In my 27-year career, I always found that managing people was the most difficult thing to do, particularly when they are distributed across different countries or have different cultural backgrounds. Individuals have their own personalities and motivations, and aligning their goals with overall corporate objectives is not their first priority. Enterprises and SMEs face similar challenges – whatever the size, staff performance management and reporting is a problem. Of course it's not just individuals: any organisation consists of multiple teams or groups of people, often working in different places or on the move. Beyond that, a business needs to collaborate effectively with many other companies – customers, suppliers and different types of partner. How can a company manage people and teams, to ensure they are effectively working towards the right corporate objectives? How can organisational and staff performance be maximised? And how can all this be measured and reported, without workers spending endless hours on emails and spreadsheets?
1.- Complex performance management
Like me, most managers find that maximising the performance of individuals and teams can be extremely challenging. Harnessing existing skills, talent, and knowledge, and getting the best results, are complicated tasks. The complexity is magnified where there is a mobile workforce, and where managers have to handle multiple projects with partners. We all work in a more complex and fast pace world, where companies expect you to manage multiple projects simultaneously, collaborate at distance efficiently and provide the relevant information immediately. Other factors that add problems are where a company has to deal with multiple sites, and where its existing software systems don't integrate well – leading to numerous sets of information that are difficult to match up, and people spending time populating spreadsheets for reporting. There is a huge amount of academic theory in this area, and you could fill a shelf with knowledgeable- sounding books that claim to help managers. Information overload may in fact just make the problem worse. A French researcher Caroline Sauvajol-Rialland wrote an interesting book called "Infobésité" about this issue. For me the work of Kaplan and Norton provides a useful guide. In the 1990s, Kaplan and Norton introduced the "balanced scorecard", a performance measurement system. Later, they created the "strategy map", a tool to help evaluate the links between intangible assets and value creation. These assets can be typically categorised as human, information and organisational. Kaplan and Norton identify four key processes in performance management:
- Clarify and translate the vision and strategy
- Communicate and link the strategic objectives and measures
- Plan and set targets, and align strategic initiatives
- Enhance strategic feedback and learning.
Over 20 years I successfully used this method with different teams and projects in the UK, France, Spain, Morocco and Mauritius.
2.- Inadequate tools
To understand the demands on companies, let's take a look at one industry sector that I know well – Utilities. In fact, I've worked in this market for 20 years, and seen many organisations struggle to achieve alignment of their teams with their overall strategic objectives. Today, Utility businesses across water, electricity and waste management are under increased economic and regulatory pressure. They are fighting a battle across many fronts: to deliver the service their customers are expecting, to replace an aging workforce, to increase efficiency and reduce costs, to boost their competitiveness, and to deliver the profits that shareholders require. At the same time, because a significant part of their operations is outsourced to subcontractors, they need to develop synergies across their value chain, rather than working in silos within the organisation, and they need to manage their asset portfolio better and become more innovative. How are they doing this? In the UK, France and Germany, corporates in this sector have mostly responded to these challenges by investing in Enterprise Resource Planning (ERP), Corporate Performance Management (CPM) and Business Intelligence (BI) systems. I would like to be able to say that these software tools have worked, but the diagnosis is not so healthy. While the systems have helped to some extent, there are limitations. These BI, CRP and ERP systems usually operate in separate silos within a company, with each division or site looking inward. The tools also tend to function poorly when they are applied to collaboration across the value chain. Looking from the top down, CEOs and executive managers still find it difficult to communicate their corporate objectives, and to ensure they are quickly and efficiently understood throughout the business.
3.- Limited mobile and cloud solutions
To support mobile workers on the field (who make up about half the Utility workforce) and to develop efficiencies, companies are turning to mobile and cloud-based solutions that are supposed to better address their needs, and which aim to be more agile and responsive. For a long period of time, mobile solutions have been deployed on mobile displays to help managing meter reading, field jobs and network maintenance activities in a more efficient way. Unfortunately, the existing off-the-shelf software products available in the market have limited features in the area of organisational performance management. In particular, the systems may not be able to effectively monitor business performance between different businesses across the value chain. Some solutions provide either reporting features or objective management, but they do not combine the two. Bespoke software is another option. Here, the problem is often cost, with a typical cost of $50,000 per mobile app or even more – putting such solutions out of the reach of small and medium size businesses, or of corporate business units that have limited resources. Even if the bespoke route is affordable, developing the software can be slow and complicated, putting an additional burden on a company that is already looking to save time and be more efficient. And there is the inevitable risk involved with new software, which may not work as intended, or misses deadlines and budget constraints.
4.- The challenge of managing millennials
As technology has changed, so have the people using it. Engineering is attracting an insufficient number of graduates at the same time as skilled engineers are reaching retirement. According to the UK Energy and Utility Skills, due to an aging workforce and significant capital expenditure programmes, in particular in new technologies, the gas, power, waste management and water industries need to recruit and train more than 30,000 staff over the next five years. Management practices today therefore need to address the need of a new generation of workers coming into the industry, the millennials, who are typically defined as workers around 30 to 35 years old and younger – although there is no general agreement on what exactly makes someone a millennial. At the risk of generalising, we can say that millennials tend to be keen to progress quickly, and feel that they deserve job satisfaction and rewards. While they bring boundless enthusiasm and new ideas, this attitude can make them seem impatient, and means they need more feedback than other workers. Existing managerial practices can struggle to keep millennials happy, and legacy systems may not provide the information and updates that they desire. In particular, millennials become frustrated if they cannot see how their job relates to the overall corporate objectives. Frustration leads to lack of motivation, and a drop in performance. Old-school managers run the risk of missing out on the input of their highly-educated, intelligent younger staff. These issues can be amplified by the attitude of millennials towards technology – they tend to be focused on the use of smartphones, and they often expect legacy business software to be as agile and easy-to-use as the latest consumer apps.
5.- Unfocused appraisals
HR performance appraisals are the traditional process for reviewing individuals, and assessing how they are functioning at work. But they have limitations, and often fail to keep teams aligned with strategic objectives. For a start, performance reviews are only undertaken comparatively rarely, and typically look backwards more than forwards. This lack of real-time review means that problems can take a long time to be spotted, and that people can be pulling in the wrong direction for months before the misalignment is addressed. The gap between the objectives given to people and their actual day-to-day job is rarely understood and managed. As well as inefficiencies in team performance, this disconnect is creating more stress for managers in a job function already prone to alienation and isolation from colleagues – particularly where mobility weakens the bonds within a group.
What can we do?
In this blog post, I have reviewed where many organisations are struggling, and how this can impact corporate performance. To overcome this, companies need to prioritise their staff's activities, and need to ensure that each person's goals align with the corporate objectives. This is easier said than done. Corporate objectives must be understood, and must be broken down into appropriately sized goals. There must be 360 degree collaboration tools that enable everyone to work together, and that provide the mobility needed by teams who work in different places, and possibly for different companies across the value-chain. Once goals are set, there is a need for constant monitoring and benchmarking – not just the snapshots provided by formal appraisals once or twice a year. Managers must be able to see in real time what their teams are doing, staff must be able to provide feedback, and there must be a way for everyone to discuss progress. All of this must happen in real time, effortlessly, without reporting burden, too frequent meetings and emails, and must be simple to use – or individuals won't engage with the tools they are given. These are the problems we have tried to address with Agily, our mobile Organisation Performance Management solution. Agily improves competitiveness and focus for companies, at an affordable cost.
Co-founder, Agily3 Ltd