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Systems View of Performance Management

by: Gary W. Wilson

This article uses and builds on the concepts presented in the book “Improving Performance: How to Manage the White Space in Organizations” by Geary A. Rummler and Alan P. Brache.

Performance Management is often viewed in the context of periodic formal reviews of an employee’s work performance by their manager. When it comes to Human Performance, managers should not restrict themselves to just managing periodically or using only formal methods.  The performance of employees contributes to a larger encompassing system.  How the employee performs impacts and is impacted by that larger system.  Along with other employees, how the encompassing system is managed determines the success of not only the employees but this containing system as well.  The question is what are the systems the employee operates in and is connected to?  Also, are these systems connected to even larger organizational systems?

Performer/Machine Level:

Whether a machine operator, bank teller or executive director of operations, no one operates in a vacuum.  Everyone functions within a system whose elements interact to allow the employee to receive inputs, perform some activities and deliver some output to their customer.  Sometimes the customer is external to the organization as part of the organization’s Core Business Process or an internal “upstream” customer.

These elements are not merely a list or cobbled together; they interact and synergize.   For example, Performance Objectives (Job Descriptions) and Performance Metrics need to be linked and reinforce each other.  Why have a Performance Objective but not measure it or worse measure something contrary.  Accountability and Incentives also need to reinforce performance objectives and are dependent on good metrics.

Practitioners in the field of Training and Development are generally familiar with the appeal to help managers solve a “Training Problem”.  Most experienced T&D folks generally know that T&D is a solution to a problem and not the problem.  A simple inventory of the other elements in the Performer Performance System suggests that there is only a small chance that a lack of Knowledge and Skills is the cause of not getting the desired output.  (Assuming the initial new employee training & development activities have been done.)

Managers are responsible for ensuring the Performance System is complete and the elements in alignment for each of their employees.  That includes providing regular feedback and positive re-enforcement which, as motivational theory suggests, is a stronger motivator than periodic rewards and penalties.   

How is the Performer connected to the larger system?

Process/System Level:

Unless you are a sole proprietor of a business you generally work with others.  Even if you are the sole proprietor you probably perform a variety of activities to deliver your goods or services to your customer.  It is the sequence of activities executed together that forms a process.  Processes also have inputs, activities and an output.  It is how “work” gets done and thus has a flow.  It can and is often diagramed using a variety of process or flow “maps”.  The individual performers/machines are illustrated in the mapping and describes the role or function to be performed at specific steps in the process.

It is here where the inputs and output requirements of the individual performers are defined and how they are integrated as part of a larger system.

As mentioned earlier, managers generally don’t manage periodically at this level.  Process KPIs can be inbound quality, process control and/or outbound product quality.   They can also be metrics about Effectiveness or Efficiency.  Organizations can become overwhelmed with Effectiveness and Efficiency KPIs to the point that it interferes with the manager’s performance system.

Depending on how large the organization or how deeply integrated the business, processes can roll up in a hierarchy from Teams, to Cells, to Areas, to Departments/Functions, to Locations and finally to the Organizational Level.  Quite often Locations may mirror the Organization as a micro-Organization that is replicated at different locations/sites.  They may have similar processes but deliver different products. The Steel, Auto and Flooring industries are just a few examples.  No matter what level of process detail is mapped, the same input – activities – outputs model applies and some number of individual performers may be visible on the maps.

Organizational Level: Where the “Core Business Process” resides.

At the Process/System level the interfaces are generally all “internal” to the organization.  At the organizational level we begin to see external interfaces as inputs and outputs with Customer, Investors, Suppliers, Debtors, Governmental agencies and Employees (formal and informal representation).  Usually this “outward view” is the purview of the C.E.O and the board.  However, it is also managed by individual location managers as mentioned earlier with the assistance of the location manager’s staff/team.

It is at this level that the Core Business Process map is developed that has two additional pieces of information that lower level System/Process maps generally do not.  Both System/Process maps and Core Business Process Maps illustrate the flow of material and information.  However, the Core Business Process has the external interfaces along with the Customer as they order goods (Sales) and Delivered (Logistics).  The Core Business map also includes the flow of money. 

It may seem somewhat obvious but mapping how the money will flow through the organization helps identify critical activities.   Suddenly the Order processing function and the Accounts Receivable functions take on a new level of importance.  They are both primarily information processing functions, often managed as silos, but someone should be aware of the integration.  The systems that are used and the performance of the individuals that design, operate and maintain those systems should gain lots of attention and their performance well managed.

Wrap up:

Hopefully, this article has illustrated that performance management is an integrated system at 3 levels of an organization and is not just periodic performance reviews of employees.  Whether you are designing a system from the start, improving a current system or troubleshooting performance problems within a process, understanding the process and its operation is critical to improving performance.  Issues and problems can originate anywhere in the three levels.  Making sure one understands the interactions and the kinds of relationships within the organization is the key to solving performance problems.

About Gary W. Wilson:

Gary W. Wilson has a Masters in Human Resource Development, plus over 3,000 hours of workshops, conference, and internal training and development courses.  For the past 10 years, he has been working with Gerdau Steel as a HR Generalist specializing in Talent Management processes.  He retired from General Motors where he held a variety of roles in Maintenance/Reliability and Organizational Development, both as resource and manager.

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