9.1 THE SKILLS YOU NEED TO BE A GREAT BOSS: Linking Activities to Vision and Strategy

(SHORT NOTES FROM TEAM MANAGEMENT: Performance Management at http://www.mindtools.com)

 

Managers talk a lot about employee performance.  There's constant pressure to achieve performance targets, to reach higher performance levels, and to ensure that people's work supports and furthers the organization's goals.  Performance management is the process used to manage this performance.

Traditionally, managers look for hard data to tell how well an employee has performed his or her duties through performance evaluation process.  The part about making sure that the employee is doing the right thing, however, is missing from this evaluation.  This is where the key performance indicator comes to play.  A Key Performance Indicator (KPI) is a quantifiable metric that reflects how well an organization is achieving its stated goals and objectives.

While it is important for organizations to choose the correct KPIs for business performance, it is equally useful if managers and employees define KPIs for members of their teams.  This helps people work in such a way that their activities are aligned with corporate strategy.

What is measured gets done

Part of performance management is setting goals with members of your team.  This may be done within the formal appraisal process.

 

Aligning Objectives With Organizational Goals

We're often reminded about the corporate mission statement, we have strategy meetings where the "big picture" is revealed to us, and we're even invited to participate in some business decisions.  We're also kept aware of how our day-to-day activities contribute to corporate goals.  This type of managing is called Management by Objectives (MBO), a system that seeks to align employees' objectives with the organization's goals.

MBO
Advantages	Disadvantages
team members are clear about their work and how it benefits the whole	can be challenging and lengthy to implement
makes a clear link between individual effort and the organization's mission	needs the organization's full commitment
	needs an underlying system for tracking goals and performance
	goal transmission can be slow