To identify business skills required in your business, meaningful measurement of performance against goals is a must.
And measurement isn’t just used to identify skills gaps – it can also be used to review the effectiveness of any training undertaken, says David Osborne, Managing Director of Profitable Personnel, a Perth-based employee performance and selection company.
“I’ve got a very strong philosophy that all training should provide a 10-to-one return on investment,” says Osborne.
“If you know your productivity numbers and you’re not getting that return, then training probably hasn’t been effective”.
Goals
Before you can start measuring business’ performance, you first need clear and realistic goals for each division of the business that align with your corporate goals.
“You can’t train someone effectively if the position goal is grey,” says Osborne. “Most businesses I’ve seen have about 40 per cent of their goals reasonably clearly articulated and the other 60 per cent are grey.
“A company that is not 100 per cent crystal clear about what needs to be achieved in each area of the business will have disengaged employees and suboptimal performance. A team without goals cannot obtain one of the greatest rewards from their work – knowing how well they’ve done, which directly leads to job satisfaction.”
He says it’s critical that the ‘six pillars’ of an enterprise – marketing, sales, production/service, aftersales, income recovery and management – have business goals.
To achieve goals, several key things are required:
- very clear, effective and up-to-date processes to achieve each business goal
- delegation of someone competent to execute the process and
- regular measurements of performance.
Measurement
Managers need to look at their productivity figures to see what their staff are able to achieve. If a section of the business isn’t achieving a goal, the manager needs to investigate why.
The cause may be a lack of staff competence or commitment, market conditions or even the way an employee is feeling about themselves, which is reflected in the culture.
Osborne recommends a weekly review of measurements to keep the business agile and responsive. He suggests measuring productivity per employee, profitability per employee.
Training
Specific training: If you know what change is required in your business, you can be specific about what training is required to support that change. Osborne recommends finding a trainer who can provide information that’s specific to what you need to know.
“Putting a lot of general information in front of somebody and expecting them to filter out what they don’t need is not the way it’s done these days,” says Osborne. “People don’t have enough time to do that.”
Competence: Osborne makes a distinction between training and true competence. Training can provide an understanding of what’s required as well as ‘one-time competence’. However, conditioned competence ensures a person has the right attitude to achieve the process when things are not working.
A manager is responsible for conditioning their employees by giving appropriate feedback and retraining if goals are not being met.
“If something’s not working out, the attitude should be, ‘OK, let’s observe what’s happening, let’s reflect and learn and make changes’,” says Osborne. “That’s the attitude I’d want anyone to have who is operating a procedure nowadays. That’s true competence.”
Purpose: While you’ve got to train towards competence, you’ve also got to do it in a way that has a purpose and meaning. “Otherwise, you won’t get the return on investment – we’ve seen that time and time again,” says Osborne.
“Your business management plan needs to include a purpose. You can have a vision, but it’s really not as important as purpose. Your purpose is something like a campaign. If people don’t have a purpose, they’re not happy.
“It’s the purpose that makes happiness, and that straight away impacts the culture of a business. If the business owner can’t give you a purpose, then they’ve got a problem.”
Values: If the values of the organisation are not articulated in training, then you’re likely to have a culture that’s dysfunctional.
“If you don’t communicate your values, you’re actually conditioning people not to believe in those values,” says Osborne. “You’re conditioning and condoning the opposite of those values. You’ll then end up wondering why you’re not getting what you want.”
Which trainer: The value of a training provider will be always the results they’ve achieved, not their qualifications, says Osborne: “If you wanted someone to give you guidance to win an Olympic gold medal, you’d probably want a coach who’d have achieved that before with people.”
Continual improvement
The achievement of your goals first starts with clarity, then great communication and training. There’s no magic number as to how much you need to spend on training – it really depends on the type of training required.
However, even in hard times, when it comes to making a decision about investing in training, it’s important not to undervalue the impact it will have on your business’ ability to grow and adapt.
CCIWA offers a range of training courses.
