FROM JIM SIRBASKU’S DESK
To Improve Corporate Performance, Look Beyond the Process
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.
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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:
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.
To read more, click here to download a PDF.
