Emphasis on People

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.MANAGERS MUST GIVE PEOPLE AS MUCH EMPHASIS AS FINANCIAL RESULTS

Gordon L. Simpson

Many organizations, including not-for-profit enterprises and government departments, are not as successful or efficient as they could or should be. Some of the most common problems are high employee turnover including loss of the most valued people, disappointing individual performance at all levels, low productivity, and difficulty in coping with changing conditions.

Two main problem areas have been identified from an analysis of many problems and concerns of senior management across a wide spectrum of organizations. The first is inadequate control of an organization's direction and the second relates to insufficient attention to managerial and employee performance.

To cope effectively with changing conditions and increasing competition, leaders have to be in firm control of their organizations. They have to motivate employees and provide them with the working environment which enables them to perform at their best.

Control does not mean intimidation. It essentially has three components. Firstly it means having a clear vision of what has to be done and ensuring that vision is translated into appropriate direction. This is the crux of the problem and it is where senior management is most vulnerable and least effective.

Secondly, control means having a method to get accurate and timely feedback so management knows what is going on, and thirdly, it means ensuring all employees are motivated to perform to the levels required. The levels required must be defined and those performance standards enforced.

Control is a critical issue for executives and other senior managers. All too often, there is a gap between policy enunciated at the senior levels and what actually happens at the lower levels. This is the reason many leaders are not achieving desired results. They simply are not able to translate their intentions into reality.

To address the two major challenges of better control and increased productivity, organizations require an effective performance management system so they have the skills and procedures .in place at all levels to manage all aspects of their respective businesses..

Any performance management system will work best if it starts at the chief executive level and includes an entire organization. If the practice of the skills and procedures inherent in a management system is not mandatory, then the message being communicated is that double standards are acceptable within the organization. Another important point is that any system must be simple - if it is complicated it simply will not have the requisite support and will not be used.

A performance management system should not be theoretical or resemble an academic course on organizational behaviour. Such an approach will not help management to improve performance. It may help to improve their understanding of human behaviour, but will not make them better people managers or enable them to chart clearer direction for their organizations. A system should help organization leaders translate theory into practical approaches for effectively managing people and achieving the goals of the organization.

Good performance does not just happen. It has to be planned and carefully managed. Since few people are naturally excellent, organizations must improve the majority who perform at less than optimum levels to achieve competitive levels of productivity.

Improved productivity through better management practices is the key to maintaining one's competitive edge. This involves more than training. It requires that the fundamental approaches and skills of good management be installed in an organization so there is consistency in how employees are managed from the CEO to the most junior supervisors. Successful installation of a performance management system will generate results whereas an ad-hoc approach to individual training is unlikely to yield the desired benefits.

No matter how good the training is, if the skills and knowledge are not built into the individuals' jobs and employees are required to use them in their work, the value of the training will be short-lived.

It is important, therefore, that organizations consider the importance of a comprehensive management system that when installed, becomes part of the culture and method of operation of the business.

This approach protects an organization from losing its investment in the training of individuals who subsequently leave for whatever reason. Furthermore, a properly constituted management system will give senior management a process and the structure to effectively translate its intentions into reality - to make them happen. This benefit, combined with significant increases in productivity that occur with a good management system, gives organizations a very fast return on their investment.

Many great ideas have been discarded - not because they lacked merit, but rather because management was not able to make the idea happen. They did not have sufficient control over their organizations to get their ideas installed and working as they intended. Failure to install changes in direction or achieve objectives is costly and is the fundamental reason why so many enterprises are not as successful as they could be.

Most organizations have in place a financial management system of some sort. It may vary from an elementary to a very sophisticated system but much care and effort is devoted to ensure their financial resources are managed as effectively as possible. A large percentage of senior management time is spent ensuring the greatest return on invested capital. Monthly statements generate a frenzy of activity as they are analyzed, variances from budgets investigated and corrective action taken as deemed necessary.

It is somewhat ironic that the same diligent approach is not taken with respect to the management of employees in an organization. Just as a financial management system helps management identify where their business may be off track compared to the budget, seldom is there a parallel people management system that would allow decision makers to compare managerial and employee performance against standards and take timely corrective action when performance variances exist. After all, the success or failure of any organization is dependent upon the quality and performance of its people.

The business climate today, especially the pressures from rapid change and increased competition, demands that a comprehensive system for the management of the performance of all employees, from executives to the rank and file be implemented in organizations. Raising the awareness of the importance of performance management and forcing managers at all levels to pay as much attention to people performance as financial results will help immeasurably to equip any organization to meet the challenges of today's business climate.

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