Share:

If your performance culture isn’t very strong, if people just aren’t into measuring and improving, you might think your organisation isn’t yet ready for developing better KPIs. But the opposite is actually true: your organisation needs better KPIs, right now.

In their article in HBR’s April 2016 edition, Culture is Not the Culprit, Jay W. Lorsch and Emily McTague rightly point out that fixing the culture is rarely the right solution to organisational performance problems. Rather, they described how leaders focused more on changing the way performance is practiced in order to shift the culture.

The use of performance measures was one thing that the leaders used to shift the culture. They didn’t wait for a performance culture to enable measurement. They used measurement to enable a performance culture.

Culture is an outcome of, not an input to, organisational performance. And the way that performance measurement and performance improvement is practiced will have a direct impact on the culture that emerges.

If measures are used to monitor people’s performance and reward or punish them, you can imagine the kind of culture that will emerge from that. People will not embrace accountability for performance. They will fear bad results and the blame that will come, and consequently will either hide them, or turn attention to good news only. Trust, openness, and collaboration will deteriorate, and performance won’t improve.

But if performance measures are used to monitor process results and diagnose how to elevate process performance, a different culture emerges. People will embrace accountability as the practice of problem solving, not blame. They will be curious and collaborative, and consequently will appreciate how to work on the business and not just in it. Ownership and transparency will increase, and performance will improve.

If your organisation’s performance needs to be better, the only way forward is to measure it properly. That means measuring the results that matter, measuring them meaningfully, engaging people in creating and using those measures, and focusing on process improvement.

DISCUSSION:

What are the attributes of a strong performance culture, in your opinion? What practices help to develop those attributes?