Earned returns on equity can be 1.5 times greater for companies that measure nonfinancial factors.
Michael J. Mauboussin, “The True Measures of Success,” Harvard Business Review, October 2012
We guide the organization in designing human capital metrics that best measure critical workforce outcomes to guide workforce decisions.
Organizations that do not measure the effectiveness of their people in meeting the business strategy may fail to see the need for corrective action before the problem harms business outcomes. Through the right metrics, we give the organization insight into the effectiveness of its workforce and the ability to act early when problems arise.
Motivating Behavior Through Strategic Metrics
A Fortune Global 100 consumer goods company needed to align personal performance metrics with the business goals. The company had been experiencing a steady decline in the productivity of its workers. Upon further investigation, the company learned that each region was emphasizing different performance metrics, which led to unbalanced work outputs. As a result, the company needed to understand the rationale for the emphasis of specific metrics and redefine personal performance metrics to align behaviors with business priorities.
We collected all written performance goals and categorized them into themes. We facilitated regional focus groups to understand the motivation in behavior and the potential perceived consequences for not performing certain behaviors. We met with representatives across the business and HR to review all of the information collected and aligned on the expected outcomes from the workers. With the expected outcomes in mind, we silently voted on the metrics we wanted to consider. We collectively developed hypotheses around which behaviors each metric would motivate. Those which we identified as having unintended negative consequences were modified or eliminated.
Productivity increased. With the alignment of the regional leadership, the organization communicated and reinforced the new metrics. Those who were in alignment and following the new metrics were publicly rewarded and celebrated. Those who did not meet their metrics were coached to increase their performance, and their team members were invited to help keep them accountable.