The Performance Pipeline

Getting the Right Performance At Every Level of Leadership

Stephen Drotter

• Publisher: Jossey-Bass
• Year: 2011
• Print ISBN: 9780470877289
• eBook ISBN: 9781118086483
• Edition: 1
• Topic: Business
• Subtopic: Leadership
• Index: Business

The guide that defines the results required at each organizational level to sustain business success

It's not enough to build a company full of people with leadership skills. The Performance Pipeline digs deep into the real work of executing business results at each leadership layer.

• Filled with lessons and examples from the author's 40 years of experience
• Shows how to set performance standards, make sure the right work is being done, and remove performance barriers
• Illustrates how leaders can make the transition to the next level and achieve full performance

This book gives leaders in any industry an advantage over the competition.

Part I: The Performance Pipeline Concept

Introduction

Dealing with Pervasive Uncertainty

While a Performance Pipeline would have helped organizations years ago, current events and trends make it even more useful today. Let’s start out by examining how an uncertain and rapidly changing environment drives organizations toward the Performance Pipeline model.

We have entered a period of great confusion and volatility for business and its leaders. Executives at all levels have to deliver results under difficult and changing conditions. We are uncertain about a wide variety of issues, including

• The rate and nature of the recovery from the Global Financial Crisis
• Economic viability of customers and key suppliers
• The shifting balance of economic power
• Changes in consumer spending
• When and how to invest capital
• Finding needed skills in the available labor pool
• The consequence of government decisions on tax rates and regulation
• Commodity and scarce resource prices

Combined, these and other external uncertainties put leaders at every level under great stress and every business in a high-risk situation.

At the same time, businesses are living with great internal uncertainties—about organization capability, leadership effectiveness, alignment of priorities, ability to get all the work done, legal compliance, and the like. While these uncertainties have always existed, they are less tolerable in a more economically challenging environment. We can no longer accept leaders who don’t work on defining and delivering the future, who don’t work collaboratively with the rest of the organization, who don’t know what their people are doing, who don’t develop their people, and who don’t learn themselves. In a highly uncertain external environment, we should be making every effort to build more certainty in our internal environment—in the organization’s ability to perform. In the same way a violinist must know what her instrument will do when played faster or slower and with more pressure or less, we need to know what our organizations will do when strategy must change, when operating conditions change, or when customers’ needs change. We need to know that our leaders can handle the new challenges. Without a performance architecture that defines exactly what every leader at every level must produce for the business, all this change and uncertainty will blindside companies. That’s one reason the Performance Pipeline is such a timely tool.

Dramatic Changes in the World Economy Make Matters Worse

During boom years, there is room for error and inefficiency. Businesses make money and grow despite their shortcomings. Fueled by growth in India, China, and other developing nations as well as insatiable consumer demand that powered unprecedented consumer spending in the developed world, the global economy boomed. Winners were everywhere, and internal structural problems were papered over with profitable growth. Then, abruptly, it was over; the economy crashed. The Global Financial Crisis affected every business. Downsizing, outsourcing, and in some cases disappearance became the orders of the day for businesses around the world. Dramatic action was required, and painful choices were made. Survival was, and still is at this writing, a fundamental driver of leadership effort.

As we slowly climb out of the recession, we face many critical questions and the uncertainty seems even greater. How fast will the recovery happen? How should our strategy change in light of the uncertainty? How quickly should we rebuild inventory? When should we begin to hire, and how many people should we bring in? Where can we get the capital we need for investment; where should we invest and how quickly? What changes are likely in health care and in taxes, and how do we respond?

As a direct consequence of the uncertainty exemplified by these questions, every leader’s job has gotten harder. Under this kind of pressure, leaders at all levels have become focused on the short term and reactive just when they need to be looking forward and planning rigorously.

As leaders attempt to address these externally driven challenges, they will need new solutions and much more alignment and flexibility inside their companies to be sure they can respond effectively. Going back to old practices developed to address a very different set of business conditions doesn’t make any sense. Leaders at every level need to think more broadly, find new methods, provide greater clarity, and enable sharper focus. These must become the guiding ideas for leaders at all levels. Delivering the right results at the right time in the right way has to be primary, and new tools and practices are required to do it. We must make a fundamental shift in our basic leadership practices if we are to succeed in this uncertain environment. As we’ll see, the Pipeline model makes this shift possible.

Four Imperatives

I would like to focus your attention on four key imperatives for leaders in our current environment. These imperatives dovetail with the changes sweeping through organizations today; the Performance Pipeline makes it possible to address these imperatives. Before looking at how the Pipeline does so, let’s look at the four imperatives and why they must be addressed.

1. Thinking More, Learning More

Thinking about the current performance and future direction of your business or function has to include major economic trends, world political events, currency fluctuations, new competitors, global best practice, rapidly evolving technology that is changing how we work, consumer preferences in many countries, and so on. Specific needs associated with your products, customers, suppliers, competitors, likely new market entrants, and your workforce change how you look at the world, not whether you should look at it. We all have to consider a wider range of variables. Learning about the world around us requires time every day.

Fortunately we have computers and the Internet to help with information flow and retrieval. Although we cannot trust it implicitly, information is plentiful in cyberspace. Before we make decisions, however, this information must be validated by firsthand experience, personal observations, and input from trusted sources. We also have to think carefully about what the information means once we are satisfied it is valid, since the context in which we work has changed.

Thinking takes time. The more variables we must consider, the more time we need to think. As you no doubt are aware, leaders lack thinking time. Meetings from morning to night, one hundred or more e-mails per day, voice mail, family demands, and travel are the norm. Thinking deeply and reflectively under these conditions is difficult. We become caught in “activity traps” and thus fail to think and learn.

THE FIRST IMPERATIVE: Every leader spends thirty minutes to one hour or more daily in uninterrupted thought.

2. New Methods for Almost Everything

It isn’t an exaggeration to say that most businesses need new methods for just about everything they do—a rapidly changing environment demands it. Unfortunately, most companies are better at squelching new ideas than they are at encouraging them. Think about what happened to the last new idea you put forward. How long ago was it? How was it received? What was the result? How do you feel about putting forward another new idea?

In the midst of all the chaos that exists in most companies, new ideas often aren’t heard. Loud, powerful voices defend the status quo at strategy and budget meetings. There isn’t enough time for creative thinking, and even if there is, the culture or management may eschew the risk that comes with “new.” So, we do the same old things but perhaps a little cheaper or a little faster. It is so much easier to just keep doing what we did yesterday.

THE SECOND IMPERATIVE: Everyone must innovate as a natural and expected part of one’s daily routine.

3. Clarity of Role and Purpose

When people show up for work, they should know what is expected of them, when it is due, what the cost should be, and what standards must be met. Everyone wants to know these things. Management practices commonly used now don’t deliver role clarity. In fact, many current practices confuse rather than clarify.

While balanced scorecards are valuable frameworks for directing and measuring team or business performance, they don’t tell individuals what they should work on and are usually silent on leadership work. Strategy is critically important for the business but generally doesn’t naturally penetrate to lower levels. Strategy needs to be translated downward, layer by layer, but seldom is. Lower layers are left with the responsibility for interpreting what their contributions should be. Several recent studies on this subject concluded that employees at the bottom are more likely to do what they have been doing even if it doesn’t fit the strategy. Goals and key performance indicators (KPIs) tend to be operationally focused or financially oriented. They are great as far as they go, but softer parts of leadership work don’t often make the list.

Company programs for developing leaders are designed generically and focus on corporate citizenship. They don’t help much with clarifying the role and purpose of an individual job. How to do your specific job is rarely taught.

THE THIRD IMPERATIVE: Leaders must provide true role clarity and purpose for every employee.

4. A Focus on Delivering Value

Leaders who are tied up all day in meetings, who spend their time “doing,” and who work at the layer they came from, or even lower, rather than at the layer to which they are assigned, don’t add enough value. They can’t possibly engage properly with their people. As a consequence the priorities are often unclear or nonexistent for their teams. The proper focus required to deliver the right results at the right time in the right way is missing. Extraneous or simply urgent matt...

Table of contents

• Cover
• Title page
• Copyright page
• Dedication
• Preface
• Part I: The Performance Pipeline Concept
• Part II: Expected Results at Every Level of Leadership
• Part III: Successful Implementation of the Performance Pipeline
• Tool 1: Actual Performance Pipeline from Company E
• Tool 2: Interview Questions
• Acknowledgments
• The Author
• Index