Do you have plans to improve your corporation's performance? How do you plan to do it? This article will provide you with ways to improve corporate performance and use the right measurements to make sure you're on the right track. Whether you're an executive, a manager or a team leader, the following information will be beneficial to you.
Although many companies are focused on improving corporate performance, they may be using the wrong measurements to keep score of how they're doing. The CFO, for example, might be using the yardsticks of revenue growth, cost of goods sold, days in inventory and DSO, or days sales outstanding. His attention may be glued to hot new developments in business process improvement and using software to automate processes.
Software and technology are great, but whoa! Let's look at more than process improvement to better our key financial measures. Although seeing the needle rise on financial performance is crucial to all organizations, getting it into the stratosphere requires improvement in more than just the process area. It requires that leaders take a broad view of the company and look at the combination of everything - process, systems and people - and envision them all clicking together.
This is not to accuse leaders of ignoring poor performance. But many do fail to see the big role that people play in processes. We can automate process and measure process and monitor systems, but the area with the highest degree of variability is the one which people occupy.
How do you measure the effectiveness of people? That's a very good question. One way to do it is to measure employee engagement, a seemingly fleeting quality in our organizations. If you doubt this, just follow the numbers to their sad conclusion. Surveys show that less than a third of workers describe themselves as engaged in their work. Engaged employees are the ones who care about the job enough to perform at the highest levels. Another 10 to 18 percent, are deeply disengaged, and are even looking elsewhere for employment. The rest, about 60 percent, fall somewhere in the middle.
But instead of looking at employee performance when financial numbers are weak, top managers often look at the business process to see where the errors are.
We all must understand that we cannot remove the employee from the process. People play a critical role in processes, most significantly when something outside the norm of the process happens - a glitch in the software, if you will. Perhaps a customer heats up the phone lines with a billing discrepancy. Only people can figure out the problem and find a solution in which both the customer and the company win. It is people who must perform superbly to solve the problem, and that means an engaged employee, one who understands the problem and cares enough to see it through to a solution.
Until top managers realize that employee engagement plays a key role in driving financial and operational performance, and put engagement-friendly programs in place, they will not achieve the level of performance they desire. Employee engagement is not only about turnover or worker satisfaction; the boredom or indifference of an unengaged employee touches everything, including financial and operational statistics.
For example, an accounts receivable problem might really be a "people problem," and it might ripple across the whole company. Although the CFO turns to the accounting department when he sees a money problem, the real weakness could be:
- A problem in customer service that creates unhappy customers who are paying slowly
- A problem in sales that is turning customers against the company, causing slow payment
With all of the potential places that irritating problems can hide, don't you want more than a third of your employees trying to ferret them out and eradicate them?
The unengaged workforce is a tough problem - otherwise it would not stick to us so stubbornly - but we can make headway in addressing it. We can do it by:
- Making sure we have the right person in the right job from the very start
- Providing training that ensures employees have the skills to do their jobs
- Putting in place managers who understand what their employees need and show them how to get it.
We have to address the issue of workforce engagement on several fronts, just as we do any dug-in problem. Only then will we begin to see that small percentage of engaged employees creep up, maybe to 35 percent, 50 percent, or even higher. Only then will other significant numbers begin to rise as well. The sky's the limit.
Author Resource:-
Jim Sirbasku is co-founder and CEO of Profiles International, a leading provider of human resource management solutions and employment assessments for businesses worldwide. For more information about how you can improve corporate performance, visit our website.
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