Want to Improve Performance? Measure It!

Leadership & Management

Bill Price

August 19, 2008

How many times have you seen businesses fall short on delivering and sustaining results? Research shows us that the failure is not usually the result of poor strategy; failure is usually the result of poor strategy execution.

"Organizations often fail to execute their strategy-failure rates may range as high as 60 to 90 percent."

           – Kaplan and Norton, Harvard Business School, April 2005

Let's face it, we all fall short of our target every now and again, it's just part of life. So, perhaps the better question to ask is how can we improve our performance? I have pondered this daunting question for much of my career and would like to humbly share some of my findings and observations based on years of study and experience gained while working on many successful projects at companies like Delta Air Lines, MCI, Merck & Co, ING and Coca-Cola.

Almost without exception, both successful people and organizations seem to have a few things in common:

•    A clear vision of the future
•    Foundational values that are shared across the organization
•    Unwavering commitment to a common goal
•    A rigorous performance management system

Those that consistently succeed tend to plan their work and then they work their plan following a strict and consistent approach; they follow a methodology. Regardless of industry or company size, this seems to be a key formula for success. Think of the converse; without clear vision and direction, and a system for getting things done, we all seem to drift along, aimlessly consuming our most finite and precious gift ... our time.

I have had the privilege of meeting and working with some extraordinary leaders and organizations. Through my experiences, I have come to believe that there is a common approach to improving performance which consists of three distinct elements of work: Strategy Formulation, Strategy Execution, and Measuring Results. Simply stated, Strategy Formulation is the process of defining what you are going to do in no uncertain terms, outlining the tactics for how you are going to do it, and determining your measures of success. Strategy Execution can be described as putting your Strategy Formulation plan into action by actually taking the steps required to achieve your objectives (i.e., doing the work). Measuring Performance which can be described as keeping track of where you are on the journey from your current state to your desired state and taking corrective action as appropriate to keep you moving toward your objectives. This approach has been proven to lead to sustained success over time.

As with everything in life, there are no guarantees of success; however, if you follow the above, your probability of success will dramatically increase.

Measuring results seems to transcend to levels that can be understood across many barriers such as types of work, sports, languages, geographic regions, race, etc. I'll use a current example to illustrate this point. During the 2008 Olympic Games hosted by Beijing China, Michael Phelps achieved something that had not been accomplished by the 100,000-plus Olympians going before him. He won eight gold medals in world record fashion in a single Olympic Games.

What does this have to do with the lessons above?

Well, Michael Phelps' story seems to follow the pattern. He had a clear vision of winning gold medals and wrote down his goals, he had an unwavering commitment to those goals and a comprehensive performance management system to measure and track his results over time. The world knows how the story unfolds, but for me, one race seems to stand out above the others; that race was held on Friday, August 15, 2008, where he edged out Milorad Cavic of Serbia by .01 of second in the 100m butterfly. This gave Phelps his seventh gold medal tying Mark Spitz's record which has stood since the Munich Olympic Games of 1972. It is unbelievable to me that 1/100 of one second is the difference between a gold and a sliver medal. The next day he swam the third leg of relay where he helped our U.S. team come from behind in a race they've never lost at the Olympics. Jason Lezak closed the deal in the final leg with another world record in the 400-meter medley relay.

This win gave Phelps' his history-making eighth gold medal. History will now view Michael Phelps as the most successful Olympian of all time and the difference really boils down to the 1/100th of a second that gave him the win in race seven. It's an amazing story and one that clearly supports the fundamental concepts described above.

So, how can you get started integrating these concepts into your business? Here are some key steps for becoming a performance-driven organization:

Step 1) Define your desired outcomes in clear and compelling terms

Step 2) Assess where you are today and why you want to change

Step 3) Define how you are going to achieve your goals and create a plan

Step 4) Quantify the investment required and the return expected

Step 5) Understand the consequences of your actions

Step 6) Establish a balanced scorecard to track performance

Step 7) Commit to your approach and start executing the plan

Step 8) Create an accountability system to manage performance

Step 9) Make course corrections along your journey to your desired destination

Step 10) Become an organization that learns from failure and builds on success

Be intentional, be committed, focus on the desired outcome and remember ... things that get measured, get done!

Bill Price is the COO of Argus Management Consulting and is responsible for Business Development at Argus Benefits. Argus is a boutique Benefits Broker and Management Consultancy that helps their clients to develop and implement Employee Benefits Programs that attract, equip and retain a competitive workforce. You can reach him at bprice@argusbenefits.com.

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Want to Improve Performance? Measure It!

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Leadership & Management

Bill Price

August 19, 2008