Human Resources plays a key role in shaping organizational performance. Thus, it should come as no surprise that HR professionals know better than most how our current systems are failing us. Increasing the effectiveness of managers is key and can make a significant difference in organizational performance. Working with managers to ensure people are appropriately assigned to positions and capable of doing the work is a step in the right direction, but it’s not enough. What other steps can HR take to increase managerial effectiveness and further organizational performance?
Performance Management Versus Effectiveness Management
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As an HR professional, you should be thinking about this question: “In my organization, what is the difference between performance management and effectiveness management?” They are related, but different concepts nonetheless. Performance management is a system that’s used to delegate objectives. It’s often used to measure performance and as a mechanism to provide feedback to employees. In many cases, it’s linked to compensation and can be best understood by how well we do our jobs.
Effectiveness management includes all of this, but is also concerned with what work is being done.
Many performance management systems do try to link objectives back to the strategic plan of the organization. However, without the appropriate accountability and authority frameworks in place and without each intervening manager setting context, boundaries and delegating work, it’s not possible to make that transparent link between each employee down through the organization. Objectives that are established as part of the performance management system are often set into shorter time frame, often do not reflect the appropriate complexity, and typically are not linked to the organizations strategic objectives.
Effectiveness Management Starts at the Top of the Organization
Effectiveness management starts at the top of the organization. The CEO obtains approval of a strategic plan from the board and then needs to determine what work he or she will personally deliver and what work will be delegated down to direct reports. The CEO must decide what he or she can do to add value at his or her level, and what aspects to delegate to direct reports so that the consolidated output of all of their outcomes will result in obtaining strategic goals within the appropriate timeframe. This cascades down through the organization so that each employee knows exactly the work they are accountable for, understands the authority they have to do this work, have clear context and boundaries for doing that work, and understand how it links back to the attainment of the organization’s overall strategy.
A Work In Progress
Is this easy to do? Absolutely not. Is there a payoff? Yes, and it can be huge. Imagine achieving a twenty percent increase in effectiveness in your organization. For an organization that employs 1000 people, that’s equal to hiring 200 more people at no extra cost. If managers are only spending 60% of their time doing the things they should be focused on – a 20 percent increase is both attainable and significant.
Our organizational systems are failing us. Helping to improve the effectiveness of managers and how they do their work does matter and can make a difference. While the CEO plays a role and can improve organizational performance directly, HR has an opportunity to impact the bottom line. By being accountable for improving organization-wide systems around performance management and effectiveness management, HR can actually make a difference that can drive the bottom line of the organization.
