Can management systems cope
with the rapid pace of change in Society today? We believe they can but it does
require new ways of looking at problems and putting in place systems that can
adapt to those fast moving environments.
If you think about what has happened through political turbulence and
also economic turbulence in recent years, and the rate at which technology is
developing then you can see that the World is moving incredibly quickly. What
we need to do is to have systems in place that are able to cope with and be
updated rapidly to manage those changes. If we get the systems right and
organisations adapt and change appropriately then profitability will increase
and that can only be good for the recovering UK economy.
We began our research by thinking about what are the most turbulent
environments which organisations are operating in, where are the really
challenging environments? That led us to think of the rate at which some of the
hi-tech firms are changing.
The question we wanted to ask is: ‘If it takes you a long time to design
a measurement system normally, and if you think measurement systems are central
to the way you manage organisations, how are these hi-tech firms that operate
in very fast moving environments actually coping by deploying and developing
their measurement systems?’
We know that it is not as easy to forecast what is going to happen in
the future, and coupled with that most organisations these days are also
creating vast amounts of data almost as a by-product of their existing
operational processes. So there is more synergy between the new businesses like
Facebook and Google and the traditional businesses than you might at first
think.
We found a number of practices that seemed to be in operation in those fast
moving organisations but at the heart there were two cycles they used: a performance management cycle and an execution cycle.
It is important to look for the connection between the two cycles. We
want managers to ask: ‘How do we know we are doing the right projects to drive
performance in this business?’ ‘How do we make sure we are executing those
projects quickly and how do we know when to step back and change the portfolio
of projects and look for new things to do?’
What the PMTE (Performance Management for Turbulent Environments)
framework does is that it gives
you a method and a system to think about the way you are approaching
performance management in your organisation. There is a lot more to making an
organisation successful than simply getting a measurement system right, but it
is an important element.
The key
to successful working are the five enabling foundations that happened in all
the organisations we looked at:
Strategic intelligence is about scanning externally for ideas and capturing that intelligence.
Continuous conversations are about
continually exploring and thinking about that information across the
organisation. If you get that right you
get accelerated learning, where you
actually start to learn faster about what is working and what is not working.
But you
need a framework that gives organisational
alignment to allow those continuous conversations and accelerated learning
to take place across the organisation. However, you are not going to do that
unless you have engaged leadership that
actually legitimises it inside the organisation and allows people to use
performance data to drive improved performance.
We need
to make sure performance measurement systems are as dynamic as possible in
organisations and that they really help you to learn fast.
The
faster you can get round that process then the faster you can learn and the
more likely you are to survive in turbulent times. Robust systems are the key
to today’s rapidly moving turbulent times.
More on this can be found in this book by Andy Neely and Ed Barrows. or here for a Podcast
Interview with Andy Neely
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