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January 2009

What do we know about people performance?

"If a company were as ill-informed about its capital performance as most companies are about their employee performance, it would be in serious trouble with the investor community." Shareholder Value May/June 2002

Or maybe not!

I just came across this headline earlier today and could not help being struck by the irony. I guess the collapse of the financial services industry reveals that these companies, at least, were pretty ill-informed about their capital performance.

Yet somehow the trouble they have reaped does not seem to be quite as serious as this headline seemed to imply it would be. Governments all over the world are rushing in blindly to pour in trillions of dollars to "bail them out" and, while questions are unquestionably being asked, the general consensus seems to be to fix the problem first. In comparison the investor community's response actually has been remarkably muted. It appears to be more concerned about the possible nationalisation of its interests than holding the company officers to account.

Capital performance that badly monitored, just begs the question, "How bad, then, is the monitoring of people performance?" What is particularly worrying is the fact that the financial services industry is a people dominated industry. In other words, it is one where the monitoring of people effectiveness is, or should be, at least as important as capital performance monitoring. With more than half a million people having lost their jobs in the past month in the US alone, it would at least be reassuring to know that management got this right.  

So then, new measures are urgently needed to police management effectiveness at both overseeing capital and people performance. The employee engagement solution Zealise offers certainly provides a good starting point for the latter. Engaged employees are people who act as if they own the business. They care, and because they do, they actually provide a brake on short-term management thinking and inappropriate management behaviour. And, of course, that is the standard of employee engagement that we provide. 

Putting a New Perspective on Productivity

Is it possible that productivity is over-emphasised in the modern workplace? Have we reached the point where the focus on productivity is counter-productive?

It is probably one of the few irrefutable facts of organisational life that every leader is looking to improve the productivity of his/her organisation. Whether private or public sector, for-profit or non-profit (or even a utility trying to encourage its customers to consume less), every organisation strives to do more with less. This is simply the framework within which organisations operate.

Of course, the economic imperative demands that optimum use is made of resources, and that is what ultimately what productivity is about. So we are by no means suggesting that productivity is not important. It is just that …. Have you ever been in a room and been told not to think about a giraffe? What was the outcome? Of course, you promptly thought about a giraffe! Or have you noticed the child, who when told not to spill the milk s/he is carrying, often ends up doing just that?

This psychological inversion creates a counter-productive pressure that all too often leads to precisely the consequence we least desire. Of course this is the principle behind reverse psychology and is hardly news. Yet, we cannot help wondering the same phenomenon applies to productivity and whether the demands to be more productive do not in fact make people less productive. After all, Samuel Johnson once said, “People need to be reminded more often than they need to be told”  

Perhaps the time has come for a different approach, and, while reverse psychology might not be the appropriate solution for improving productivity, there is certainly scope for a little role reversal.

One very simple definition of productivity is “the time actually spent on activity that adds value.” In the modern, globally competitive world, speed is of the essence and thus no-one can effectively supervise how another person spends their time, simply because time does not allow.

It is therefore impossible for managers to meet this demand and thus to retain responsibility for productivity. The best the manager can do is to enable an environment in which the individual can produce to an acceptable level.

The million dollar question is, “How does one do this, particularly in the prevailing climate of poor levels of employee engagement?”  For the real challenge is to identify the means whereby:

  • People will happily pick up the delegated accountability;
  • This delegated accountability will increase role ownership and hence inspire greater employee engagement;
  • Management will free up the time they currently spend trying to address these two problems;
  • Productivity will inevitably improve as a by-product of greater collaboration and engagement.

All rather daunting, so what would you say if we told you that the answer is actually relatively simple? Some might argue that this is essentially employee empowerment and that you have already embarked on empowerment initiatives, with disappointing results.

Unfortunately, 'empowerment' is a word that is open to many interpretations and even more ways of being introduced. Consequently, there is no consistency, and – as already illustrated – it is undermined by the ongoing focus on improved results to demonstrate the effects on productivity. Thus the ingrained element of 'telling' rather than 'reminding' remains dominant, and erodes these efforts.

The catalyst to change this is quite simply to take the statement “People are our greatest asset” literally and start valuing people in this way. Not only will this give management more credibility, but it will cut clean through the forces which shape behaviour to prevent this happening in practice. It will:

  • Induce greater self-interest on the part of the individual and awake the competitive urge to maximise that value;
  • Through that self-interest, stimulate greater role ownership which will engender greater engagement;
  • Eliminate much of the demoralising and demotivating consequence of regarding people solely as “costs” which contributes so much to employee disengagement.
  • Induce the individual to manage their own time more effectively; and thereby effectively devolve productivity through the organisation;
  • Improve managers’ own productivity by simultaneously relieving them of their most fruitless and time consuming activity and alleviating their biggest headache of how to engage their employees;
  • Provide a primary organisational productivity measure (‘Return on Human Assets’) that will be more transparent, secure the buy-in of manager and individual alike, and thus provide a basis for meaningful analysis with greater collaboration; 
  • Recognise and acknowledge people as the primary determinant of competitive advantage.

All this will have a sea-change effect on productivity and, paradoxically, without any focus on the subject of productivity, prove a conclusive answer to our opening question.

We would suggest that this approach of valuing people as assets and setting up appropriate KPI to measure their effectiveness provides an essential first step in creating the new management model set out in Gary Hamel's latest book, The Future of Management. We accept that valuing people is primarily a catalytic force, but it certainly offers a powerful solution to a number of management’s most pressing issues.

This edited version of my paper "A New Perspective on Productivity" was co-authored with Professor Cary Cooper, Professor of Organisational Psychology & Health and published in the January 2009 edition of Professional Manager magazine. Unfortunately it misses some of the key linkages of the original, so contact us if you would like a copy of the original piece.

Employee Engagement & Personal Responsibility

Distilled to its most basic, an employment contract is, in essence, an agreement:
1. Between an individual and an organisation that the individual will fulfil certain duties required by the organisation.
2. Undertaken between two parties without any coercion by one party on the other.

Surely you would agree? If so, you will also agree that each party has certain binding rights and corresponding obligations as a result of that agreement. One of the primary consequences then is that the organisation has the right to expect that the individual will perform those duties to the best of their abilities, and thus that the individual has an obligation to perform to the expected standard. I would go even further, and suggest that any self-respecting employee will also feel an obligation to themselves to do their best, as their work is a primary means of utilising and developing their talents and achieving their own self-fulfilment and life-purpose. 

Consequently, by definition, employee disengagement means people are not fulfilling their personal responsibility to either their employers or themselves. It doesn't matter why employee disengagement is so prevalent or who is to blame: both parties need find a solution and create an environment where people can honour their personal responsibilities.

Authors B.J. Gallagher and Steve Ventura provide some great tips as to how this might be achieved in their book, 'Who Are "They" Anyway?' They list as the benefits for each individual adopting a 'personal accountability attitude':

  • You have more control over your destiny 
  • You become an active contributor rather than a passive observer 
  • Others look to you for leadership 
  • You gain the reputation as a problem solver 
  • You enhance your career opportunities 
  • You enjoy the satisfaction that comes from getting things done...the power of positive doing 
  • You experience less anger, frustration and helplessness ? all leading to better physical health 
  • You realize a positive spillover effect into your personal life at home

According to them, the most important words of personal responsibility are as follows:

The 10 most important words:
I won't wait for others to take the first step.
The 9 most important words:
If it is to be, it's up to me.
The 8 most important words:
If not me, who? If not now, when?
The 7 most important words:
Let me take a shot at it.
The 6 most important words:
I will not pass the buck.
The 5 most important words:
You can count on me.
The 4 most important words:
It IS my job!
The 3 most important words:
Just do it!
The 2 most important words:
I will.
The most important word:

Frank Tyger said "Your future depends on many things, but mostly yourself."  Maybe individuals and organisations alike need to think about the innate wisdom of those words and create an environment where this is encouraged. Personally, I still don't think there is any better catalyst for achieving this than formally accounting for people as assets. 

Spreading the Good News

Happy New Year to all my fabulous readers and fans out there! (grin) I hope you all had a happy holiday and I wish you all the very best for 2009!

2009 has got off to a great start! I was recently given the opportunity to be interviewed by Anna Farmery for a podcast for her Engaging Brand blog and the interview has just been posted.

So, if you really want to get an insight into what the Zealise proposition is all about, you can do so by clicking here.  (If for any reason the link doesn't work you can access it directly by typing the following URL and selecting the podcast - Show #212, "Human Capital Measurement."