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key performance indicators

TURNAROUND MANAGEMENT: Do Your KPIs Tell You It’s Time?

August 10, 2017 By Sam Palazzolo, Managing Director

The Point: – The compilation and coordination of Key Performance Indicators (KPIs) are taken very seriously by numerous companies for good reason. They often determine the business strategy the company will accept, and the strategies that should be rejected. Their compilation acts as a tool that differentiates the company from other competitors. So if you ask some business owners, they will tell you that the essentiality of business KPIs can never be over-emphasized. When your company needs turnaround management, business KPIs can help you drive back your sales, profits, and even make your company’s growth surpass previous levels. Nonetheless, if they are not managed appropriately, they can be detrimental to your business strategy. So in this post, we’ll explore the topic of Turnaround Management: Do Your KPIs Tell You It’s Time?… Enjoy!

TURNAROUND MANAGEMENT: Do Your KPIs Tell You It’s Time?

DO YOUR KPIs TELL YOU IT’S TIME?

Your Key Performance Indicators (KPIs) tell you whether it’s time to make changes in your business or not. Basically, the reason why companies rely on KPIs is to know if the things that are being done in the company are having a real effect on the business, measuring performance in a variety of categories. You can invest all your time and energy in getting so many tasks done by your company, only for your business KPIs to tell you that your performance needs improvement. You may think you have the best business strategy, but unknowingly to you, it is not effective enough. KPIs can indicate to you that there is need for turnaround management before the problems of the company present themselves (And if you’re like most of the organizations I consult with, there typically are one or two problem areas present regardless of how smoothly run the operation is!) Companies that track their KPIs and take it with seriousness rarely face worst state issues.

IT’S ALL ABOUT BUSINESS STRATEGY!

Measurement of business’ KPIs indicates to the leader how much, or the number of something, there is and allows for compare/contrast analysis between the different measurements taken (i.e.. total revenue last month versus previous month, year-to-date average, last year same month, etc.) The metrics and measurements however tell managers that it is time to add something to the business strategy or remove something.

KPIs FOR BETTER PROJECT/RESOURCE/TEAM MANAGEMENT

A company that does not rely on business KPIs will find it more difficult to manage projects, resources, and massive teams, when compared to a company that tracks and measures KPI. This is the advantage of companies that rely on KPIS that makes them rarely face issues in the worst situations. Every business owner should see the measurement of KPIs as a perspicacious idea, and use it to decide “next steps” for their business.

WHO SHOULD COMPILE KPIs?

Since your KPIs tell you it is time to make changes in various aspects of your business, it should never be taken as a trivial tool. If possible, employ a qualified person that can measure KPIs with data integrity/consistency, and at the same time decipher it for you. Your KPIs will guide you positively in so many ways, so it should be measured regularly, and followed-up properly to avoid unnecessary and superfluous turnover of processes/procedures/management.

SUMMARY

In this post we’ve explored the Turnaround Management topic of KPIs, namely if they are telling you it’s time to move your business around. Your KPIs are a toolkit that shares a lot of important metrics by which you can drive your business forward with from analysis. Not measuring leads to not managing, and may cause you to miss out on important turnaround opportunities!

Sam Palazzolo

PS – If you/your organization has challenges as a result of Turnaround Management activity, please don’t hesitate to drop me a line and request future post titles! Here are a few other titles that are currently in the works:

  • What Role Does Technology Play in Turnaround Management?
  • The Tough Work of Turnaround Managment – 4 Tips!
  • Why Companies Fail or Enter a Declining Period during Turnaround Management
  • The Stages of Corporate Turnaround
  • The Stages of People Turnaround Process

 

 

Filed Under: Blog Tagged With: business strategy, key performance indicators, kpis, leaders, sam palazzolo, turnaround management

The Leadership Challenge: Leading the Shit Show – 5 Tips!

July 7, 2015 By Sam Palazzolo, Managing Director

The Point: Leading a finely-tuned team is the stuff of Harvard Business Review Case Study dreams. Unfortunately, the high-functioning, smooth-running, and operationally efficient leadership moments at times seem like a far-off distant place perpetually out of sight, definitely out of reach, but within smell! So what happens if you lead a shit show at the office? What then HBR? In this post, we’ll take a look at five (5) leadership tips to go from porta-potty leadership struggles to indoor plumbing leadership nirvana… Enjoy!

The Leadership Challenge- Leading the Shit Show – 5 Tips

Let the Shit Show Begin!

Sometimes I wonder as an executive coach and leadership development expert if my clients are putting on a “show” during one of my visits just to see if I lost any of my leadership sharpness? While it’s been nearly three (3) years since I lead a tech-startup, I’ve continued to have leadership “hands on the wheel” leading the venture at Tip of the Spear. However, this doesn’t seem to deter my clients from either flexing their funny bones, or having me show up to visit them on a Monday (or pick your least favorite FUBAR moment).

This past month contained yet again one of those moments, captured perfectly by these three (3) vignettes:

  • Customers Everywhere (with checkbooks/wallets/purses open ready to spend $$$)
  • Employees Nowhere
  • Leadership Running Around a la Chickens

Was it just for show, or was it for Sam? Regardless of who it was for I know for certain who it was not for and that was the customer’s experience (CXI for short). Customers (yes, one and all) hate these moments where disorganization rules and the proverbial fan has ceased due to feces pelting it repeatedly. So what’s a poor leader to do in moments such as these? The following five (5) leadership tips were compiled from various leadership development and executive coaching sessions to allow you to go from porta-potty struggles to indoor plumbing nirvana.

Tip of the Spear_July WWP II
Looking to develop tomorrow’s leaders today? CLICK HERE to see our July 2015 Honor Independence Day All July Long Specials – A portion of the proceeds will be donated to The Wounded Warrior Project!

Tip #5 – Personnel

Whether you’d like to believe it or not, or how many technology barricades you might have erected, if your business is like most it still relies on the people you employ to pull off/execute the many tasks deemed necessary in daily efforts. Hire wisely (a la “Top Grading”) and you will be rewarded. Fail at hiring effectively and you will know the purgatory of Hell on Earth (all the while not being deceased yet!)

Tip #4 – Pay Plans

All things being equal, your employees will do what they get paid to do. While it’s a grandiose thought that your employees will conduct actions based on the company culture or your mission/vision/values statement created at a company retreat 10+ years ago, know that they will instead do what they most topically get paid to do. If your system of bonuses/spiffs/commission schedules don’t include metrics that are near/dear to your business livelihood, you might want to reconsider how you pay your people.

NOTE: Two funny stories:

  • Story #1: A business owner one time tried telling me that it’s a requirement of employment that employees pay attention to a key performance indicator – KPI (in this case, customer satisfaction). The store metrics reflected that they were in the bottom 10th percentile in this KPI, which begged the question “When will everyone be getting fired… Today or Tomorrow?”
  • Story #2: A leader at an organizational headquarter requested a meeting with me to identify why I kept on reporting on how people during a change initiative were getting paid. This KPI appeared to be “out of the normal” for reporting purposes and furthermore “clouded” the situation with unnecessary detail. Again, not certain what leadership development school they attended or executive coaching methodology they employ, but the boat had clearly left the dock (and Elvis had left the building!)

Tip #3 – Processes

You must have processes that reflect your desired end state of business. Efficiently identified for 90+ percent of the typical business happenings, they should be designed/implemented within the team and contingency plans should be drafted for the additional 10 percent of the times (aka, When things don’t run the way they should, either due to personnel, technology, or customer experiences).

Processes should be developed, tested, and more importantly reviewed on a daily/weekly/monthly schedule. One of the biggest mistakes I see is when a company enacts a new process, only to have questions arise a month later regarding “Where did it all go wrong?” Remember, just because you explain a process to a stakeholder one time does not mean that it will be encased in the stone memory vaults for all to recall each and every time. Instead, review the processes at periodic intervals to ensure accuracy in execution and appropriateness for the current day/month/time of year.

Tip #2 – Metrics

You run your business based on key metrics (See KPI discussion earlier in Tip #4). Ensure the accuracy of the data you collect and report out said data frequently.

Tip #1 – Accountability

This is the role of a leader (besides leading). You must hold those around you accountable for what we all agreed to. If processes are executed accordingly and metrics reflect the effort/energy expended then review that… If/when they don’t review that too! It’s often a fine-line between praising in public and reviewing poor results with a group. While not casting blame, keeping solution-focused, and seeking process modification ideas you can/will get things turned around.

SUMMARY

Let’s face it, we’ve all been “there” where “there” consists of a show relegated to the higher numbers on your cable television package. It’s a place that reeks of poor personnel, pay plans, processes, metric results and lack of accountability. I hope that this trip down stinky-lane will allow you to pursue more pleasant odoriferous paths in the future.

 

Sam Palazzolo

Filed Under: Blog Tagged With: accountability, executive coaching, key performance indicators, kpi, leadership development, pay plans, personnel, processes, the leadership challenge

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