Performance Management: Dynamic not Static

Recently I reviewed a five page performance appraisal tool used by a software company that they believed was excellent, and they couldn’t understand why very few people were using the tool. I brought up the notion of Dynamic appraisals vs. Static appraisals. Static is a one off event completed to cover compensation issues. Dynamic is an evolutionary process that is nurtured and grows more like an organism that adapts to the business, market and behaviors.

After our discussion they started asking a lot of interesting questions; How do we get folks to adopt a dramatic approach rather than a check box approach? Can HR be the drivers of the adoption? What role should business leaders play?

These are the right questions that need to be asked, and now they are turning the tide by facilitating business adoption through aligning business leaders to competency drivers that bring out optimal performance. Optimal performance is getting people focused on their strengths and designing functional areas so that the collection of individual skills are stronger than any single individual. In other words, creating synergy that drives the business based on KSAs that are motivated and dynamic rather than static.

Static drivers create status quo performance, and aren’t very measurable. Dynamic drivers are immediately impacted by the market, competitors, economy, etc. We can prepare for changes, ie: gas prices increasing, and have contingency plans. Building performance management systems that focus on dynamic business processes will allow an organization to have more dynamic focus on growing the business rather than maintaining it.

Does this make sense? Is it just easier to manage performance by static events? Can anyone share an example where the business drives Dynamic Performance Management?

Please let me know your thoughts.

- Nat Boughton

Looking at the Forward Edge

The forward-edge-of-the-customer-area, or Forward Edge, is the foremost limit in the network of capabilities where business capabilities are deployed in direct contact with the customer. These capabilities probably make up 15-25% of the capabilities in your business.

Extra attention should be paid to Forward Edge capabilities. The Forward Edge is a two way street. This is where you create the relationship with your customer. It is also where you can be learning from your customer how to improve your ability to meet the customer's needs and expectations.

There are a number of areas where you directly interface with your customer. These include product development, sales, product and service delivery, when the customer uses your product or service, customer care, and invoicing and payment. These capabilities should be focused on meeting the customer's needs and learning what opportunities exist in the market.

Many businesses make the mistake of using technology or outsourcing to cut costs in these areas without considering the customer impact. When technology and outsourcing is used to improve the companies capabilities at the Forward Edge, its great. But when the customer experience or the ability of the business to learn what the customer's emerging needs are is compromised, these are not good ways to implement the Forward Edge capabilities.

How clearly do you understand the customer's expectations at the customer edge? How well aligned are the other capabilities in your organization to meet these expectations? What do you have in place to understand your performance here and to learn about emerging customer needs?

At the Forward Edge with State Farm, Enterprise, Pizza Hut

The Forward Edge is that point where the capabilities of your business, interact directly with customers. This typically comprises a small number of the capabilities in an organization, but this the most important part of a business. There is something to learn for our organizations from looking at our experiences as customers at the Forward Edge. I have had three notable Forward Edge experiences in the last few weeks.

I was rear-ended a few weeks ago by a driver with State Farm insurance. We reported the accident from the scene and got a police report. State Farm took everything they needed from that initial report and the police report. They arranged for the appraisal, scheduled the repair at my car dealership, handled all the paperwork with the dealer, arranged for the rental and payment of a rental car, and paid every cent of everything. Their interactions with me were timely and professional.

Enterprise rented the car to me during the time the car was being repaired. They picked my up at the dealership when I dropped off my car, had the car ready when I showed up, called a couple time to make sure I was happy and that the service had been friendly, checked me in quickly and drove me back to the dealership when it was time to pick up my car. Their interactions were too warm and friendly from my perspective, I don't need an emotional connection when I'm renting a car. The calls to check on my satisfaction both came a bad times during the business day and took too long. But they were consistently friendly and warm.

On Friday, I tried to order pizza from Pizza Huts website. My password wouldn't work. I tried the option to resend my password, but after 30 minutes had never received my password - I even checked my spam folder. I tried to register again but I couldn't because I had already used my email address. I tried to look up the menu, but couldn't because the system said I was in the middle of placing an order. Their use of technology frustrated me.

So I called customer service. They could not reset my password or make sure it got sent to me. They had to forward the request to their web master. It took four days for my email and password to get to me. They knew this was a problem that people were experiencing. They couldn't take my order either. They gave me the number of the local Pizza Hut to call. When I called, the person that took my order was obviously very busy and let me know that in the future I could place my order on-line. Their use of technology did not serve their business either.

State Farm clearly has their capabilities aligned with the customer's needs and expectations at the Forward Edge. Their use of technology to integrate with their partners and keep track of everything was seamless. Enterprise also has their capabilities aligned with the Forward Edge. I wonder how many other people feel that the tone of the service reps on the phone calls were too invasive or took too much time with pleasantries. Pizza Hut has the trappings in place of serving the customer, but their capabilities are not aligned with my needs. I sure the ordering system saves them a lot of time and expense, but I may never order from Pizza Hut again.

Pizza hut made an unhappy customer and wasted a lot of their time because their website has a bug and their customer service reps don't have access to the right tools. How well do you understand your capabilities at the Forward Edge? What do you have in place to understand the customer's needs and satisfaction at the Forward Edge?

Blog Update Complete

We have completed the move of our blog over to http://blog.synaptus.com. If you are still receiving this blog at synaptus.blogs.com, please update your links. Part of the upgrade involves an update to the way we will blog.  We will try to provide focused blog entries you can read in less than three minutes. We will continue to publish the e-zine with a more detailed article every week.

Back in the Saddle

Its been a couple weeks since there has been regular activity on this blog. I have not been actively blogging for a few weeks. Spring Break with the family, a sinus infection, a series of client commitments, and collaborating with some very exciting thought leaders in the project management community has consumed my available time.

But there is a silver lining. My research and the collaborations regard the social aspects of project management. This is a area rich with opportunity to improve the performance of project teams and therefore the ability of organizations to execute on their strategy. I look forward to making for the lapse in activity by sharing insights in this area.