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Top ten steps to effective performance management

15/03/2007


Behind every well-run business there are people and processes. Behind every struggling business there are people and processes. The very same components that make one company successful are also present in those that struggle to get by.

What makes the difference? It comes down to how well the people and processes are managed. You will often hear business owners say, “I wish I could get everyone to work like John” or, “I can’t get my staff to do their job!” Business problems that start out looking like people issues often turn out to be poorly defined business processes. When you face the issue of poor performance in your business, consider: Is it a People or a Process Issue?

According to performance measurement specialists Mentor Plus, ten steps will help you get to the heart and solution of most business problems you face.

Step 1: Define the issue. For example, “We are not getting our shipments out on time.” Survey those involved with the process to be sure there is consensus about the problem. If there is agreement on what the issue is, proceed to Step 2. If there is disagreement, invest the extra time required to understand the different perspectives and clearly define the issue.

Step 2: Map the process. Begin by getting agreement as to what the process really is. Have those involved with the process detail the actual steps involved. This is a very linear task, answering the question, “What do we do first, second, third, etc.?” Each person involved with the process is likely to see it slightly differently. Mapping a process can often highlight fundamental flaws that can be easily addressed.

Step 3: Analyze the problem. Is it a people or a process issue? Does it happen all of the time? Or does it only happen with certain products, certain people, or on certain shifts? Determining the relevant variables will highlight where you need to put measures in place.

Step 4: Measure the problem. Collect baseline data on aspects of the process that are problematic based on your analysis in Step 3.

Step 5: Narrow the focus. Based on the data gathered, determine where to focus your efforts to have the greatest impact on the problem. Whether the issue is people or process related may be self-evident at this point; if not, your measures may need to be refined.

Step 6: Make the invisible, visible. Share the data with everyone involved in the process. How often you share the information may depend on the process involved, but more often is better than less. Be sure to include data that measures work quality as well as quantity.

Step 7: Develop a strategy. Those closest to the issues generally have the best ideas on how to fix the problem. Work with the team to develop strategies for improvement. From there, you’ll want to set up testing parameters to track the effect of the new strategy.

Step 8: Test the strategy. Execute one strategy at a time. Measure the effectiveness of each strategy as compared with another. Take care not to introduce too many new variables to the process at the same time, as it may be difficult to determine which change had the greatest impact.

Step 9: Review the outcomes. Take the information on how each strategy performed and establish the new “best practice” as a standard procedure. If the new strategies are not yielding the desired outcome, it’s back to the drawing board to develop a new strategy to be tested.

Step 10: Refine the process. Over time, the activity of establishing a baseline, deploying new strategies, tracking their effectiveness, and then establishing the best performing strategies as the standard can be repeated to achieve ongoing gains.

These ten steps will serve as a guide to analyze and solve the problems you face in your business. Be sure to include those who have a direct impact on the problem when developing the solution. This will not only ensure team buy-in, it will also create a better solution - and be a good first step in taking care of your business.

By Wendy Lewis, CA. Published in the Comox-Valley Record. For more information, please contact your local MNP advisor or Wendy at 250.338.5464.