8th March 2013
Why is effective Performance Management Critical to Business Success?
Lord Sugar; in response to Stella English’s claims that she was an ‘overpaid lackey’ and was ‘constructively dismissed’ by Lord Sugar having been ‘hired’ at the end of the 6th series of The Apprentice has stated; “I begin to think that perhaps the reality of work, rather than the glamour of show-business was beginning to bite with her”.
The inference being; she was not performing in the roles that she had been given within two of Lord Sugars’ businesses. This is a view held by a number of commentators who believe that for someone to be paid a six-figure salary they should have been capable of seeking out the work, rather than sitting around waiting for the work to be brought to them.
So whilst we wait for the outcome of this case and the full details to emerge; let’s look at the importance of Performance Management in running your business and achieving success...
I am reminded of a conversation with a former manager a lifetime ago where, having got past the ‘go-live’ stage of a major IT project I had been totally focussed on, I was left with the residual minor tasks involved with wrapping up the project. At the start of my ‘in-year’ review, my manager; who had only recently assumed line-management responsibility for me and my team, shifted nervously in his seat and struggled to make eye contact with me as he prepared to share with me his observations of my work and to tell me that he believed I was really working at a level below my actual grade. He was clearly extremely nervous of my reaction to this conversation, so the relief he experienced when I told him that I was in full agreement with him and that it was time for me to move on, was immense.
Of course, not everyone will react in that way and Performance Management is often placed on the ‘too hard to do pile’; very few people enjoy having those difficult conversations with staff where you have to tell them that they are failing to meet the standards expected of them within the role that they are doing; particularly if they themselves believe they are doing an excellent job!
As a consequence, what often happens is that managers will take the easy way out and just give a fairly innocuous average assessment rather than to address the issue at hand. The problem with that approach is that, when push comes to shove and the individuals’ performance issues are having a detrimental effect on the overall performance of the business, there is no evidence to show that this has ever been raised; and so you are faced with a choice of commencing potentially lengthy capability proceedings against the individual or seeking other alternatives such as an agreed exit from the organisation...
So what then is the answer? It’s about developing a performance culture throughout the organisation; having performance management at the heart of the business, which in turn will get results and will help employees to: -
achieve their full potential
getting the best from them
fully understand their role within the Organisation
share the Organisations goals and vision and;
understand how they contribute to the achievement of those goals and vision
Managing performance is a key component in the relationship between managers and employees. It is a crucial element of communication and can foster trust between the individuals as well as identifying key areas for development. If you manage performance well; some correlation will be seen between an individual’s engagement with the Organisation and how well they can perform in their role. An individual who is engaged with their Organisation is more likely to be performing at their best and will: -
take pride in their work
show loyalty to their team, manager and the Organisation
be flexible and adaptable; willing to ‘go that extra mile’.
And more importantly, they will contribute to the overall success of the business...