Marisa Fong and Galia BarHava-Monteith highlight the importance of creating a culture of accountability within your business or organisation – and how to go about achieving it.
In the August 2017 issue of NZBusiness we wrote a piece on KPIs – what should be measured and why. More recently we attended a workshop that we took some of our clients along to.
Alongside 70 others, we listened to international business guru John Spence as he covered a range of topics concerning Business Excellence.
There were many key concepts ranging from customer centricity, operational excellence, business models and so on. However, the key topic that everyone agreed they got the most value from was how to create a culture of accountability.
It occurred to us that there really is no point in having KPIs, if the people in the business aren’t held to account.
Performance management and achieving excellence consistently at all levels of the organization is predicated on the fact that everyone understands that they’re accountable and required to meet their KPIs, and that they agree to the performance measurements.
So, here’s a summary of what is required to create that oft-sought and hard-to-achieve consistency of performance excellence and clear accountability.
100 percent clarity plus appropriate authority and resources – Are the KPIs specific? Are they binary? (See more below). Are they supported by the right people in the business? Are there sufficient resources to achieve them?
100 percent agreement – have the employees write out the KPIs themselves as you both discuss and agree. Once they are documented, then you both sign the document with a statement that it’s a reasonable goal to be held 100 percent accountable to those KPIs.
Track and Post – make it highly visible and easy to understand. There may be resistance for this to be public but it’s necessary for everyone to understand the importance of accountability to the team. The intent is to create a culture of accountability to the whole team and company, not solely to measure their individual performance.
Coach, mentor, train and support – use an easy dashboard of Green, Yellow, Red. Help those in the Yellow, following the policy of train, transfer, terminate. (See below for more on this). Tracking becomes acceptable when people see it’s not punitive but there to help them and the ompany do better.
Celebrate success, and refuse to tolerate failure.
The most powerful concept to come out of the workshop for us, was setting binary KPIs. That is, the KPIs are either achieved or not achieved.
There can be no ambiguity in the outcomes. A simplified example might be, asking an accounts person to make sure all payments are received in a reasonable timeframe. What is reasonable? How can you performance manage someone if reasonable is not defined.
The binary example is that 90 percent of all accounts receivable are paid within 30 days of invoice date, and that no more than ten percent sit within 60 days. It is either achieved, or it’s not.
Train, transfer or terminate
If someone is struggling to get to Green and consistently sits in the Yellow dashboard, and if they evidence the correct behaviours and culture fit, then it may be they just need more training to show them how to get to Green. This is where having the right resources matters. If you don’t have the resource to train, then there’s no point in setting that expectation. They will need to be able to perform or not, as your organisation doesn’t have the leeway to accommodate non-performance.
If they still don’t get there, then a transfer to a more suitable role could be the answer. And if that isn’t an option, then termination is the only option left.
Should this happen, and the results of everyone has been tracked and posted, and you’ve tried to train and coach them, then it will be no surprise to anyone (including the employee concerned) when termination occurs.
Consistency and clarity
A final thought – holding people accountable must be one of the most challenging things a leader has to do in their business. Consistency and clarity are key. What we liked about the binary KPIs is that it takes the emotion out of any performance discussion. Especially if you have both agreed to the KPIs and that they’re reasonable.
Often, leaders and managers have difficulty with performance discussions because they worry about the reaction of the other person. Or worse, the discussion is avoided because it’s too hard. The responsibility on the leaders and managers is the follow through and consistency needed to demonstrate commitment and the importance you place on accountability.
If you’d like to know more about creating a culture of accountability, contact Jo Brady to register for our next workshop on Culture Building.
Galia Barhava-Monteith and Marisa Fong are co-owners of TBC Partners (www.tbc.partners) – a business consultancy focused on what it believes are the genuine challenges facing entrepreneurial, founder-based organisations in New Zealand