Axio Development

Monthly action plan meeting

Setting SMART KPI’s and performance managing your people

I started a project with a new customer last week and along with developing the next tranche of managers and leaders through and ILM accredited leadership programme, we kicked off with all of the current senior management team on developing meaningful  Key Performance Indicators (KPI’s) for all aspects of the business. This was then followed by developing an effective performance management process so that the KPI’s are implemented and the managers have a clearer idea of how everyone is performing.

Whilst all of the senior team understood the concept of KPI’s and performance management, it soon became clear that the practical, day-to-day application and use of these processes was basically new to them.

This is not at all unusual – in fact it is very common! Many businesses that I deal with claim that they ‘do’ set SMART Kpi’s and performance manage their people but when you get down to “brass tacks” they are only playing lip service to it.

There are many reasons why this is the case but some of the most common are:

  • The managers are simply not aware of the need.
  • They don’t have the knowledge of how to.
  • They know the theory but are simply not applying it.
  • They don’t have the ability because of a lack of confidence.
  • They avoid having the more difficult conversations often because poor performance has been allowed to happen for a significant period.

Here are some simple steps in an effective, results based, performance management process:

Step 1. Develop clear, measurable KPI’s for the whole business

The KPI’s should be the overall broad headings e.g. Administration, Sales, Quality, Finance, Operations, Production etc. Under each of these KPI’s should be a list of Performance Standards which set out If the result required is on-going, without an end date, the frequency of the activity and what exactly the finished result looks like. These tend to describe our day-to-day job. The performance standards need to be Specific, Measurable, Achievable, Results based and Time phased – SMART

As an example a performance standard under the main KPI of Sales or New Business might read:

“On a weekly basis starting 1st November 2019, each sales person to identify 10 potential new customers in the technology sector who use products we provide. They should be within 50 mile radius of our London base. Prepare and send out a prospecting letter and follow up with appointment setting. Results and numbers of appointments set for each month to be presented at sales meeting at beginning of following  month.”

To get a detailed SMART document for all areas of the business takes time but without the work up front, performance management is impossible.

Step 2: Agree and share out the KPI’s and performance standards

Each person in every part of the business needs to agree and understand what they will be measured against. For many this will be a new way of working and they will be very suspicious of the process initially. The longer serving members of staff might say things like “I’ve been doing this for years without these measures. What’s wrong with what I am doing?”

You must not back down at this point. Plenty of reassurance is necessary here both to keep people on-side and to let them know that everyone will be managed in the same way.

Step 3: Set up a Monthly Action Plan (MAP) performance management process

This is the most important of all the steps. This is what transforms all of this process from theory into practical, usable day-to-day measures.

  1. On a set day each month – booked in the diary – get together for a short informal MAP meeting with each team member and agree the months activities.
  2. Review the KPI’s that they have assigned to them and highlight any areas for special attention in each KPI. These must be as SMART as you can make them. The meeting does not end until you have agreement that they understand and can do what is expected given their experience and abilities.
  3. As the manager you have responsibility to check on progress during the month to nudge people back on track, if necessary, rather than waiting to review failure at the end of the month.
  4. Copies of all MAP forms must be kept as these can be referred back to as evidence of achievement at future appraisals.
KPIMAP – NovemberWhat has
been achieved?
QualityPrepare a one page report on the recent dip in quality detailing how
to bring standards back up to the level required. Report ti include all costings, staff
allocation and timescales. To be on my desk by the 22nd.
AdminInput all customer data into the CRM system within 48 hours of customer visits. Bring
evidence to our next MAP meeting
FinanceAgree payment dates with at least 15 outstanding debtors by the 31st November

Step 4: Agree dates in the diary for each MAP meeting for the year

Ensure that all understand that the responsibility is theirs for completing these actions throughout the month. Let them know that you are there for support and guidance but not to HELP them i.e. buy it back from them or let them off the hook. They also have responsibility to flag up to you during the month if something outside of their control is going to prevent them achieving the task.

Step 5: Hold the next month’s MAP meeting

At the next MAP meeting the form is reviewed and what has been achieved is recorded. Praise any success and discuss failures.

Step 6: Continue Implementation and Follow Up

You have to ensure that you check up regularly to see that the activity that was agreed is happening and how close or not they are to the performance standards. You must also give feedback both during, and on completion of, the task. This feedback should include how their skills at hitting goals and targets are developing and how this helps them and the business for the future.

Key Points to remember: 

  • In starting the MAP process, play it in gradually
  • Have regular informal catch ups throughout the month to see how people are doing
  • Give praise and recognition
  • If people are falling behind ask why and get them to talk through what they need to do to get back on track
  • Don’t give in to people and let them off the hook or buy it back from them
  • Stick to your guns!

An effective performance management process is easy to understand – and less easy to implement! Follow these steps, keep your nerve and very soon your people will begin to appreciate the process because it gives them clarity on what they should be achieving and feedback on their performance. You as a leader and manager will also benefit because you and your people will be delivering better results! Isn’t that what we all want?

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