I was recently asked what the critical factors for successful organizational performance management (OPM) deployment are. Rather than keep these CSF’s to myself, I thought that I’d share them here with you (listed in no particular order):
OPM is recognized as an organizational priority
For many organizations, implementing and adopting OPM represents a significant shift. An organizational change of this magnitude will almost certainly encounter resistance – often displayed as attempts to continue doing things the “old way” rather than placing a priority on new activities and efforts. The only way to make the required organizational transformation is to declare OPM an organizational priority and then follow through with aligned expectations for appropriate actions and behaviors.
Full Executive and Senior Leadership Team commitment
In successful organizations, the chief executive, his/her team, and the senior management group must all be willingly to demonstrate active commitment to the OPM journey and take all steps required to enable its success. What does this “look like”? Walking and talking OPM and modelling requisite behaviors at all times and across the entire organization.
Employee availability, and active participation, in OPM processes
A key to developing organizational buy in for OPM, and producing high quality products and outputs (e.g. a strategy map, balanced scorecard indicators, etc.) during the OPM journey, is involving a broad range of employees (from multiple functions and levels) in a variety of OPM activities. The key to achieving the desired level of employee involvement is helping employees participate in working sessions and “homework” activities – this can only be achieved when managers: (1) communicate the importance and value of active participation in these activities to employees; and (2) take the steps required to release employees from their day to day duties so that they are free to participate in OPM activities.
Make a Commitment to Conversation
When it comes to strategy formulation and OPM, our traditional predisposition is to take a top down approach. That is, strategy is created at the executive level and then rolled down and out to the organization for execution. This approach has failed on so many levels for long enough that you’d think that we’d know better by now. Unfortunately, this isn’t always the case. These days, better business performance results are achieved when strategy formulation and execution/OPM are completed through a process of two-way dialogue that engages your organization and even other stakeholders. Yes – it can be messy and matrix-y, and require multi-tasking but it’s the only approach that enables agility in these constantly evolving, dynamic times. As a result, organizations that are committed to achieving success through OPM must also be committed to an ongoing process of dialogue and two-way exchange.
Ensure appropriate infrastructure deployment
Successful OPM deployment requires defined/clearly allocated financial and human resources, tools, and technologies. Organizations that are serious about achieving success on their OPM journey set aside the budget and aligned resources required to get the OPM results they desire.
Put accountability structures in place
Successful OPM deployment requires clearly defined roles and processes, governance structures, and assigned accountabilities. Accountabilities for OPM, including expectations for performance and behavior, must be built into employee job descriptions and the corporation’s people performance management process. Including OPM accountabilities in employee goal plans and assessing employee success in executing their accountabilities must be part of the performance appraisal process. Rewarding and recognizing the completion of required OPM accountabilities is the best, and fairest, way of ensuring that OPM activities actually happen as required/desired.
Identify a permanent owner of the strategy management process
Strategy management is a key business process that frequently goes without a dedicated process owner. Lack of dedicated ownership results in the sub-optimization of the strategy management process and progress on the OPM journey. Successful organizations assign a designated process owner or implement a team, such as the Office of Strategy Management, to lead the strategy management process. In this role, the process owner must have a direct line to, and trusting working relationship with, the chief executive. This allows the strategy management process owner and the chief executive to form a powerful team that is able to move the OPM agenda forward quickly and effectively.
Focus on making strategy the way we work
A key to ensuring strategy execution success is building strategy into as many business processes as possible. Typical opportunities include the budgeting, reward and recognition, communication, compensation, and people performance management processes. Successful organizations know that building strategy into as many business processes as possible makes it more visible to their organization and enables higher levels of organizational alignment (which is critical to ensuring the achievement of their organizational strategy).
The most critical point here though is that, to maximize the returns on your OPM investment, every critical success factor on this list MUST be in place – if even one is missing or if any of these factors aren’t firing on all cylinders, the result will be sub-optimized OPM results. Unfortunately, this fact rarely gets discussed with/by executives before they jump on the OPM band-wagon and that’s too bad because a lack of understanding of what they and the organization really have to do to achieve success is the #1 reason, in my experience, why business leaders end up disappointed with the results achieved through OPM.
If your organization is considering starting on an OPM journey OR if your OPM journey is currently producing under-whelming results, I’d encourage you to review the list above and then answer these questions:
What aren’t you prepared to commit to/haven’t you committed to?
What items have you missed? Why?
What is your organization prepared to actually do to close these gaps? Why or why not? (What’s getting in the way of making the required commitment?)
In my experience, your answers to these questions will have a direct bearing on the business success you can realistically achieve through your organization’s OPM efforts.