Connecting Performance and Retention

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Morgan was finally thinking about purpose. What was the purpose of the performance review in the first place? What was the performance review supposed to accomplish?

“Morgan, what is the most critical factor for both team member performance and team member retention?”

At this point, Morgan was gun-shy, he hesitated to respond.

“Let me ask this differently,” I continued. “What is the most critical relationship for both team member performance and team member retention?”

Morgan’s face relaxed. “That’s easy. It’s the relationship between the team member and the manager.”

“Good, now let’s build on that. How important is the conversation between the team member and the manager?”

“Pretty important, I guess,” said Morgan, going tentative on me again.

“Here is why it’s important. The relationship between the team member and the manager is the critical factor for both performance and retention. And the conversation is the relationship.”

What kinds of conversations are happening between your team members and your managers?
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Conversation is the relationship described in The Heart Aroused by David Whyte.

What is a 2?

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Morgan handed me a stack of the files which contained copies of previous performance reviews.

“I see here that you are using a 1-5 Likert scale with 1 = poor and 5 = exceeds expectations.” Morgan nodded. I continued, “Scanning down the list, I see that you have tons of 3s and only an occasional 2 or a 4, never a 1 or a 5.”

“That’s easy to understand,” said Morgan. “We don’t have to explain a score of 3. If we rate a 2 or a 4, we have to provide a written explanation. And even if someone deserves a 5, we never give it, because then they might ask for a raise.”

“And, tell me again, what is the purpose of this review?”

“Well, our HR person says that if we have to fire someone, we need to have a bunch of 1s and 2s in the file. Something about avoiding wrongful termination.”

“Morgan, have you ever been up against a plaintiff attorney in court?”

“Not really,” Morgan replied.

“Morgan, have you ever had to explain to an attorney exactly what a 2 means?”

“Not really.”

“Morgan, with all due respect, this little form is not going to get you very far in a wrongful termination suit. There has to be a better purpose for this performance review process.”

Learning Something New

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What stops us from learning?

It’s not the complexity of the content, or how much there is to learn. The obstacles to learning most often exist in the head of the learner. Obstacles are more about beliefs and assumptions than the details of what has to be learned.

We learn to delegate effectively, not by learning a new delegation model, but by ridding ourselves of the assumption, if you want it done right, do it yourself. We hold back on sharing problem solving, not because the team members lacks the skills, but because there is a lack of trust. We hold back on sharing decision making, not because the team member is unable to make the decision, but because we, as managers, have always made that judgment call.

What stops us from learning is often, something inside our own head.

Freedom and Responsibility

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Freedom and responsibility are linked.  Problems occur when they are decoupled.

In a strict rules-based environment, where all behavior is dictated and abnormal behavior punished, there is little need for individual responsibility. The rule-maker assumes the responsibility and the individual suffers the consequences, for better or worse.

With freedom comes responsibility. Where there are no rules, behavior becomes the responsibility of the individual.

In an effort to enforce attendance at work, organizations (in the US) introduced limits to sick days and vacation days. The individual no longer had responsibility in that matter, and freedom only within the limits of the policy.

Some organizations adopted policies of unlimited vacation days, sick days, personal time off days, shifting the entire responsibility of attendance to the individual. This works only if the individual assumes that responsibility and behaves accordingly. Problems occur when, given that freedom, individuals do not respond to that responsibility.

Freedom and responsibility are linked.

Expand that coupling to working from home, flex time and larger issues. Expand that coupling to social institutions and governments. Freedom can only exist in an environment of individual responsibility. It is in the absence of individual responsibility that freedom becomes limited, by rules, and authoritarian institutions. Happy Independence Day.

Trying to Shortcut the Work

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“So, let’s call her right now, offer her the position, straight away,” I suggested.

“But, you haven’t even read the profile,” Kristen protested. Even she could see the absurdity of making an offer before proper due diligence.

“I don’t need to read the profile,” I replied, pressing the absurdity.

“But if you don’t read the profile, how can you know if this person will be able to do the job?”

“Excellent question. How can we know if this person will be able to do the job if we don’t have a role description to help us read the profile?”

“Well, we have the job posting.”

“Kristen, I read the job posting. There is more on company benefits than there is on expectations. It appears to me that you are trying to shortcut the work required in this hiring process.”

“It’s not that I don’t want to do the work, I just don’t have the time. I have a lot of other important things I need to be doing,” Kristen insisted. “Writing a role description takes a lot of time, and I am sure HR has one that is pretty close.”

“It’s not that you don’t have the time. You have as much time as you need. It’s just not a high enough priority.”

Do We Really Have To?

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“Before I look at the personality profile, let’s take a look at this job posting and see if we can create a job description that will help us,” I insisted.

“Do we really have to?” Kristen pushed back. “You know, if we don’t make a decision quickly, I’m afraid this person might take another job. That’s why I asked you to come in this afternoon, to look at the profile assessment.”

“So, you would rather make a wrong decision this afternoon than a better decision tomorrow.”

Kristen was exasperated. “I don’t think we can wait until tomorrow. I told the candidate we would call her with a decision before the end of today.”

In a Hurry to Hire

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“Here it is,” Kristen announced. “I couldn’t find the job description, but here is the job posting that we put on the internet.”

“So, you don’t know if you have a job description?” I asked.

“You know, we were in such a hurry to get this posted, I don’t think we actually wrote a job description.”

“So, how will you evaluate the candidates who respond?”

“That’s why I asked you to look at the profile assessment. Everything is there. That’s why I think we have a good candidate,” Kristen curtly replied.

“Oh, really,” I mused.

“Yes, based on this personality profile, I think this is someone I could really work with.”

Work Moves Sideways – Release and Pace

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“It happened again,” Peter grimaced. “We just got a large order with a tight deadline. We went to expedite the order and turns out there are projects stuck in the middle of our system.”

“What do you mean stuck?” I asked.

“I mean stuck,” Peter replied. “We run a just-in-time shop. We don’t order materials until we have a project, and some of those materials have lead times, so we have a bit of coordination to do. If we have a material with a three day lead time that we can’t schedule that project for tomorrow.”

“So, what’s the problem?”

“Supply chain. We know we will have the material in three days, so we release the project to the floor so when it’s time for those materials, the materials are there. Until they’re not. We found out that material is out of stock from our supplier with a three week lead time, not three days. But the project is already on the floor. Without the material, the project is stuck. And, it’s big and heavy, stuck in a staging area waiting on material. We can’t move around it, we can’t move over it. It’s stuck. Now, we have a highly profitable project, lots of gross margin that we can’t start because the other project is stuck on the floor, for the next three weeks.”

“How often does this happen?” I wanted to know.

“With supply chain the way it is, more and more,” Peter shook his head.

“What have you learned so far, about what to do and what not to do?”

“Well, for one thing, never release a project to production until we have all the materials in hand. That will keep things from getting stuck. Also, a couple of workstations are very quick and sometimes get ahead of themselves, pushing out too many assemblies, stacking them in the way. The guys in that work cell are so proud of their output, they don’t see they create a problem. I think we may have to idle that process during portions of the day so things don’t stack up. Weird that I would have to tell that team not to work so hard.”

Work Moves Sideways – Output Capacity

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Every system has a output capacity over time. If a machining system requires twenty minutes to complete a process, it can produce no more than 24 units in an eight hour shift, and that’s if nothing goes wrong. If there are variations in the process that require setup time, the capacity moves down from 24 for each twenty minutes of setup time. If a tool, in the machine, gets dull, that twenty minute process might increase to 23 minutes and reduce the output capacity.

Sales may have no similar constraint, and arrive back at the office with sales orders for 175 units promised by Friday. You do the math. Some of those sales orders will turn into back orders and some of those backorders might turn into canceled orders. What’s the problem?

The problem is that we have a discrepancy between the output capacity of sales and the output capacity of production. It may look like a communication breakdown or even a personality conflict between the sales manager and the production manager.

There are several levers you might use to optimize the output capacity of the two systems. You might need one less sales person. You might need to schedule promise dates. If the market is strong and sustainable, you might need two of those machines to increase the output capacity of production to 48 units per eight hour shift.

Work Moves Sideways – Outputs and Inputs

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“Sales is complaining again,” Marlene announced. “They say all the leads that marketing gives them suck. They say they don’t even want the leads from marketing. If that’s the case, then why do we need the marketing department. Sales says that marketing is just a waste of their time.”

“Interesting,” I replied. “Then, what is the purpose for marketing? If you were in sales, what would you say is the purpose for marketing?”

“That’s simple,” Marlene said. “Leads. Marketing creates the circumstances where we identify people who have the kind of problems that we solve.”

“And, isn’t that what our marketing department does?”

“Yes, and no. The marketing department uses a variety of campaigns, trade shows, press releases, giveaways and social media to create inquiries. They are very proud at the number of leads they deliver to the sales team.”

“Then why the complaints?” I asked.

“The sales team has a very specific customer profile they identify as the ideal customer. Most people who don’t fit the profile, don’t buy. Last week, at a trade show, marketing gave away an iPad in a drawing in exchange for a business card. They got sixty business cards and turned them in as leads. When sales followed up, they found sixty people who didn’t fit our ideal customer profile. Waste of their time.”

“So, the sales team is looking for a very specific input, that meets several criteria for your ideal customer. But, the output of your marketing department is a list of people who want a free iPad? Your outputs and inputs don’t match.”

“Exactly,” Marlene nodded.

“So, if that’s the problem, how are you going to fix it?”