Managing Outcome V’s Activity

Managing Outcome V’s Activity

May 31st, 2011 // 8:17 am @

Does this sound like a business you know?

  • Frantically busy managers, complaining they are over worked.
  • Managers complaining that they have to do everything themselves
  • Staff who look disinterested in the company and their jobs.
  • Key things not getting done, with a sense of disorganization.

Well, if this reminds you of a company you know I would not be surprised. It is all too common and is often caused by senior managers attempting to micro manage the company.

People micro manage for a number of reasons. It is often as simple as they have never been shown a better way, and also micro management feels safe, it sooths our anxiety over what we are doing, as we are involved in every decision.

The key problem with micro management is simple – it does not work!

What it drives is almost always a negative result:

  • Massive stress on senior managers who attempt the impossible task of knowing everything and making every decision. This is impossible in anything but the smallest of businesses.
  • It stops growth, if the senior managers need to be involved in every project, and every customer they become the limiter on the growth of the company.
  • Managers struggle when caught in the minutia, to be able to step back and focus on what are the company’s real key business drivers are.
  • It corrupts outcomes, if you focus on a particular activity you hope will drive an outcome, staff will often deliver the activity but not the outcome. To give an example, I worked with a telephone sales company that tracked and drove “Time on the phone” an activity not an outcome. Staff just called the weather line or something similar and left the phone on and got the phone time desired, but few sales. When we stopped monitoring phone time but focused on and paid staff on “Sales” made, which was the outcome we wanted we helped drive 45% year on year company growth for 5 years.
  • Staff switch off if you make every decision for them, you drive them into a “I’ll just wait and do what I am told” attitude. This is wasteful of their innate talents, is demotivating for them, and often makes them inefficient as they sit around waiting for management to tell them what to do next.
  • The company loses the staffs input. Often the staff doing the job whatever it may be have a much better idea of how to make things work than senior management do, but if micro managed they simply switch off.

So what is the alternative? Well you can try managing by outcome, not activity. This requires some trust in your fellow human beings, but based on my experience 90% of the time you will be stunned at how well they respond.

So how do you manage by outcome?

  • Focus on the key business drivers; what outcomes really make a difference to your business.
  • Define the outcome you want for each key business driver. For example, job completed on time within budget.
  • Decide who is going to be responsible for that outcome and make sure they have the tools and support:
    • Skills required, tools, information, and authority.
    • Brief them on the outcome you want and why it is important.
    • Track success, be prepared to loop back and amend if required.
    • Be prepared to help them as they learn, but not to take away their responsibility for the outcome.
    • Celebrate success, tell the world when they succeed, and make them proud of themselves, the company and their part in it.

I am confident that if you can make this move you will be surprised at how staff will rise to the challenge, come up with new ways to achieve your goals, and be much happier in their jobs.

You will know when you have succeeded, as you will find times when as CEO you have nothing to do. You will sit there confident you understand your business model, you have focused staff on the right key business drivers, everyone in the company is focused and motivated correctly and if you interfere you will actually make things worse. All you have to do is sit back and let them get on with it.

Being a CEO with nothing to do occasionally is a sign of great management……..

 

 


Category : Blog &Leadership

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