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Leading a Virtual Organization: Performance Management

Leading a Virtual Organization: Performance Management Program Transcript

CRAIG MARSH, PHD: So the third thing that I'd like to share with you is performance management. Now as you'll appreciate on a large, relatively large structure of around 500 individuals who are all over the world, one of my key challenges was really knowing how well they were doing. Now I did put in, as I mentioned, a leadership structure.

So I was getting feedback from-- informal feedback and qualitative feedback from my leaders about how things were going generally. But that really wasn't enough. In order to provide a really excellent service across all of those global areas, what I really needed was something that allowed me quickly to capture how things were going in those contact areas, in those service interventions. And to be able to use those data for business decisions.

And by the way, I'll mention that there are a number of issues with data driven or metrics driven performance management systems, which you'll probably appreciate. I mean, one of the critical ones is unintended consequences that you'll motivate behavior, or you'll incentivize behavior in a way which is quite crude. And which way results actually, in people doing the opposite things to what you really want them to do. But they meet your metrics. So I was very much aware and I was somewhat skeptical about how effective performance metrics could be. So these were the sorts of things that I was thinking through when establishing this system that I really needed to know what was happening.

So the first thing I did was to establish a system that would operate for me at, what I would call organizational level. Now, the organizational level system was essentially a dashboard. So I was able to collect an enormous amount of data from those service interventions of my front-line professionals. And what I did was to create a one page process with seven or eight of those key metrics summarized from right across the organization. That dashboard was used by me to keep up to date weekly on what was happening.

I developed a system which was very straightforward. A traffic light system red, yellow, and green. So that once indicators moved to a certain level, I could see at a glance whether something was working really well, moving in the direction that I needed. Whether it was something that really where there was a problem, that needed immediate attention. Or whether there was something that looked like it was, perhaps just trending in the wrong direction and was going to need some attention fairly soon. And what we did was establish a process of executive review of that.

So I was monitoring them weekly. But, three times a year we had the entire executive team in, where we would review those high level dashboards in order to see how the organization was progressing generally. And more importantly, to

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Leading a Virtual Organization: Performance Management

make decisions which were based on some of those indicators that we were seeing.

And the second part of the structure was where we were able to be a little bit more nimble or reactive to some of the indicators. And that was the business unit level. So in each service area, we were able to create a slightly more sophisticated report, more detailed report. Based on a similar sort of structure, based on the same data but where business unit leaders could actually use those data in response to them a little more quickly. Now what was critical about that response wasn't that when they saw something red that it was going wrong. Because, the way I phrased it to them was, that simply raises a question that you need to answer. It doesn't present the answer itself. And that's really critical in terms of managing these data driven performance systems. That when you see an indicator like that you don't think that something has gone wrong, but simply that it may be telling you that something is heading in the wrong direction, which you then need to investigate.

And the investigation really, was the third part of the structure which is the individual level. So each of those service professionals, for every service intervention they made with our customers, they were able to see pretty quickly after the intervention a report which told them how they'd done in that particular circumstance. And that was comprised of data from the IT systems. It was comprised of data which was a collection of feedback from our customers. So we were able to quantify that feedback and put it into the system. And it actually was based on some of their own feedback, so they were able to contribute to it themselves.

And of course what that information also provided was for those first-line leaders that I had appointed to be able to see how their teams were doing. And that was where, really, the final and critical part came in the performance management system. What I'd done was train these first-line leaders as coaches. And what that means is that you don't direct. When you see some data that seems to be going wrong in your team, what you do is you use that data for a coaching intervention. To investigate, first of all. See what's happening. Gain the feedback of that service professional. And then work with them to take actions and develop solutions to whatever it is that you overcome. So it's a combination. It's not simply using the data on its own. It's a combination of those data and the leadership, or coaching function, of those front line leaders.

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