The ABCs of Performance Management

The worth of a company is measured by its assets. Over the past several months we have attempted to demonstrate to our readers that satisfied customers are a business's most important asset.

If we have convinced you of that, let us take this one step further. There are many components contributing to customer satisfaction, but none are more important than motivated, trained and empowered employees. That idea is not new. Many business owners and managers are tired of hearing about the value of employee satisfaction, but the fact is that no business will survive without a healthy measure of it. This is because every employee, even those with no contact with the external customer, can impact customer satisfaction.

It is usually at this point in our discussions with business managers and owners in Southwest Florida, that we elicit the response: "Our biggest problem is finding motivated and dependable employees." No argument with that from this quarter, but we ask the question: "What then, are you doing about it? Answers are difficult to obtain.

I doubt that there is a more commonly expressed complaint than the shortage of qualified prospective employees. Yet to accept this as a fact of life and be content to wait for this state to improve is counterproductive. Actually, the solution to under-performing employees may be much simpler than most think.

In reality, a business does not hire dependable employees; they create them. It is a fact that it is less expensive to retain existing customers than it is to find new ones. Similarly, it is more cost-effective to create effective employee-performance management practices aimed at developing and maintaining good employees than it is to get locked in the vicious spiral of hiring, firing and replacing employees that "do not work out."

Experts on human motivation and behavior seem to agree on one point: nobody enjoys doing a poor job of anything. On the contrary, people achieve real satisfaction in performing well in any task they are involved with.

So why do we not see more evidence of this in the workplace? The answer to that may lie in the fact that most management practices still depend on negative reinforcement to effect changes in employee behavior. Further, the use of goal-setting combined with clearly communicated consequences, positive or negative, to manage employee performance is often neglected.

Aubrey Daniels, in his book on performance management entitled "Performance Management: Improving Quality Productivity through Positive Reinforcement," describes how to apply the astonishing power of positive reinforcement in enhancing employee performance in those areas that most directly affect customer satisfaction.

Daniels uses an ABC Model: Antecedent, Behavior, Consequence. He refers to an antecedent as something that comes before an activity that encourages one to perform that activity or to generate a certain behavior. There are then consequences associated with the quality of that behavior.

More simply, to generate effective performance an employee must be given the information and tools to know what to do, when to do it, and often how to do it. This includes providing proper training, a clear set of objectives and the right resources to complete the job. These must be matched with a description of what will happen when an employee achieves certain levels of performance, i.e., the consequences of his or her behavior relative to the goals and objectives that were provided. For example, the objective provided to an employee may be to achieve 100 percent of their sales quota. The corresponding consequence might be a higher commission level for next period. Or it might not take the form of a material or monetary reward.

In another example, the goal might be for the employee to have an absenteeism rate of 2 percent or less. The corresponding, predefined consequence might be the opportunity to obtain flexible work hours.

Consequences are the Most Powerful Tool a Manager has for Increasing Employee Performance and Morale

Directions, objectives and goals are influential solely to the degree to which they predict meaningful consequences from an employee's point of view. In simple terms, to increase behavior, give an employee something he or she wants or eliminate something they don't want (reinforcers.) To decrease behavior, give something he or she doesn't want or take something away that they do want (punishers.). "Reinforcers" are much more powerful than "punishers" and positive reinforcement is the most effective type of consequence.

Many (some experts say most) problems in organizations are motivational. People need positive reinforcement, and recognition is one form of positive reinforcement. There are many types of recognition: acknowledgement; seeking employee's input to a problem; sharing information that is usually not provided with a high-performing employee; expanding their participation in some aspect of the business; taking personal interest in the employee; giving material rewards, and so on. But remember when looking for ways to recognize worthy employees, the consequence should be in direct response to the employee's achieving success in meeting a predefined objective (antecedent).

Obviously the purpose of this article is not to provide a comprehensive overview of human resource management strategies, but to show that there are a number of proven, easily implemented methods of improving employee performance and customer satisfaction. We think Aubrey Daniels offers one of the best and one that is simple and as easily applied to an organization with two employees as it is to a company with 2,000. It is as applicable to teams as it is to individuals. His timeless concepts are not in conflict with principles of Quality Management, employee empowerment or any of the current management philosophies with which we are familiar.

Daniels' book has had an incredibly strong influence on the views of thousands of people in hundreds of companies regarding performance and compensation and in solving problems of productivity, quality, safety, cost and morale, including companies such as 3M, Eastman Kodak, Xerox, Shell Oil, G.E., Target, Conrail and Honeywell. Many smaller companies have used it with equal success. The partners in BPM International have applied Daniel's methods in our own organizations and have successfully trained individuals and organizations in his concepts and methods for ten years. We recommend them highly to all our readers. Pick up the book from your local bookstore (Performance Management: Improving Quality Productivity through Positive Reinforcement by Aubrey Daniels)., call BPM at (800) 223-6191 to order it or e-mail us at Info@BPMInternational.com to learn more about how employee performance management can improve customer satisfaction levels and bottom line profitability.