Are your teams are REALLY performing while working remotely?
No wonder that performance of individuals and teams have got affected; the wonder is in the reasons; is it because of economy turmoil? Lockdown? Clients? Working remotely? Or is it our own team’s performance?
A mix of variables interrelated and interconnected that makes it so hard to get to the root causes of the slowdown. Measuring performance has been always a challenge, not only during COVID19 outbreak; organization – big or small- link performance with merit increase in pay plans, incentives and sometimes profit sharing for the importance of the collective individual performance affecting the overall organization performance, profitability and its market value.
KPIs gives management cause-effect relationship between performance targets and performance drivers. And thus, with this disruption, the BSC becomes a strategic management tool useful for implementing strategy and re-formulating it when bad results are scored or when there are major changes in the market such as what we face during and post CORONA time.
- Balanced Scorecard “BSC” is the perfect solution which can map the strategic objectives (Vision, Mission and Values) into performance metrics basing on 4 perspectives: (1) Financials, (2) Customer/Stakeholder, (3) Internal Process and (4) Organizational Capacity (People Development).
- These indicators will help in the business and people performance evaluation. It will also provide relevant feedback to a specific functions and management team.
- BSC provides CEO and her/his direct reports the needed metrics that can be used to measure business results in a way that can translate the organizational strategy to actionable objectives (assigned to all functions/teams) for future benefits and growth, in addition to focusing on important business drivers.
Difference between KPIs and BSC
Business leaders has been always thinking about different ways of business measurement and control. The most popular approaches are KPIs (Key Performance Indicators) and Balanced Scorecard. While both concepts refer to the business performance management, there is still a significant difference.
Balanced scorecard is a strategic management performance metric used to identify and improve various internal business functions and their resulting external outcomes. Balanced scorecards are used to measure and provide feedback to organizations.
In Pinnacle we think KPIs as a part of bigger picture of Balanced Scorecard. Balanced Scorecard measures business using several basic groups. Each group has its unique Key Performance indicators.
Is Balanced Scorecard a better approach” Actually, yes. It gives more flexibility. For instance, able to specify relative importance of indicators, e.g. balance them. When KPIs will do its job better than Balanced Scorecard” When you are not interested in global view over the performance problems (this is what Balanced Scorecard provides), but need to focus on a very tight niche, more over on some certain aspect of this niche, for instance, “Finances”. Finally, both approaches deal with metrics, measurement
Why Measuring Performance?
- To illustrate how the employee’s job contributes to the success of the organization by linking work efforts with the company’s mission, vision, and objective.
- To help employees know what needs to be done to be successful on the job by focusing attention on setting clear performance expectations (results + actions & behaviors)
- Each department focuses on what needs to be done and provides a solid rationale for eliminating unnecessary work though the use of objectives, standards, and performance metrics.
- Gives employees a clear path for growth by defining job-mastery and career development goals as part of the process.
- Enables the employees to quickly identify problems and change course of project or work assignment through regular check-in discussions, which include status updates, coaching and feedback.
- Focuses on performance as an annual event and sets it as an ongoing process by basing performance evaluations on the summary of status updates.
- The methodology involves a step-by-step elimination of all waste that accumulates in a workplace over time. Post identifying & eliminating all waste, a culture of continuous efficiencies’ improvement is put into practice. This results in both direct & indirect productivity.
We view the organization from four perspectives to develop objectives, measure (KPIs), targets, and initiatives relative to each of these points of view:
Financial or Stewardship: often named Stewardship. This perspective shows organizational financial performance and the use of financial resources.
Customer/Stakeholder: this perspective shows organizational performance from the point of view of the customer or other key stakeholders that the organization is designed to serve.
Internal Process: shows organizational performance through the lens of the quality and efficiency related to our services or other key business processes.
Organizational Capacity/ People (originally called Learning and Growth): shows organizational performance through the lens of human capital, infrastructure, technology, culture and other capacities that are key to breakthrough performance
Implementing a Balanced Scorecard with a SMART KPIs/ Objectives for your organization will provide a common language of communication between all functions, which is essential to:
- Provide an objective way to see if strategy is working and being properly implemented.
- Offer a comparison that identifies the degree of performance change over time.
- Employees’ focus their attention on what matters the most to succeed.
- Measure accomplishments, not only tasks.
- Help reduce intangible risk uncertainty.
Pinnacle is a multi-country consultancy firm. Our consultants are spread around the world; with 70% of our consultants are women. We have built our organization on modern business model with agility, diversity, and resilience to the business dynamics. We have chosen our technology platform to support our modern mindset thus we work from anywhere.
As work is not a place anymore. We implement Lean Six Sigma in everything we do whether internally or externally at our client sites.
Please use contact us and one of our business development managers will be calling you to support