Can management systems cope with the
rapid pace of change in Society today? We believe they can but it does require
new ways of looking at problems and putting in place systems that can adapt to
those fast moving environments.
If
you think about what has happened through political turbulence and also
economic turbulence in recent years, and the rate at which technology is
developing then you can see that the World is moving incredibly quickly. What
we need to do is to have systems in place that are able to cope with and be
updated rapidly to manage those changes. If we get the systems right and
organisations adapt and change appropriately then profitability will increase
and that can only be good for the recovering UK economy.
We
began our research by thinking about what are the most turbulent environments
which organisations are operating in, where are the really challenging
environments? That led us to think of the rate at which some of the hi-tech
firms are changing.
The
question we wanted to ask is: ‘If it takes you a long time to design a
measurement system normally, and if you think measurement systems are central
to the way you manage organisations, how are these hi-tech firms that operate
in very fast moving environments actually coping by deploying and developing
their measurement systems?’
We
know that it is not as easy to forecast what is going to happen in the future,
and coupled with that most organisations these days are also creating vast
amounts of data almost as a by-product of their existing operational processes.
So there is more synergy between the new businesses like Facebook and Google
and the traditional businesses than you might at first think.
We
found a number of practices that seemed to be in operation in those fast moving
organisations but at the heart there were two cycles they used: a performance
management cycle and an execution cycle.
It
is important to look for the connection between the two cycles. We want
managers to ask: ‘How do we know we are doing the right projects to drive
performance in this business?’ ‘How do we make sure we are executing those
projects quickly and how do we know when to step back and change the portfolio
of projects and look for new things to do?’
What
the PMTE (Performance Management for Turbulent
Environments) framework does is that it gives you a method and a system to
think about the way you are approaching performance management in your
organisation. There is a lot more to making an organisation successful than
simply getting a measurement system right, but it is an important element.
The
key to successful working are the five enabling foundations that happened in
all the organisations we looked at:
Strategic intelligence is about
scanning externally for ideas and capturing that intelligence. Continuous
conversations are about continually exploring and thinking about that
information across the organisation. If you get that right you get accelerated
learning, where you actually start to learn faster about what is
working and what is not working.
But
you need a framework that gives organisational alignment to
allow those continuous conversations and accelerated learning to take place
across the organisation. However, you are not going to do that unless you
have engaged leadership that actually legitimises it inside
the organisation and allows people to use performance data to drive improved
performance.
We
need to make sure performance measurement systems are as dynamic as possible in
organisations and that they really help you to learn fast.
The
faster you can get round that process then the faster you can learn and the
more likely you are to survive in turbulent times. Robust systems are the key
to today’s rapidly moving turbulent times.
Andy Neely and Ed Barrows
