Tag Archives: Metrics

How Do You Improve Performance Reviews? Three Approaches

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Situation: A CEO’s company sets objectives for employees; however these objectives frequently aren’t met. There are lots of excuses for not meeting objectives. Most frustrating, employees are eager to share good news, but hide bad news and performance issues. What have other CEOs done to prevent these problems? How do you improve performance reviews?
Advice from the CEOs:
• A service company instituted frequent measurement of performance against objectives. Top staff monitors key metrics in weekly meetings that last at most one hour. They use a problem solving approach to address obstacles and to correct performance. The CEO oversees the direction with staff making and instituting changes to correct low performance. The key is in the metrics. Metrics must measure meaningful performance and must be tied directly to company objectives.
• A light manufacturing company had a history of holding on to non-performing individuals for too long. The CEO addressed this by instituting objectives and eliminating non-performers. The result was reduced complacency and improved morale. Performing employees had been tired of taking up the slack for non-performers. Document non-performance and establish a solid case for eliminating the non-performing employee. Documentation is critical to avoiding wrongful termination suits.
• A general observation: if a company has objectives, but lacks either meaningful metrics to measure performance against objectives or a regular review process to assess performance against objectives, then the objectives are meaningless. The CEOs’ experience is that establishing meaningful SMART (Specific, Measurable, Appropriate, Realistic, Time-Bound) objectives and regularly assessing performance in a collaborative team atmosphere are the most important ingredients to an effective performance management system.

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How Do You Accelerate the Progress of a New Sales Person? Four Pieces of Advice

Situation: A CEO recently hired a new sales person. To date, this individual has signed some good customers, but is struggling to generated sales. How patient should the CEO be with this person? How much time should be allowed to demonstrate performance? What metrics do others use to assess and incentivize sales performance?
Advice from the CEOs:
• Set 90 day targets that you expect for the individual to reach: X new accounts, Y in sales revenue, other measures as appropriate to your business. Set these targets WITH the individual, not FOR them so that the individual has ownership of the targets. Monitor the individual’s progress frequently. If the trend is below the target, ask what the individual plans to do to meet or exceed the target. Targets are best set at the time of hiring. If the individual cannot approach these numbers then it’s better to cut sooner rather than later.
• How do you differentiate the sales person from the sales talker? Set firm targets and expect to see results quickly.
• The traits that correlate with success are not traits that that salespeople develop after they are hired. They have to demonstrate these from the beginning. The hiring process must select for these traits.
• There are a number of companies that offering tool that will help identify whether candidates for a sales position possess the traits that your company deems most important. Among these is TTI – Target Training International – www.ttisi.com and Sandler Sales – www.sandler.com.

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What are Attributes of a Highly Effective Sales Force? Three Points

Situation: A CEO wants to improve the effectiveness of her sales team. As CEO of a young company she faces a choice between using contract versus direct sales reps. She seeks the advice of other CEOs as to what has worked most effectively with their sales approaches and teams. What are the attributes of a highly effective sales force?

Advice from the CEOs:

  • Spend time vetting either contract or your own sales reps:
    • The choice of contract vs. direct sales reps is driven by market conditions and end desires.
    • Utilizing a contract rep is an effective way to gain entrée into the customer. Even though they are 1099s, they must be managed as though they were company employees.
    • It is important to spend considerable time vetting candidates for direct sales. Attitude, desire and commitment are much more important than experience and technical prowess. Spend as much time as necessary to make sure that you are hiring the best people. Test them, check references from employers and customers alike. Leave no stone unturned.
  • Measure:
    • What gets measured get done. Determine what behaviors are necessary for success and develop metrics for these behaviors. This enables you to manage success.
    • For one CEO, the biggest challenge is selling above the gap – selling high and wide within the customer organization. Most reps concentrate their efforts on a few people in the client organization – generally low and mid-level people – and fail to establish relationships with senior management.
    • It is important, and rare, to have those senior relationships. Getting them requires deep understanding of the customer’s business combined with confidence, determination and persistence.
  • Respect and manage reps:
    • Many companies treat sales as a “necessary evil,” setting up an antagonistic and ineffective relationship between sales and other departments. This causes the salespeople to hide much of their information or spend time “scamming the system” rather than working as part of the team.
    • The best companies treat sales as a revenue engine and encourage, value and respect input from the salespeople. This encourages sales to be part of the larger team.
    • There can be challenges transitioning people from a pure product sale to a long term service business relationship – a transition from Hunter and Farmer. Most believe that these are two very different personalities. It may be better having hunters who bring in the business and then transition the customer relationship to account managers to maintain long-term relationships.
    • It may be necessary to design two compensation plans to incentivize the desired behavior of each group.

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How Do You Shift from an Operational to a Strategic Focus? Three Points

Situation: A CEO is concerned that her company is too focused on day-to-day operations with much less focus on strategic objectives and initiatives. She estimates that the company is 75% day to day vs. 25% strategic. What is the best way to shift the focus, and over what timeframe? How do you shift from an operational to a strategic focus?

Advice from the CEOs:

  • Look at the current mix between day-to-day and strategic activity, set a timeframe for the shift and set interim objectives.
    • For example, if the current mix is perceived as 75% DTD / 25% Strategic, set monthly objectives to move first to 50% / 50% and eventually 25 DTD / 75% Strategic.
  • While the objective is to move the CEO’s and company’s activity more in the strategic direction, it is necessary to assure that the day-to-day bases are being covered.
    • Select a key member of the team to take on this responsibility and train that individual to assure that the day-to-day operations are covered as the company makes this transition. This will be a bonus for the individual selected and will help to deepen the organizations talent pool.
  • During weekly meetings push the discussion more toward the strategic direction.
    • How can the metrics and operational reports be automated and readily available to team members so that less time is spent on this during weekly meetings? Consider an executive dashboard – developed by the CEO and key staff but maintained and updated by staff.
    • This will help to build confidence that the team is able to monitor the business and should reduce the time spent understanding operations. This will allow the team to focus more on strategic vision and plans.
    • This is also important to the company’s ability to monitor operations in its remote locations as these are set up.

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Is Burning the Candle at Both Ends Doing Harm or Creating the Legend? Four Points

Situation: A CEO fills nearly every minute of the day with activity. All are meaningful, and he enjoys the contribution that is made to each. Many activities involve his children and activities important to members of his family. However, because he asks the question there is something that is nagging at him. Is burning the candle at both ends doing harm or creating the legend?

Advice from the CEOs:

  • The priority is a positive, healthy lifestyle. Two answers to the group’s questions are in conflict with this.
    • Four to five hours of sleep at night is not enough to sustain the current level of activity.
    • Medical studies indicate that while some people can get along on 6 hours of sleep per night, most need 7-8. Those who get less than 6 hours on a regular basis are taxing their bodies as well as their psyches
  • What does your family think? Are there messages or hints indicating that too much is being taken on or that there isn’t enough time for them. If so, there may be too much on your plate.
    • The one person who does not seem to fit into the lifestyle described is your spouse. This individual needs attention – on a regular basis, not on a once-per-week evening out. Comments about too much activity are more likely a request for more quality time.
    • Given the importance of this relationship, not just currently but looking out 10-20 years, this indicates a need to reallocate proprieties.
  • Do what makes you happy. Each of us is the only person who can really monitor our activities, so each of us must set the metrics.
  • Create some monitors to assure that you are not over committing and that you are giving sufficient time to rest and your wife. After all, this is a marathon. It makes no sense to burn out in the first mile!

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How Do You Shift a Key Employee to Manager? – Pt 2 Three Points

Situation: A CEO wants to promote a key employee from rainmaker to manager. This will not involve a change in expectations or metrics for either the new manager or the employees who will report to her. However, there needs to be more forcefulness and clarity on what needs to be accomplished, both for the new manager and her team. How do you shift a key employee from rainmaker to manager?

Advice from the CEOs:

  • Don’t just measure calls. Measure the outcome from calls. Develop an objective and a metric or set of metrics that they can run to. Link their activity to business results. They will respond because they will be able to impact the firm as well as their careers.
    • Tie individuals’ metrics to the business culture that the management team is creating and create win-win links.
  • What is involved in changing the business focus to new markets?
    • Build a replicable system for servicing a particular channel. Use the lessons from this exercise to build systems for new channels. As the team moves into new channels, tweak the replicable system so that it responds to the specific demands of that channel.
    • For new channels, identify the most important needs of the new customer – from their perspective – and develop a client service model to meet this need. For example, if the goal is to develop an investment service for foundations and endowments, the key variables may be acceptable return with a high degree of safety. Tailor an investment portfolio, as well as a client service strategy to meet the most important needs of this sector.
  • What is involved in creating a smooth hand-off within client relationships?
    • Start bringing in others to whom will be handed off the relationship as early in the client relationship development process as possible. Allow rapport and trust to develop, and prep the client for the expectation that a smooth hand-off is part of the ongoing client relationship.

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How Do You Shift a Key Employee to Manager? – Pt 1 Four Points

Situation: A CEO wants to promote a key employee from rainmaker to manager. This will not involve a change in expectations or metrics for either the new manager or the employees who will report to her. However, there needs to be more forcefulness and clarity on what needs to be accomplished, both for the new manager and her team. How do you shift a key employee from rainmaker to manager?

Advice from the CEOs:

  • Renegotiate expectations of the two employees who will now report to the new manager. This doesn’t change the team goal, but will give all members of the new team measurable objectives that will enable them to contribute. An example of a measurable and achievable objective may be leads generated for them to close.
  • Don’t just measure activity – measure the outcomes that the team’s activities produce. For the new manager, create a 90-day plan with specific, SMART objectives, as well as a training schedule that will bring her up to speed with the full organization so that she sees how the pieces fit together and has the opportunity to contribute as she sees opportunity.
  • Think about the full process through which the vision will be translated to reality:
    • Vision →
    • Plan →
    • Standards of Performance →
    • Objectives →
    • Evaluate and Monitor
    • With multiple feedback loops between these components
  • The key to business development or sales is relationships. Much of the technical aspect of any sale amount to learning the lingo that is involved with the sale.
    • Look at what members of the team can do to build relationships with potential clients.
    • Support them with technical support and teach them about the technical aspects of the business along the way – for example through lunch seminars.
    • The new manager will act as the closer for relationships that the team nurtures and brings to the firm.

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How Will Your Personal Plans Impact the Company? Six Points

Situation: A CEO, for personal reasons, is planning to move to another state. While he will remain CEO, he is concerned about the potential impact of this decision on the company, particularly the fact that he will not be present personally to handle matters that arise. What can he do to alleviate this concern? How will your personal plans impact the company?

Advice from the CEOs:

  • Put a stake in the ground. Set a date for the move and work backwards to see whether this is attainable.
  • Have a discussion with the company’s key managers.
    • Empower them to challenge the date.
    • Discuss this as a brainstorm to plan the future and what must be done to get there. Once a plan is established retest the timing.
  • Consider this as a gradual transition. Start 3 weeks here / 1 week there, and gradually transition to 1/3. This will help you to determine how the company performs absent the CEO’s daily presence.
    • Move family but keep a small place here. Start the transition now and figure out balance. Do what is necessary.
  • Have the key managers transition their roles before initiating the move.
    • This will provide confidence that they can handle this transition.
  • As part of the process, look at areas where the company can use more support. For example, is HR up to snuff? What about information services or financial management? Prior to initiating the transition take steps to fill any gaps.
  • Does the company have a formal metrics structure?
    • If not, establish one and in preparation for the transition see how the two managers manage this.

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How Do You Shift the Sales Mix? Five Suggestions

Situation: The CEO of a professional services company wants to shift the focus of the company from emphasis on service of existing customers to new customer development. Historically they have counted on repeat sales, but these have lagged. The CEO wants to develop new customers to build current and future revenue. This is a mentality shift. How do you shift the sales mix?

Advice from the CEOs:

  • The objective is to move the current customer to new customer mix from 80/20 toward 40/60.
    • As an example, the CEO has shifted her focus day to day management to long-term planning and strategy over the last two years.
    • Now it’s time to motivate others to make a similar shift in customer development.
  • Make the shift to sales – to rain-maker – a requirement for Partner Track. Let those who want to pursue Partner Track know that this is a key part of their qualification for Partner.
  • Make cash flow analysis an integral part of new project proposals and current project tracking. Have project managers devise their project analyses to show return but review these to assure that their analyses are accurate. Require them to sell their analyses to the Partners. This will help them to see the value of correctly bidding new projects up-front.
  • Ask them – what do you want to be doing in 10 years? How will you be contributing to the goals of the firm? What are you doing to get there? Communicate the critical metrics that will be evaluated: sales, new account development, profitable bids and project cost control. Focus cost control on keeping options presented under control and minimizing rework.
  • Reserve Partner Track for those who can produce both sales and effective delivery of services. In employee reviews make this distinction clear.

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How Do You Recruit and Retain the Best People? Three Suggestions

Situation: A company is losing employees. Not the top ones, but the 2nd level. It’s not a manner of money but other reasons. Some don’t like the developing culture of accountability. Others are younger high potential employees who have performed well but have left for unexplained reasons. How do you recruit and retain the best people?

Advice from the CEOs:

  • It’s important to learn why they are leaving.
    • It may be a millennial phenomenon – this group may regard work as a transitory necessity.
    • Determine whether it because of accountability or other reasons.
      • Could they be unhappy with the level of growth opportunity?
      • Previous generations were used to moving to move up – are the younger employees less prone to do this?
    • Could younger workers see work as a job, whereas previous generations saw work as their livelihood – as their life.
  • What options could be tried?
    • Set up a hiring plan – over-hire to assure availability of talent – 15 people in the next 3 months.
    • During the hiring process employ a focused interview diagnostic to identify the key factors that will boost in employee retention.
  • One CEO has suggested an approach:
    • Start with a volunteer employee focus group that holds a series of meetings over lunch.
    • Use company channels to ask for volunteers.
    • Allow the group to relax and open-up over time. Then begin to drill down to the real issues, including legacy issues.
    • Use feedback from the focus group meetings to design a survey to establish metrics, validate the findings of the focus group, and establish benchmarks for long-term attitude monitoring.

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