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The Model Corporation: Part Five. Managing Total Performance Properly

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We have been following so far in this series of six articles the building of a model corporation; one that is a small lowerarchy; is owned, governed and led responsibly; and has an uplifting culture. In this fifth article a final feature is added. In the model corporation and in a real corporation if it is to be a great one, total performance must be managed and managed properly.

The Meaning of Total Performance

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Recall in Part One that corporate greatness was described by this outcome side of an equation (the left, input side being an interaction between situations and people):

              Consistently Positive Behavior + Consistently Positive Results

Notice that it has two components, not one. Total performance is not total if any treatment of it, whether simply in thinking about it or in doing something about it does not include behavior and the results or consequences of the behavior.

Recall also in Part One the list of incidents of corporations that pundits had anointed as great ones because of their sustained financial success. The incidents depicted undesirable, unethical corporate actions. The corporations and the pundits neglected one of the components. The unconventional bottom line of behavior can't be neglected anymore than can be the conventional bottom line of results.

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The Meaning of Managing Performance

Recall in Part Two that one of the bad premises of a hierarchically structured organization is that the primary meaning given to "managing" is its source, a manager occupying a managerial position. In a hierarchy managers manage their own careers and subordinates. In a lowerarchy managing is a process, not a person; everyone is a performer, not a manager or subordinate; what are managed are not subordinates but performance; everyone manages performance; and much of the process is simultaneously both individual and team self performance management.   

The Five Necessary Features of Total Performance Management

For total performance to be managed properly the process must have four features. Each are described briefly next. The first, total accountability is the most important and the other four flows from it.

1. Total Accountability. A minimum level of accountability is absolutely necessary for any business, or any society for that matter, to function. Corporate greatness requires the maximum level, that of total accountability. It is the overriding principle for properly managing total performance.

For there to be total accountability both behavior and results must be managed diligently throughout each performance period or accountability cycle. It must apply to every corporate member, no double standards allowed (in hierarchies CEOs get away with the most and worst wrongdoing). Each cycle must start with great expectations about performance because they are the standard against which actual performance is to be compared. During the cycle performance and its situations must be monitored neither too much nor too little. At the close of the cycle performance must be validly appraised and where appropriate or necessary, responsively and responsibly rewarded or penalized (penalties, of course, must be imposed in a timely and just fashion independently from the cycle's schedule).

Because the immediate result of a decision or action may and is often intended to trigger a series of further actions by others, the question arises as to when the initial actor's accountability stops. "The buck stops here" was President Truman's famous declaration. In general the more influence a person has over a decision and/or subsequent action or chain of actions that lead to more distant consequences the more that person should be held accountable for them (a lowerarchy, of course, without a leader perched umpteen layers above most everyone else has a shorter chain of consequences linked to the original decision maker/actor).

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In a model corporation of cross-functional teams, accountability for results is shared but accountability for behavior ordinarily is not. If a team, for example, fails to meet one or more team objectives, the whole team is accountable for the shortfall. But a team cannot behave. Behavior is an action of an individual. Individuals are accountable for their actions as individuals. However, in cases where any consequential behavior cannot be readily associated with any particular person, the whole team may need to be held accountable for the behavior (e.g., in the classical school room case where no one will tattle on the troublemaker).

2. Setting Great Expectations. With apologies to Charles Dickens, behind every great performance is likely to have been a great expectation. Great expectations, especially when self-owned so to speak motivate and guide people toward desired ends and not by using unacceptable means as would be the case with ignoble expectations (e.g., setting unreasonably high goals that knowingly can be met only unscrupulously). Setting great expectations is critical, because a poor start usually ends poorly.

Great expectations proscribe negative behavior and prescribe positive results (recall their definitions in the introductory article). Proscribing rather than prescribing behavior may seem an odd corollary principle, but it is not. It says be flexible about positive behavior and inflexible about negative (i.e., incompetent, unmotivated, and/or unethical) behavior. As for results, positive ones can often be met through a variety of positive means, each of which would be acceptable assuming there were no differences among them in terms of their cost and other considerations. Incompetent, unmotivated, and unethical means, on the other hand, should never be tolerated.

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Retired organizational psychologist.

Author of The Devil's Marriage: Break Up the Corpocracy or Leave Democracy in the Lurch; America's Oldest Professions: Warring and Spying; and Corporate Reckoning Ahead.

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