This year we saw a whopping increase in our insurance premiums. It turns out our employees are using more health benefits for our small group than what was projected.It got me thinking to see if there is a way to create a healthier work force. It turns out that there is. People that exercise use less health benefits. But, one of the side effects of exercise, besides a healthier workforce, is that some studies show that employees are 20% more productive when they exercise.If we reduced our work day from eight hours to 6.4 hours, required one and a quarter hours of exercise, would we save money with reduced healthcare costs, and get the same work done? Something about the math feels funny, but we might have happier employees. It’s an idea where I like the concept.
Archive for March, 2010
The way I like to think about performance management is identifying the driver of the business and aligning performance goals around that driver. For example, on HubPages.com the driver of the business is quality Hubs (Hubs are similar to articles). Once a performance metric is set, people should optimize their work around the performance metric. This is where common sense comes in. You have to take a performance metric and couple it with good judgment. If someone developed a script to create thousands of hubs, we would hit the goal, but the quality would be off. So, constraints need to be put in place.
So for marketing, they have a performance goal of Hubs. Those hubs have to be of a certain quality level, acquired at cost per acquisition price with an expected payback period within a specified time frame, and they must demonstrate good judgment with regards to the company (no gaming the system). Now, that the performance metric is set, startups often don’t have the history of data required to set accurate performance metrics and are often in a state of frequent change. When that happens, sometime performance metrics need to be paused and taken up to a higher level, or reset because a new major variable is understood, so you will need to be flexible.
Let’s say that the business isn’t working out and you’re going to have to pivot. The new decision point is going to be able to figure out if you have a business that is worth investing in before putting performance metrics in place. This is where the ultimate performance management is put in place. Will the company survive? Fail and everyone is out of a job. Succeed and refine performance objectives to drive the business.
Ever notice that one of the few things we buy in the metrics system in the United States is the two liter bottle of Pepsi and Coke. Remember when you were grade school and they taught you that it’s a better system, but we don’t use it in the US? I always thought, why? Unless you work in a lab, you probably have little idea how far a kilometer is compared to a mile, or the volume of a litre compared to a quart. Now, I don’t remember exactly why we don’t use the metric system, but it stuck with me that it’s a better system.What strikes me is that two of the most powerful marketing machines sell the best known metric system based product. I bet they could persuade the US to switch. What if they completely switched to the metric system for all their products? How long would take before middle america was well versed in the system? I bet it’s like a superbowl ad, a few spots on AI, and a couple of twelve packs.Pepsi is running a “Refresh Everything Campaign.” Maybe it’s time for Pepsi to refresh how we measure things in the US . To get us to switch to the metrics system because it’s better. Perhaps there is a marketing campaign in there. ”Switch, because it’s better.”
New Corvettes are fast, beautiful, and one of the best values for sports cars. Read a review of a 2010 Corvette and they’re pretty incredible. The men I talk with about sports cars have gotten the message. This isn’t the Burt Reynolds, hairy chested, gold chain wearing sports car that says - “You’re that guy.” Instead, it’s fast. Even faster than a Porsche Turbo. And. It’s about one third the price, which is much more practical. A combination sports car shoppers appreciate now.Corvette’s biggest problem is the brand. Tell your wife - like I did - that you want to checkout Corvettes and you’ll get that look. Do you want to be that guy? That guy. The one with the gold chains. Ha. Well. No. Not exactly. But, it’s the exact problem that Corvette has. Corvette needs to rebrand - It needs to become the cool, practical sports car, that speaks beyond power and speed to style, comfort and practicality to women. Once women no longer see Corvette as the trademark of “That guy” then Corvettes won’t have to be thirty years old to be thought of as cool.
While I won’t do this scenario justice, I thought this was one of the more challenging management issues I’ve seen lately.
A 20 year employee of a major company has risen to a senior sales role. Two thirds of their territory are performing above plan, and one third below. The one third below is pulling the entire sales organization below plan. The territories that are under performing don’t have any special market challenges - It’s a management issue. The senior sales exec has been ineffective at helping the under performing team. The senior sales exec has 20 years of positive reviews and HR won’t support firing them. The senior sales exec is also well like by their employees and is seen as a positive force in the organization. But, the overall market is growing over 10% and the executives are putting pressure on you to fix the problem.
Big companies can be highly political and even though an employee can be strong in many facets of management, it’s not uncommon for one or two major weaknesses to be present. My take is that since there are strong performing teams that the problem is isolated to a few regional managers. The senior execs weakness is poor performance management. It may be because they’ve worked with the people a long time and feel loyalty to them or because they can’t deliver a tough message. Either way, the senior exec needs help. I suggested two things. One, taking one of the good performing managers and expanding their territory to include one of the poor performing territories. Second, removing the poor management, and hiring a replacement. If the senior exec resisted the help, to place them in another job since you’re unable to fire them.
How would you handle it?
