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7 WAYS PERFORMANCE MEASUREMENT IMPROVES YOUR ORGANIZATION

Donna ChrobakVice President QuintLoyalty

“Employers are able to determine

what the best course of action

is for each employee to be

successful.”

7 WAYS PERFORMANCE MEASUREMENT IMPROVES YOUR ORGANIZATION

TQM, Six Sigma, Performance Measurement, they’re crucial to organizational success—that’s what they tell us. But what does it actually do, what are the actual benefits of implementing a strategic performance measurement plan?

Outlined below are 7 Ways in which Performance Measurement Can Improve Your Organization:

1. IT ALLOWS ORGANIZATIONS TO MEASURE TANGIBLE AND INTANGIBLE ELEMENTS TO GAUGE SUCCESS: A strategic performance measurement plan will identify key performance indicators that are quantifiable and, therefore, easy to measure. It will take into account measures that are tangible such as ROI, financial reports, as well as intangible measures such as an employees intrinsic motivation, their knowledge and skills, and their working environment.

In organizations without these key performance indicators, or where these KPI’s are not tied to organizational goals and objectives, it would be difficult to tell if there is a marked improvement in performance. Similarly, it ensures that any behaviors or actions that lead to success are being replicated and implemented as best practices throughout the organization.

2. IMPROVED TRAINING In an organization that is able to implement a successful strategic performance measurement plan, employers are able to determine what the best course of action is for each employee to be successful. By outlining strategic goals and objectives, employers can collect data on the best processes and methods internally to attain these.

Once collected they can implement this data into a more streamlined and comprehensive training program so that new employees can learn these best practices and achieve business objectives more quickly.

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“Your organization will end up reinforcing a company culture that perpetuates success. ”

3. HAPPIER EMPLOYEES Imagine for a minute that you are a new hire in an organization. Your job is simple: sell knives. In your new employee orientation you get information on what that knives are made of, what they can be used for and the warranty: everything you need to be knowledgeable about your product. So you hit the pavement, but you find that after many months you’ve only sold three sets, far under the quota that was set. In general, you will probably feel disheartened and may even come to resent your occupation.

With performance measurement plans the goal is to train employees in the best ways to reach their goals: in the case of knives, perhaps the neighborhoods that have the highest sales conversion, demographics on a customer that’s most likely to purchase, the average amount of time it takes a customer to consider the offer and then decide they would like to purchase.

By having a strategic performance measurement plan in place your organization will end up reinforcing a company culture that perpetuates success. Additionally, by providing this type of data to employees you’re enabling them to be successful, employees that find success at their jobs are happier which in turn leads to…

4. HAPPIER CUSTOMERS The old adage that happier employees = happier customers has been proven in numerous studies. One Harvard Business Review study showed a direct correlation in customer satisfaction comes from the employee-customer interaction. Additionally, it showed that when employees are happier or more satisfied in their job, there is an incremental increase in the level of satisfaction that customers report.

5. LOWER TURNOVER In addition to having happier customers, and higher customer satisfaction levels, happier employees are proven to stay with companies longer. The cost of turnover within companies is sky high. It’s more expensive to lose an employee than it is to properly train and engage them in order to retain them. With performance measurement plans, providing employees with the right data to see success in their work will aid in keeping them happy and staying at your organization for the long haul.

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6. GREATER ROI Once you use performance measurement to streamline a process to achieve a goal your organization will see a greater ROI. Say for example you are collecting data on the best ways to get employees healthy. You measure the impact of providing healthier cafeteria choices, participation in the company gym, and local gym enrollments. By getting an idea of which choice or combination of choice yields results you can create a program that you know will have a high success rate and therefore:

a. Save yourself time and money from testing or paying for measures that do not work

b. Can more quickly see a change in behavior

7. CHECKS AND BALANCES ON ORGANIZATION An added benefit of a performance measurement strategy or plan is that everyone in your organization is part of it. If implemented correctly it is a top down initiative that will hold every member of the organization accountable. This ensures that everyone in your organization is aligned with your businesses strategic goals.

An added benefit of a performance measurement

strategy or plan is that everyone in your organization is part of it.

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If you would like to discss how QuintLoyalty can help you design an effective performance measurement plan, please contact:

Donna ChrobakEmail: dchrobak@quintloyalty.com

LinkedIn

Phone: 704-926-2710 QuintLoyalty.com

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REFERENCES

1. Hensley, R. L., and K. Dobbie. “Using Tangible and Intangible Performance Measures to Determine Organizational Readiness to Implement Quality Improvement Programs in Service Operations.” Decision Sciences Institute, 2008. Web. 22 Jan. 2014.

2. Kane, Alastair. “Using Big Data to Improve Customer Experience.” Analytics Training Blog. N.p., 9 May 2013. Web. 04 Feb. 2014.

3. Medina, Elizabeth. “Job Satisfaction and Employee Turnover Intention: What Does Organizational Culture Have To Do With It?” Thesis. Columbia, 2012. Job Satisfaction and Employee Turnover Intention: What Does Organizational Culture Have To Do With It? 2012. Web. 21 Jan. 2014.

4. O’Brien Coffey, Jeanne. “Why Happy Employees Determine Your Success.” Executive Travel. N.p., Aug. 2009. Web. 04 Feb. 2014.

5. Trapp, Roger. “Poor Customer Service Explained By Lack Of Employee Engagement.” Forbes. Forbes Magazine, 19 Dec. 2013. Web. 20 Jan. 2014.