Perfomance Management: The PLP Program
61% of respondents acknowledge that their firms often struggle to bridge the gap between strategy formulation and its day-to-day implementation. ”
The Economist Intelligence Unit: Why good strategies fail, lessons for the C-suite.
Bridging the strategy-to-execution gap remains elusive for many organizations despite the effort and resources dedicated to strategy formulation and implementation, making it difficult for them to be high performing organizations.
Building and sustaining high-performance requires organizations to improve performance in four interdependent dimensions:
Operational Dimension: Day-to-day operations need to be effective. Activities have to work as designed, for operations to be “healthy”. A high-performance organization performs similar activities better than rivals or peers perform them.
Strategic Dimension: Strategy is a continuous learning experience that is not bound by timeframes. It is not a five-year plan. It is having clarity of where we want to be, how we will know when we get there and how we are going to get there. High-performance organization perform different activities from anyone else or similar activities in different ways to get to where they want to be.
Purpose Dimension: Purpose is an organization’s reason for being, the value it intends to add to the world. It clarifies what the organization stands for, provides an impetus for action and is aspirational. Defining a corporate purpose helps organizations redefine their playing field, create a holistic value proposition and deliver lifetime benefits to customers. High-performance organizations look at the outside world to see where they can add value and respond accordingly.
Value Dimension: organizational values guide what is seen as good and important in an organization. Values influence an organization’s selection and evaluation of decisions and actions. Making these choices means change, and resistance is inevitable. The Or-thinking that is essential for learning and problem solving does not adequately address complex issues resulting from making strategic choices. High-performance organizations supplement Or-thinking with And– thinking (polarity thinking) to leverage the wisdom within the resistance to change and convert it into a resource for stability and change.
Traditional Performance Management Supports the Operational and Strategic Dimensions
Performance management methodologies are instruments of the mind, and they only take the operational and strategic dimensions into account:
- The operational dimension is about “doing things right”, i.e. the “discipline of execution”. Leaders deploy methodologies such as six sigma, kaizen and business process reengineering to improve organizational effectiveness. Performance measures in this dimension are transactional and measure the effectiveness and efficiency of activities.
- The strategic dimension is about “doing the right things,” i.e. managing the right processes to achieve desired outcomes. It creates focus and organizational alignment. Since every organization has some unique characteristics, processes and performance measures cannot be standardized. To be successful, an organization must have a strategy that sets it apart. Popular methodologies deployed to implement strategy include the Balanced scorecard, European Foundation for Quality Management (EFQM) Excellence Model and Critical success factors.
However, to create high-performance teams and culture requires both the “mind” and “heart”.
Performance Leadership, an Approach that Addresses all the Performance Dimension
Performance leadership entails establishing a clear direction, aligning, motivating and inspiring people and producing change. Our PLP Strategy Design and Execution Approach incorporates BSC concepts, and integrates PuMP, EBL and PACT into a performance leadership process.
