I was with an MD a few weeks ago mapping out the sales strategy for 2014, he is a new client and whilst he had made money in 2013, the margins were shrinking and he felt his firm were being held to ransom by customers who were having their heads turned by competitors offering more commodised and cheaper offerings, buying the business and destroying the market at the same time
He wanted a plan that would put him and his business in a position where:
- They weren’t forced to discount
- Their clients remained loyal
- They were more proactive in more profitable sectors and
- They could grow their margins
All of this is achievable but the issue that will probably hold us back more than anything with this client is the ambition, skills and attitudes of his senior management team.
I know some of you will be muttering at the screen that we should use incentives with the senior managers to get them to deliver, to motivate and energise the workforce.
Regardless of what my gut instinct is and irrespective of what I expect the outcome will be, processes have to be followed. Performance management has its place here and that’s the process that will be followed. Some will succeed and some will not. Some will be rewarded and some will move on to find new roles.
The question is, who picks up the cost whilst this process takes place?
Invariably it’s the business and the business owner, therefore, I am going to use my meeting with this business owner to highlight something that I would like all business owners and senior managers to be aware of every minute of every day.
Performance Management is not something that happens when we suspect that an employee – however senior or junior is not pulling their weight, or contributing positively in terms of skills, attitude, commitment, results. Performance Management is a day-to-day ongoing activity, and this is why.
Starting a Performance Management process can take a minimum of three months to actually impact on the business (there may be certain instances where the impact is immediate but this is rare) therefore the first opportunity that the business owner has to protect the business from any issues surrounding this is three months minimum.
That’s a long time when a business is in trouble or in a business that wants to improve its performance in order to grow, or maintain a stable turnover/profit.
Much damage can be done in three months – but yet that is the process that we have to go through using Performance Management.
Performance Management should start immediately the person takes a post. If the person performs in their role then there is nothing to worry about, however, if they don’t then the systems are already in place to protect the business.
There are other options of course – we could look at compromise agreements but these can be costly, we can look to accelerate the process but that can be costly too for a whole different set of reasons.
So business owners – be rigorous and diligent about your performance measurement – approach non-performance and non-conformance immediately and pro-actively to address the issues and be prepared to take action.
Waiting until the wolf is at the door is not the answer and waiting until the non-performance and non-conformance becomes the norm is simply a slow slide into a place you really don’t want to be.
Carol Griffiths – Director and Lead Consultant
Morton Kyle Limited
0779 002 1885