Cable says, it's important to understand the intent of the metrics. For example, why are certain things being measured? What is the leader's intent? What does that person hope to gain from the information? Employees also should understand, if possible, the weight placed on various metrics. Ms. Horsfield agrees that the entire process should have shared ownership; managers and their managers on up the line should find the appropriate goals together.

There should be no surprises about what an employer wants to see, yet many employees don't understand how personal metrics relate to the job—they don't see how they add value to a company, nor do they see how value is measured. Those who want to move up the ladder need to “roll-down” the corporate metrics and see where those overlap with their own personal metrics, says consultant Anne Saunier, New York, N.Y., USA. The connection needs to be discussed with management and understood by all.

Companies must measure both employees' contributions to the bottom line and how they achieve their objectives. The “how” part relates to developing the less-quantifiable skills. Managers must see what they achieved and the gaps in their performance. Ms. Horsfield offers an example of an “observable” metric that combines the bottom line and associated softer skills: A software company gives managers information on sales quotas, but the reward comes only if the team member returns to the client to assure that the customer got exactly what he wanted. The metric was constructed to assure a continuing relationship with the client, she says.

THE GLOBAL VIEW

Performance measurements essentially evaluate an employee's ability to be effective, according to Laurence Karsh, president, SHL Americas, Chicago, Ill., USA. The real key to performance metrics, he says, is to implement tools that “peg individual and team performance to corporate goals and ensure that company executives can measure their employee's potential.” Companies with a competitive edge evaluate performance metrics on all levels, “from the production line to succession planning to move the right people into the right roles.”

Mr. Karsh cautions against metrics that focus on results because these measure only what already has been done. His firm, which is headquartered in Surrey, U.K., and operates in 40 countries and in 30 languages, looks at an employee's potential through cognitive ability assessments and measures that are meant to reveal preferred work style, attitudes and motivations.

There should be no surprises about what an employer wants to see, yet many employees don't understand how personal metrics relate to the job—they don't see how they add value to a company, nor do they see how value is measured.

The latter includes assessments “recognized globally,” according to Charles Moore from the Singapore office of Heidrick & Struggles, another global management consultancy. He cites the Myers Briggs Type Indicator (MBTI), and Saville & Holdsworth's (now SHL) Occupational Personality Questionnaire.

Performance metrics do change based on the part of the world where you live, usually predicated by those qualities that the home country values. For example, U.K. organizations tend to place more emphasis on development as a key driver of performance, says Mike Tims, commercial director-consultancy in SHL's U.K.office. These businesses look at behavior along with results to define how employees can improve performance. In the United States and Australia, he sees a “hero” culture in business. “Results are paramount, and individuals are celebrated for current contributions,” he says. In Europe, Mr. Tims thinks organizations take a “holistic approach, seeking clear alignment of the company's strategic objectives, business objectives and individual performance metrics.”

Nancy Ahlrichs, head of EOC Strategies, Carmel, Ind., USA, agrees with the need for the holistic approach. “Individuals get hired for hard skills and fired for lack of people skills,” she says, stressing that companies make a mistake when they use performance assessment tools that focus only on technical skills. In fact, she says, the higher up the corporate ladder, the more important people skills become.

Leadership capabilities such as multitasking, stress management and taking the initiative, can be much more important to one's career progression and the company's growth.

The skills dichotomy begins with job descriptions that define “average performance” and typically focusing on technical proficiency, Ms. Ahlrichs says. Leadership capabilities, such as multitasking, stress management and taking the initiative, can be much more important to one's career progression and the company's growth.

Ms. Ahlrichs says the best approach to creating one's personal metrics is a direct one. Aspiring managers should talk to the boss and ask “what do you value, and how do you know I'm doing my job?” Project managers can figure out why others get promoted by asking their colleagues who have advanced what behaviors and skills “proved valuable” in their success.

ALIGNING THE METRICS

To develop a focused advancement plan, an individual must have a personal plan and understand the strategic direction of the firm, according to Robert L. Cardy, Ph.D., professor in the management department of the W.P. Carey School of Business, Arizona State University, Tempe, Ariz., USA. Next, he or she must analyze where these overlap, and then make a new action plan if needed.

Dr. Cardy agrees with Ms. Ahlrichs that there are two parts to getting ahead:

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These two components lend themselves to a quantifiable metric. The other part is “things one can improve, such as being a team player and communicating with others,” he says.

Dr. Cardy advises looking at the “lay of the land.” If being a team player is important in your firm's culture, “don't hog the spotlight.” Make it clear that you share any recognition you have received. Don't fall prey to the routine complaint syndrome. Instead, offer solutions to the problems you perceive. By doing so, you “differentiate yourself from the pack,” he says. To succeed, employees should understand the corporate culture, where the firm is going, and what skills are needed to contribute to that goal. They should ask themselves, “Can I enhance myself to get where they want to go?” They should look at the core values of the company and their own values. If they don't mesh, he advises you to leave the firm.

Executives should ask themselves this key question: “Are our people aligned with their talent?”

MANAGING TALENT WITH METRICS

Performance metrics “clarify expectations and communication,” according to Yves Lermusiaux, president and founder of Taleo Research, San Francisco, Calif., USA, the talent management arm of the Taleo Corp. First, the metrics must be actionable—if employees accept a company metric but have no control over the outcome, that metric cannot not be effective.

Next, Mr. Lermusiaux says managers must ask, “Does the employee want to grow?” Getting promoted may depend on fulfilling a metric, but if the new job is totally different, it still might not fit. He points out that some people prefer to be excellent at their particular skill and don't want to be promoted out of that expertise. Executives should ask themselves this key question: “Are our people aligned with their talent?”

Employees must understand how to use the metrics if they want to be recognized and promoted. With good methods and the technology to track them, the raw data and information from reporting can be analyzed further to benefit the company and the employees, Mr. Lermusiaux says. For example, assessing individuals applying for a job in terms of being an extrovert or an introvert is not sufficient, he says. As an example of a quantifiable metric for a human resources professional, if a firm's income depends on billable hours, and the department metric addresses getting hires on board and billing quickly, the boss will notice.

Dr. Cable sums it up: He says top executives also need to think about their performance metrics. Clarity is essential; executives must be upfront about what is needed from a job, what success looks like on a job, and how a job's performance metrics fit into the larger organizational picture. Mutual understanding of these factors can provide powerful incentives throughout a company. PM

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

LEADERSHIP / 2006 / WWW.PMI.ORG
LEADERSHIP / 2006

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