External Forces are ExertingPressure

Political

• Copyright legislation

• European Commission

Economic

• Internet a sales platform

• Piracy on the increase

Back To The Future

With Performance Management

Reinventing Management

Conference

Midrand Conference Centre

20 May 2010

3 Moonshots for the future

1. Reinvent the means of control

2. Expand the scope of employee autonomy

3. Develop holistic performance measures

1. Reinvent the means of

control

• Transcend the discipline-versus-freedom

tradeoff

• Control from within/ constraints from without

2. Expand the scope of

employee autonomy

Management systems redesigned

• Grass roots initiatives

• Local experimentation

The question is

How do we hand over control

and increase employee autonomy

and get the results we want?

“The manager should be controlled by the objectives of performance rather than from above.

The greatest advantage of management by objectives is perhaps that it makes it possible for a manager to control his/her own performance.

Self control means greater motivation”

Peter Drucker’s philosophy

of self control

“Man is a goal-seeking animal.

His life only has meaning

if he is reaching out and

striving for goals.”

Aristotle

Goals

Goal !

Self

Fulfilment

Esteem

Belonging

Safety

Air, water, food, shelter,

sleep

Maslow’s Hierachy of Needs

Maslow

One more time….

How do you motivate employees?

50

40

30

20

10

0

Achievement

Recognition

Work Itself

Fredrick Herzberg

“ People who achieve good results feel

better about themselves”

Keneth Blanchard

So if we take these concepts

• Provide our people with goals / targets

• Allow them to achieve with control from

within

• Recognise performance

Results

• A more motivated workforce

But . . . What if they don’t

achieve target?

• Action plans which facilitate grass roots

initiatives

• Result > Empowered workforce

Keeping score

arouses a strong desire

to improve.

Dr Arnold Mol

15

And it can get better

Inputs Outputs

Activities

Measure Here

How does a Performance

Management System put this into

practice?

• Measures become goals

• Goals are powerful motivators

Monitoring performance is

critical

• Review scorecards

• Analyse results

• Problem solving

• Action plans

• Recognition & reward

• Visual Factories

Therefore we have shown that a

Performance Management

System can . . .

• Encourage control from within >

Moonshot 1

• Facilitate grass roots solutions/ innovation >Moonshot 2

3. Develop holistic

performance measures

• Existing methods must be relearnt

• Inadequate attention to critical human

capabilities

• Drive success in creative economy

For too long we

have looked at

the bottom line

Perspectives Objectives MeasuresAction

Plans

Financial

Customer

Internal

Processes

Learning &

Growth

The Balanced Scorecard

Peter Drucker also said

measures had to be holistic

• Marketing

• Innovation

• Human organisation

• Financial resources

• Physical resources

• Productivity

• Social responsibility

• Profit requirements

Measuring human capabilities

• # Training days / employee

• % PDPs in place

• % Employees promotable to next level

• Employee Satisfaction Index %

But also their capabilities in

adding value

• % Deliveries on time

• Unplanned downtime

• # Stockouts per period

• # Customers won/ lost

25

Case

Studies

• Cement cartel under pressure

• Marketing warfare had begun

• Turnover R700 million Assets R2 billion

• Last on strategic indicators

From To

• Vehicle turnaround

times 2 hrs 20 mins

• Sales – distribution

channels 32% 65%

• Product quality

• Std Dev. > 2 > 1

• Brand awareness 3 1

• New products 4 6

Performance Indicators

• Led industry on all strategic indicators

• Market share + 2.5%

• Operating income + R20 million p.a.

• Marketing awards

Results Flowed Through To

The Bottom Line

N Y P D • Only measure was # arrests

• Where in the City

• When – time

• How – type

Results

• Crime down 65%

• Murder down 70 %

• NY voted safest big city in USA by FBI

Conclusion

• Reinventing Management contains some principles, or moonshots, that have stood the test of time

• They can and do work

• The real challenge is to acknowledge them, and implement them more effectively.

External Forces are ExertingPressure

Political

• Copyright legislation

• European Commission

Economic

• Internet a sales platform

• Piracy on the increase

Thank you . . . . .

are there any questions?

Visit us on www.manage.co.za