ON ACCOUNTABILITY || 4 Things I Learned to Improve the Outcome of Using Performance Metrics
Year-end performance reviews are coming up, and there are always two camps in measurements: to measure or not to measure.
People tend to perceive metrics in two different camps at either extreme. The first camp believes there shouldn’t be metrics because you’re hindering creativity and boxing people into their roles. The second camp wants to measure everything. I’ve learned a few things that could help you plan next year’s staff reviews a bit easier.
My two cents on the two camps are: if you don’t measure anything, it’s like elementary school where you’re showing up for participating points. if you measure everything, then there’s not enough focus. Still, I believe that something should be measured instead of nothing. When you measure nothing, it means nothing matters to your company, and your success will come because of luck. What happens when luck runs out?
Here are a few things I learned about metrics that hopefully could help you plan for next year to align your business and team direction.
MEASURE THE ONLY NUMBER THAT MATTERS
When we first implemented our metrics for every staff member, we intended to help them see their performance funnel. For example, to get to an ultimate conversion, you would need to increase impressions, clickthrough and engagement rates before a prospect converts.
This opened a whole can of worms because the team then just focused on each of the numbers and not on the funnel, but to perform well, they would first need to see the funnel, know which one is the ultimate number, and focus on that. Take away all the supporting numbers and have one metric the team member needs to hit. Then, they will have to figure out the funnel by themselves or with your help.
From this experience, our management team has talked about making some changes, namely, to measure just ONE number instead of several, because we have seen that the other numbers feed into the most important one. For example, one staff member in charge of customer relations might have the Net Promoter Score as their ultimate number. Another person in charge of driving sales might be net profit per client. Someone managing social media accounts might have engagement rates as their ultimate number.
“You can’t improve what you don’t measure.”
EVERYONE NEEDS TO KNOW WHY THEIR NUMBER MATTERS
I planned our company’s metrics backwards. I first set my number and then looked at our organization chart and workflow to identify how each team member’s key metrics could support the ultimate goal—my metric.
Metrics should feed into the ultimate goal of the organization. As the manager or owner, you must explain to each staff member why their metric matters to them and the company's overall health. This would matter even more so when employees operate within a big company because they may have much lower visibility on the company’s grand plan and feel unsure of how their efforts add to the ultimate goal.
As the manager or owner, you should see setting metrics as a strategic exercise to align everyone in the same direction. Draw it out, start with your number and then work backwards to show them in a team meeting why everyone’s numbers matter to the department or the company’s goal.
You need to have an ongoing conversation with members of your team to reinforce why their numbers matter to them and to the company. It shouldn’t be a one-time thing.
Take the time to sit with each team member, explain the metrics' rationale, and establish the goals collaboratively. Yes, there will be unforeseen circumstances throughout the year that impact whether team members can hit their goals, but instead of continually changing your goals and moving the goalpost, make it clear that the metrics are guardrails to keep them on track, they aren’t everything. Also, when coming up with the metrics, there should be some margin of error to allow for such events. If the numbers are really far off, then the collaborative goals you set with your team must be discussed because you all got it wrong. Something needs to change with your goal-setting process, and you need to identify the cause together.
NUMBERS AREN’T EVERYTHING
You could tell your team that numbers aren’t everything, but your actions should align with what you say. They may feel they did a great job on a project, but it doesn’t directly contribute to their performance review. What happens then?
It takes time, experience and will to become an observant manager or business owner, but let’s say you do see the extra effort. Here’s what I recommend you do: 1) recognize the positive behaviour and 2) offer a small reward. Ask the boss for rewards if you don’t have the authority to hand out rewards. If they’re a good boss, they would reward such behaviours and also see you as a good manager who keeps team motivation in mind.
METRICS SHOULD IMPROVE THE EMPLOYEE AND THE COMPANY
While year-end performance reviews are important, they shouldn’t be discussed only at the end of the year as their name suggests. We do a monthly check-in with each staff member to see how they’re doing with their goals and ask how we can support them. The metrics should not be used just for the benefit of the company, it should also train the employee to sharpen their skills. For example, if you ask an employee to increase conversions on a campaign, the company should be ready to provide the training to enable them to reach the goal.
Your role as manager or business owner is to provide guidance, and training, and share your insights. You can’t actually do the job for your team.
This could be through training and strategy sessions where you sit down with the member, or online courses, or sometimes buying a technological tool or online subscription service to help them get more productive and free up their time for things that matter. But don’t fall into the trap of doing your employee’s job. You already know how to do their job; that’s how you got promoted to oversee their work. It would help if you were not doing it for them because it’s to the detriment of your productivity as a manager and their growth as an employee. To train a real successor, you must let go of the reigns. If they can’t step out, they can step out.
Imagine you’re teaching a child how to ride a bike. The best you can do is provide guard rails to minimize the number of times they fall and hold their seat until they gain momentum before you let go, but you can’t ride the bike for them. This way, they would never learn how to ride the bike on their own.
While we all want to get it right 100% the first time, it won’t be an easy road because there will be grumblings and learnings. Setting up metrics for your company or department is never easy. How do you decide what to measure? Before you start, I recommend you take a good, hard look at your strategy and where you want to go. You, as the leader, must decide the direction to align everyone to it. I hope my learnings help to make the road a bit smoother for you and the team.
