trans_m AG

Management of Change and Development Leadership – Performance – Customer Focus

news October 2008

2 Performance Effective HR Development 3 Performance and Customer Focus Interview 4 On-line Tool Performance Fitness Indicator

Performance Are You a Performance-driven Organisation?

Records tend to draw attention only for a limited period of time, no matter whether we’re talking about high-profile business deals or top-notch results in sport. Records put the limelight on an athlete or a team, and the same goes for corporate success. Often, a CEO gets all the attention for leading the company to success. By analogy, all the blame will be on the „superstar” in case of failure, resulting in the dethroning of, for example, the former number one in tennis, a team of cyclists disqualified from the Tour de France or the CEO of a bank.

Against this background, let me ask a few questions: Are records indicative of a performance-driven organisation? Is it essential to focus on a fundamental objective in order to achieve sustainable performance?

managers in a position, and do they have the commitment, to actually make effective use of the tools available (e.g. performance appraisal and review, customer and staff satisfaction surveys, etc.), and to implement the measures resulting from them? Do you have appropriate structures of organisation, key processes, support, etc.?

Performance is not simply expressed in bare figures, nor is it just a matter of conditions of work, pay, or the rate of attrition. There is more than that to performance: it is based on values, identification, motivation and commitment by each and everyone, within teams and, indeed, throughout the organisation.

Use our short web-based test to find out how your company is doing with regard to performance.

A genuine performance culture will pay off in the long run. It will add to customer satisfaction and HR development inside your organisation, optimize your processes, and produce a return in the form of enhanced results. If your conclusion is that your company needs to take some action, we will be more than pleased to coach you in becoming a truly performance-driven organisation.

Are you a performance-driven organisation? How do you measure the success of your corporate efforts? Are you happy meeting or surpassing your revenue and EBIT targets on a regular basis? Or does your system of evaluation include other factors such as the ones the Balanced Scorecard measures? To what extent is your corporate controlling capable of assessing soft factors on top of Rolf Erny, MBA hard facts? Do you monitor, on a regular basis and Managing Director at the various levels of your hierarchy, how much r.erny@transm.ch your goal performance is in agreement with your strategy? Do you measure your HR development in terms of contribution to corporate success rather than the number of training days? Are your

trans_m AG Querstrasse 4 CH-8304 Wallisellen E-mail office@transm.ch

Editor’s Comment Performance is a fundamental concern for every executive.

Performance means more than to reach financial targets; it also includes client relations as well as HR and process development. To measure performance, companies often rely on the Balanced Scorecard (BSC) developed by Kaplan/Norton.

Performance is one of our three core areas of activity (leadership, performance, customer focus), and we measure it by means of Kaplan/Norton’s BSC, too. It takes consistent and sustainable management of both hard and soft factors to achieve, maintain and further develop high performance. It is essential to address all aspects of corporate management with determination and commitment.

It is by consciously and actively creating a culture based on performance that you will activate staff, executives, teams and, indeed, the entire organisation. This will produce a sustainable increase in performance.

We can support you in combining hard and soft factors consistently and effectively.

Working with you and your management team, we will boost your company’s capabilities, making your organisation one driven by performance. Your benefit will be a genuine „return on consulting”.

Yours truly, Rolf Erny

Newsletter October 2008

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Performance Effective HR Development Quality at trans_m AG As a consultancy, trans_m is particularly committed to quality. It is only through the quality of our services and processes and the skills of our staff that we are able to satisfy the highest of demands.

See for yourselves which criteria and standards our work is based on: • SQS certificate: management and services processes • DIN 33430: standards for aptitude assessment and persons assessing aptitude • Arbeitskreis Assessment Center: standards for assessment-centre technique and coaching • Association of Career Firms: standards for career counselling

To develop skills in staff and executives is a fundamental management task. There are four essential requirements for measures to be effective.

First of all, the „HR development” function is key.

While this may sound trite, it is far from being standard in all companies. You do not actually need a large HR-development department. It will be sufficient to make an individual or some unit responsible for it. Where there’s no consistent HR development, there will be no expansion of skills, which is an omission with serious implications considering that standstill means regression.

Secondly, HR development is to include implementation of specific measures to increase performance based on the company’s strategic objectives and guidelines. This holds true for individuals as much as for teams, entire units, or the controlling function. The only way to effectively promote the capabilities of staff and executives for the benefit of the company is to link up HR development with corporate objectives in a controlled manner. It is therefore essential to interconnect and control all activities and measures in HR development.

Thirdly, it is to bear in mind that only a development process structured across the entire organisation will have the force of a real performance engine. Scientific studies have shown that continuous and timely feedback is the biggest driver of performance. Most structured feedback systems involve two development appraisals per annum.

The quality of these appraisals depends on how well superiors are trained in these systems and how much staff trust in the systems. This means that feedback systems become truly effective and produce the desired benefits only if decent training is provided and the systems are launched in a manner encouraging their users.

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trans_m AG Querstrasse 4 CH-8304 Wallisellen E-mail office@transm.ch

Fourthly, consistent and comprehensive measurement of increases in performance is the only means to record the effect of change initiatives.

It is an important component of effective feedback. It is not easy to achieve measurability, but it is possible, and it is the only way to appraise the success of measures.

Objectives and personal performance targets are defined by the business lines whereas HR development is responsible for developing skills and making them available. External partners may be hired to provide specific services or more comprehensive development programmes.

Simon C. Hardegger, MSc, Psychologist and Adult Educator Head of the Professional Service Center s.hardegger@transm.ch

Newsletter October 2008

Performance and Customer Focus „All you can measure is performance”

Peter Drucker

When the concept of performance is used in relation to customers, it is usually a measure for the difference between expected revenue and services actually billed. The smaller the difference, the higher the reward for the Key Account Manager or the Sales Manager.

used to have? Do we enquire about the experience they had with us, or do we simply refer to products? Do we measure the recommendation ratio, the reselling potential, the shift of market share?

Do we really ask ourselves how we can manage to improve?

However, here is what customers measure our performance by: Are we simply trying, or do we really come up with top performance every time?

How do customers rate our potential? Do we really meet their expectations? In the buyers’ market today, the road from preferred to C-class supplier is short and usually one of no return.

The biggest potential for performance improvement in many companies trans_m has worked with lies in the area of corporate culture, which means in staff at all levels. Important measures to enhance customer focus and thus contribute to corporate success include clear objectives and measurement of behaviour inside the organisation and in client relations as well as effective training and coaching of individuals and teams designed to bring about sustainable change of behaviour. While it is expensive and difficult for companies to set themselves apart on the basis of products or services, differentiation through behaviour and corporate culture is sustainable and almost impossible to copy. We will assist you in your efforts.

Our corporate performance is reflected in the customer’s perception, which is driven by three factors, i.e. product, brand and points of interaction (see trans_m news June 2008). We have production certified and advertise our quality claim; we have an excellent team for corporate communication; but where’s the money invested in customers and measurement of customer focus, and where’s the customer experience? Is it sufficient to do a cus- Gerhard Romanescu, tomer survey every other year? Do we contact the Certified Sales Manager, Sales Director customers we have, or do we dare ask the ones we g.romanescu@transm.ch

Interview Performance at PricewaterhouseCoopers

Gerhard Romanescu interviewing Stephan Peterhans, Head of Human Capital, PricewaterhouseCoopers (PwC) Switzerland

Mr Peterhans, high-performance culture is a buzzword used very frequently. What does it mean to you?

I understand it to describe a culture that facilitates and promotes performance. A company’s culture is primarily driven by the behaviour of management. In addition, strategic and structural requirements need to be met for a performancedriven culture to arise. For example, an aggressive growth strategy is probably rather difficult to implement when decision-making paths are long, hierarchies rigid and salary brackets inflexible.

How does PwC convert a best-practice performance culture into one of everyday practice?

Actually, I’m not particularly fond of these buzz­ words. I think the key question is how to make culture felt in day-to-day life. To this end, we have launched a number of customer and staff projects aimed at change of behaviour.

How long do you expect the process of change to last?

The projects have been launched for a maximum period of three years.

How does PwC measure success and ensure sustainability?

We measure customer and staff satisfaction. Then we combine these qualitative factors with hard financial figures to produce a good tool for control and navigation. To ensure sustainability, we develop a joint understanding of performance, derive from it individual targets, and align with it our salary and bonus system.

trans_m AG Querstrasse 4 CH-8304 Wallisellen E-mail office@transm.ch

Stephan Peterhans Head of Human Capital PricewaterhouseCoopers www.pwc.com

Newsletter October 2008

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Performance Do Performance Measures Pay off?

On-line Tool Performance Fitness Indicator How fit is your company when it comes to performance? Performance is driven by various factors to different degrees (read and compare the articles in the present Newsletter). A brief survey will give you a first impression of how fit your organisation really is.

Go to our website and click the Performance Fitness Indicator link. www.transm.ch/survey

New Website On-line Our revamped website is on-line now: it’s modern, easy to use, appealing and full of information.

Learn more about trans_m, our core areas of activity (leadership, performance, customer focus), and our services at www.transm.ch

Is it worthwhile investing in staff and executive development? Is it possible to measure how successful such initiatives are? Do they really pay off?

These are some of the questions that arise specifically with regard to the cost of training, mentoring/coaching, management audits, assessments, or a development centre. However, we must not forget the price we would have to pay for not investing in and for staff. Failure to invest may prompt staff to become disenchanted and to mentally or actually quit their jobs.

A genuine „return on development” is generated when an individual, a team or the entire organisation is successfully encouraged to boost ownership and commitment and to strengthen loyalty.

A consistently equipped corporate development cockpit is the only means to demonstrate whether a particular measure is worth its while and creates sustainable effect. In addition, a balanced scorecard may be used to visualize results.

What difference do development measures make?

When people are given an opportunity to tackle their own development, they will be more confident in their skills. When people are encouraged and given feedback mirroring their actions, they will be more willing to spontaneously go the infamous extra mile and to inspire others to take on even the most daunting challenges. If there is a willingness to develop, development measures will always pay off so long as they are adapted to the individuals and situations involved, and agreed upon, carried out and reviewed jointly.

This is a boost to identification with the company.

Suddenly, it will be a pleasure to complete assignments, no matter how difficult they may be; teams will tackle and settle issues with brio and real spirit; the general atmosphere will be more positive. It’s like a powerboat: once it’s in full gear with all the power converted into speed, it starts to glide above the water as if no effort was required.

It is only then, when the airstream hits your face, that the ride is real fun.

This will not remain unnoticed by the outside world. Colleagues, friends and partners as well as existing and prospective customers will sense that the person, team or organisation is really enjoying what they’re doing. This will improve relationships and facilitate sustainable increases in performance.

In a nutshell, the result is more than just a return on development.

Development prompts people to take action spontaneously. The energy invested produces a notice- Rolf Erny, MBA ably enhanced return with its positive impact on Managing Director the persons involved and the setting they work in. r.erny@transm.ch

trans_m AG Querstrasse 4 CH-8304 Wallisellen Switzerland phone fax e-mail url 4

+41 43 233 32 13 +41 43 233 32 15 office@transm.ch www.transm.ch

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