The performance management system
Many companies have strategic plans but they often do not work well because they are not implemented. As Fortune discovered, Less than 10% of strategies effectively formulated are effectively executed.
The workforces of many companies go about their daily business totally unaware of the fact that their companies have strategic plans. As a result, there is no relationship between company plans and the workers’ activities.
The key to success lies in translating the vision and the strategic business plans into the everyday activities of the people who are actually doing the work, adding the value, providing the service, so that everybody knows exactly what they have to do on Monday morning in order to achieve results.
Of all the things I’ve done, the most vital is coordinating the talents of those who work for us and pointing them toward a certain goal. Walt Disney
The first essential component of team performance is a unified sense of direction.
A unified sense of direction can best be summed up in the phrase one team, one direction. A unified sense of direction means that all the departments, teams and individuals that make up an organization are pulling in the same direction. Or to put it another way, everyone is singing from the same song sheet and is working harmoniously together to achieve common goals.
To achieve a unified sense of direction there needs to be agreement at all levels on what the organization values, what it does, where it is headed and how it plans to get there.
Last month I wrote about the importance of a unified sense of direction, vision and business planning.The next essential component of team performance is organization strategy.
Strategy formulation is the selection of the best course of action in order to achieve the organization’s vision. Basically, strategy formulation defines how the organization is going to achieve its vision, or how to close the gap between where it is now and where it wants to be. In other words, it identifies the correct road map to follow in order to arrive at the desired destination.
How to double profit in large technical organizations
The question has been asked: as a manager, you come to your office to find that you have all your plant and equipment, but no people, what would it cost to do what was necessary to develop a new group of people to a point where they were functioning with the same degree of effectiveness as the original organization? Estimates range from 20 to 30 times the annual earnings of those people and suggest that a 4% deterioration in the value of the human organization will completely offset normal profits.Similarly, a 4% improvement in human effectiveness will double normal profits.