We now turn to the issue of reporting progress and performance.What is the problem?
The effective management of any organisation involves some degree of planning, which will include an estimate or forecast of how long a specific scope of work will take, how much it will cost, the level of quality expected etc. Assessing performance against this requires the measurement of work done (and budget spent, quality achieved etc.) and comparison with the planning forecasts, with the results of these calculations often known nowadays as ‘metrics’.Well-defined and designed metrics allow management to add, remove or otherwise adjust resources in order to achieve the desired outcome. Poor metrics obscure the true state of progress, thereby preventing effective remedial action. Often, poor reporting stems from the organic, uncontrolled growth of metrics (as opposed to a deliberate strategy) and a failure to ensure their continued relevance.
How does it manifest itself?Organisations that do not report on progress and performance effectively may be unclear on ‘what good looks like’, leading to unambitious or unrealistic targets alike; there may be aspects of performance that simply don’t get measured at all, leaving management blind to issues until they become unwieldy and have an impact far greater than at inception (e.g. sickness and absence); confusing comparisons between work done and work planned (as opposed to actual work needed) may lead to false feelings of confidence; finally, irrelevant or out-of-date reporting can lead to reports that are far too long, within which it is no longer possible to find key information without excessive effort.
What is its impact?Poor progress or performance reporting leave management with limited situational awareness, thereby unaware of what is actually going on; this may mean certain risks do undetected, let alone managed. Remedial actions are often inefficient and expensive, pushing up overall costs and are taken too late to have the desired effect within the timeframe of any original plan. Furthermore, opportunities (such as replicating good practice throughout the wider organisation) may be missed, as the better performance derived from such innovations goes unreported for too long.
Ultimately, inadequate reporting mechanisms lead to a loss of credibility for all concerned, negatively influencing employees, partners, investors and regulators alike.What recommendations are made to address it?
Unsurprisingly, companies that learn, through lessons capture sessions, how inadequate reporting mechanisms have compounded poor performance, often decide to conduct a performance management review, to examine which areas require metrics and what kind of information will be needed and at what frequency.Linked to this, some organisations review governance and accountability, offering those doing the work (i.e. team or individuals) an input into how it is monitored, since they will know which aspects they use to gauge their own performance.
A further recommendation is for the encouragement of greater sharing of good practice from those teams whose performance is above average to those whose performance is below average. This requires a revision of incentives and, above all, the use of a KM framework, about which more information can be found at the Knoco website.