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Last year many of us experienced challenges with local, national, and global issues that often antagonized our businesses: subprime debacle, gasoline price increases, Middle East instabilities, etc. For 2008, most those aching challenges remain and others will crop up – which means that it is more important than ever that everyone in the organization do what they are supposed to be doing to ensure all strategies are implemented effectively.
The usual way to make “a new beginning” is to make a New Year’s Resolution. To minimize the impact of the many issues/headlines in our world and community we can’t control – and to get the results you desire in 2008 – might we suggest a resolution to truly manage your credit union’s performance?
What is Corporate Performance Management? Supervisors have conducted performance appraisals for years; planning, budgeting, sales, etc. processes have been carried out for years; employees have been trained for years – but even employee commitment as well as lots of hard work doesn’t mean results. In fact, often each of these elements happen in a “silo,” and within the silo, results might be achieved, but that doesn’t mean those results actually help the enterprise achieve the overall success of the business.
The real benefit of Corporate Performance Management is its focus on achieving results. Performance management focuses the organization’s efforts on effectiveness – and away from “busyness” (A busy organization, department, or person that isn’t necessarily effective.)
Corporate Performance Management should be viewed as a “system” of elements and processes in the organization working in harmony to achieve positive results. All the results from these various elements and processes must continue to be aligned to achieve overall results desired by the organization for it to survive and ultimately thrive. Performance management should focus on all of these areas: the organization, departments, processes (billing, budgeting, product development, etc.), programs (new policies and procedures, etc.), products and services, projects (automating the lending process, moving to a new building, etc.), and teams or groups organized to accomplish a result for internal or external customers.
Alignment is a critical factor in performance management. By way of definition, alignment is the intentional connection between vision, values, goals, strategies, measures, tactics, and activities. Lack of alignment increases inefficiencies, risks, and competitive threats. It slows down the organization and prevents effective execution of the organizational strategy. According to a survey of 1,100 participants, conducted by SAS.com, alignment is the primary benefit organizations seek from their performance management initiatives.
According to this same study, there are three kinds of alignment:
It’s sometimes difficult for organizations to achieve alignment. The biggest obstacle is that departments don’t share information or collaborate. Consequently, there is often a lack of trust, which becomes an issue in developing effective communication and collaboration channels. And this ultimately minimizes the real benefit of performance management/alignment – achieving results. For Corporate Performance Management to be implemented successfully, employees need to understand how all elements and processes are aligned as well as how their contribution to the enterprise supports the success of the overall organization.
Many successful credit unions are adopting Corporate Performance Management solutions to jumpstart and sustain improving company results. A good Corporate Performance Management system will have similar components: a future (shared vision) with business strategy, desired employee behaviors (values), and day-to-day operations. Strategic performance measures are also included in a performance management system to better inform decision-making and show progress toward desired results.
Corporate Performance Management solutions transform an organization’s strategic plan from an attractive but passive document into the "marching orders" for the organization on a daily basis. It provides a framework that not only provides performance measurements, but it helps planners identify what should be done and measured. It enables executives to truly execute their strategies.
Tips for implementing a successful performance management system are as follows:
Remembering and applying these tips to enhance your credit union’s Corporate Performance Management practices can take the sting out of 2008’s looming issues that may impact your member’s lives and your businesses. Members will be looking at their credit unions as safe havens from these issues that will most likely challenge the economy and their quality of life. Incorporating the stated performance management practices is a New Year’s Resolution that will help you help your members achieve desired results for 2008.
For more information on these performance management tips and more, please contact Jim Cardwell or Karla Norwood at Cardwell, 800-395-1410. Or visit our Connections Online website: www.connectionsonline.net.
January 7, 2008
Chuck Van Court
7/26/2012 04:00 PM
Very good and succinct article.
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