When measurement data show that a departments performance is meeting expectations What action should the manager take?

In the same way that you can’t fly an airplane with just one instrument gauge, you can’t manage a company with just one kind of performance measure. Think of a balanced scorecard as the instrument panel in the cockpit of an airplane. It’s a set of interrelated gauges that links seemingly disparate information about a company’s finances and operations. Together, they give you a more complete view of how your company has been performing, as well as where it’s headed.

A balanced scorecard asks you to think of your company’s mission and strategy from four key perspectives:

1. How do customers see us?

2. What internal processes must we excel at?

3. How can we continue to improve and create value?

4. How do we look to shareholders?

Next, identify the handful of measures that are most critical to your company’s success in each of the four perspectives. Tracking all the important measures at once guards against suboptimization—that is, achieving gains in one area at the expense of another.

The Idea in Practice

What you measure is what you get: the measures you use strongly affect the behavior of your managers and employees. When building a balanced scorecard, tailor the measures to fit your company’s particular challenges. That way, you’ll be more likely to get the performance you need to succeed.

1. Customer perspective. Today’s typical corporate mission says something general about customers. The balanced scorecard requires specific measures of what customers get—in terms of time, quality, performance and service, and cost.

2. Internal business perspective. Focus on the core competencies, processes, decisions, and actions that have the greatest impact on customer satisfaction. ECI developed operational measures for submicron technology capability, manufacturing excellence, design productivity, and new product introduction. Company managers then made sure to “decompose” the measures to department and workstation levels, where much of the action took place.

3. Innovation and learning perspective. Measures in this area indicate future success. They measure continual improvements to existing products and processes and introduction of new products with expanded capabilities. Milliken & Co. implemented a “ten-four” improvement program, requiring reductions in key adverse measures (defects, missed deliveries, and scrap) by a factor of ten over four years.

4. Financial perspective. Financial measures are essential for indicating whether executives have correctly identified and constructed their measures in the three foregoing areas—but they can also help determine future direction. For example, a chemical company created a daily financial statement. Putting income and expense values on every production process helped plant supervisors see where process improvements and capital investments could generate the highest returns. Example: 

A semiconductor company that the authors call Electronic Circuits Inc. (ECI) established the goal of becoming customers’ supplier of choice. To track this goal, the company conducted customer surveys, which revealed that each customer had a different definition of what constituted reliable and responsive supply. As a result, ECI discovered that it was not satisfying some customers and overachieving the expectations of others.

Next, you need to take the findings from the evaluation and create an improvement plan which works to fill any opportunities or areas of development that have been presented.

9 effective steps to improve employee performance

1. Investigate why the employee isn’t meeting expectations

The list of reasons why an employee isn’t performing as expected can be endless. If you don’t get to the bottom of these, it’s almost impossible to take the right steps to improve it.

Start with an open and frank discussion and find out if the employee feels anything is affecting their ability to perform. It could be that they feel the business is holding them back from reaching their full potential, they could be lacking resources, don’t feel aligned with company goals or aren’t receiving the proper guidance or training.

It’s also possible that factors affecting work may be unrelated to work itself. Personal reasons such as an employee may be going through a time of poor mental wellbeing or experiencing issues in their personal life can also impact performance.

This conversation can provide a basis for you to give more effective support.

2. Discuss both the highs and lows

Performance reviews shouldn’t just be focused on what’s not going well – even though improvement is your end goal.

Focusing just on areas for improvement could knock your employees’ confidence and could lead to resentment if they feel that their hard work in other areas is going unnoticed. Be sure to let your employees know what they’re doing well and point out any stand-out moments in performance since their last review, as well as the areas for development.

When you recognise their hard work, employees will know that they’re a valued member of the team and will continue to put this effort into their work. Nevertheless, when you do discuss challenges and areas for development, you have to be clear about any problems. The easy road would be to ‘soften the blow’, but by not being clear on what the problem is exactly, you’ll make any problems worse in the long term and the relationship could become more hostile.

Make sure that the employee leaves the conversation with a clear understanding of their strengths, any areas for development and the steps that should be taken to get there, as this will minimise stress. When delivering feedback you must always consider your employee's wellbeing. It's a good idea to check you're not giving them too much to do. Or, that they feel out of their depth.

3. Provide consistent feedback as they progress

The most efficient way to improve employee performance is to provide regular feedback. By frequently feeding back, you can help employees stay on track as they work to improve, rather than any issues being saved for a more formal review. By then, the effects of poor performance may have been detrimental to the team or business.

Frequent feedback helps employees to become more comfortable with receiving feedback in general. It can also stop any negative connotations that people associate with receiving feedback. That’s because frequent feedback is more likely to be a mix of positive and constructive comments, which can help to keep employees engaged and encouraged rather than disheartened.

It's important for performance improvement that employees know where they stand and how they’re progressing. They’ll then be more aware of how they’re doing and what steps need to be taken to improve further. Putting this information into a performance improvement plan can help both of you.

4. Create a positive workplace culture

A positive workplace culture helps to pave the way for higher engagement, greater motivation and better performance.

Review elements such as how aligned employees are with the company vision and mission, the employee benefits offered and how the business operates – for example, the work environment and elements like flexibility or holiday policies.

The workplace culture should give employees the stage to perform to the best of their abilities. A strong, high-performance workplace culture allows employees to be focused and engaged without any negativities distracting them and with the support of a positive workplace to drive them forward.

The most simple way to find out if your workplace culture is right for your employees is to ask them! Use a confidential survey tool to ask your employees what they think about how your business operates. As this is a confidential platform, your employees will feel free to be honest about anything that they would like to see improved.

Not only can this help you to make changes to anything in the business that may be affecting performance, you can also show your employees that you value them by making changes based on their suggestions. This helps to make your people feel valued but also improve engagement levels.

5. Prioritise learning and development

Often, poor performance can be attributed to a skill or knowledge gap. By creating a focus on learning and development, employees are reminded of best practice, not to mention gaining new skills while taking valuable steps along their career path. 

Work with employees to create individual L&D plans as, when you give employees a say in how and what they learn, they stay engaged and it helps to bring extra motivation.

6. Set measurable and realistic goals

To help drive performance improvement, an employee needs to know what’s being measured. This way they can monitor their own performance and, in turn, work to improve this. If goals aren’t measurable, employees are left guessing about whether they’re improving and they might feel that their results are subjective to their manager’s opinions.

Secondly, goals must also be realistic. Of course, you want to aim big, but anything that feels too unachievable could overwhelm employees and add to burnout. On the other hand, goals that are too easy will not provide any motivation. Be sure to find the right balance right.

You also need to ensure that it’s clear when you expect these goals to be completed by. Set two dates, one to come back and see how things are progressing, and another for an expected completion date.

7. Regularly recognise great work and improvement

When you recognise and reward good work, you're letting employees know that their effort is noticed. By creating a process which allows for regular recognition, you keep high performers engaged. Who then can lead by example and help others.

Our Celebration hub is a great way to make reward and recognition routine as it facilitates peer-to-peer recognition. In addition to making it easier for managers to send rewards to exceptional employees. You can learn more about Celebration hub in this quick introductory video.

One error that leaders often make is spending too much time focusing on under-performance and not on the wins their teams achieve every day. To keep your teams happy and productive you must show appreciation and not consistently criticise their work.

Reward and recognise your employees no matter where they are with Perkbox

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8. Maximise job satisfaction

Often, employees only want to put in what they’re getting out of a role. If they feel they aren't getting paid enough, aren't getting the benefits that they could be getting elsewhere, or feel like their workplace is lacking in resources - they may not try as hard to perform. Take a look at rival employers to ensure you are offering the right benefits to keep your staff happy, engaged and productive. For example, if rival employers are offering their London-based employees a London weighted wage, you should look into doing the same.

9. Act when you don’t see improvement

If you’ve worked with your employee to set clear goals, expectations and a plan for improvement, and they still aren’t working to make a change – you have to act on this.

If you don’t, employees will feel that it’s fine to underperform or have to be micromanaged. This is also demotivating for those who are performing well. As if they feel that poor performance receives no consequences, they’ll wonder why they are putting effort in.

Address the issue and lack of improvement with a written or verbal warning. By marking how important this issue really is with a warning, it can help employees to take more notice as they are shown the severity of the situation.

Even little things which are left to fester can become bigger issues and drive down performance. By monitoring development and acting on this, you’ll maintain a productive and performance-oriented workplace.