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UK Construction Media speaks with Rod Horrocks, Director of H3 Partners, about the challenges associated with keeping process in-check and the vital role incentive plays in measuring performance.
While Performance Measurement has proven invaluable, many businesses struggle to maintain best practice over long periods of time. In H3 Partner’s experience, how often should organisations be revisiting their processes to ensure that performance remains optimal?
As you know, most businesses will budget annually by department – perhaps with a top line and a cost line for sales. The same should be done for process performance. Businesses should always reset their targets every 12 months as a minimum.
At H3 Partners we prefer this to be a continuous process so that every six months, once you have reached a target initially set, the target can be reset. You might say “Okay, we’ve done that. Do we think there is more that we can do?”
There are three targets – the idealistic, the minimum and the exceeding expectation – and these should be reset on a regular basis. 12 months is a minimum, and if a target is hit three months on the trot it’s time to reset the target.
Speaking generally, do businesses lack the necessary infrastructure to improve their processes?
There’s always enough resource if you put the process in place and empower the guys to do it. If you provide enough time for the frontline staff to agree on the performance measures and then implement a simple weekly review process that focuses on the exceptions and promotes improvements.
This works on the shop floor, but in construction you would have to work quite hard to do the same because you have to create a space that is at a premium. You can still get the guys together to ask how the week has gone however, even if it’s on a whiteboard with everyone gathered round over a cup of tea. Ensure that time looking at performance is enshrined in weekly tasks to review performance and to identify the issues effecting it.
Is it difficult for businesses to make those positive changes stick in the long term?
Again, if you empower the staff and they get something out of it – no. Obviously, if you’re doing this from the top down then the answer is yes. As we have said in earlier interviews, using performance measures to beat up on front line staff is counter-productive and unsustainable. But if you’re actually in a position to set the measures and give performance related incentives so that there is a personal benefit, then it is self-sustaining. People become engrossed in the ability to manage their life at work. Everybody wants that ability to manage any change, which is in modern day life is inevitable, but they don’t want it to be managed by their bosses without their input.
How can the introduction of new technologies – IT infrastructure for instance – impact performance?
The only way this ever works is when technology is ‘pulled ‘by the user as they can see a benefit. Most of these technologies relate to IT, and though staff are familiar with these technologies they will need selling in how it can improve the process for that staff person. Again, it’s back to personal benefit.
The selling process should include the key element of training, so that they have the skills necessary to implement new technologies effectively. Simply put but you’ve got to get someone to pull the technology. You can’t push it – it might work but not effectively
Ultimately, it’s about being honest and upfront. These are the benefits of any change, explain why this is happening to these processes and here are the skills needed to be enable your staff to use the system effectively. People will have optimised their own operations and if they have been in the job for more than 12 months then they will probably have become reasonably effective at doing it. When changes are made, it can be a real pain for them. You have to articulate the benefit.
In your opinion, is the construction industry doing enough to scrutinise process over long periods of time?
No, I don’t think so. They don’t take the time to understand what the back office looks like to make the front end – i.e. how things are built – work more effectively. I think they have just accepted that there is not much that they can do about it. Even people with static operations, perhaps with factories and offices, still don’t spend enough time looking at process.
From your perspective, would you approach an SME differently to a top tier contractor?
The tools are the same but the approach is the different. The difference is that there is normally a smaller group to get motivated and engaged from an executive point of view. They can have their own nuances because small companies tend to be privately or family owned which provides its own dynamic in terms of change and the reasons the company exists. But the tools are much the same because process is process. It doesn’t matter how big or small a company is, and in fact small companies can be more complex than larger ones because bigger organisations are usually broken up into divisions with a smaller focus of activities being undertaken. The process footprint, though big for the whole business, can be quite small in individual units. If an SME is making, selling and supporting something their process footprint can be huge.
For more information on how H3 Partners can improve your business please visit the Company’s website or download H3 Partners’ Performance Measurement e-Book.
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