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In this series of talks,
we've looked at a number
of issues from technical,
how to gather good data,
and how to create good
performance indicators and
appraisals and so on, to
more behavioral ones.
But very often, of course,
there is a cultural element,
that shapes and
influences and is
influenced by the ways in
which we measure and
manage performance.
I'd like to share a quote with
you from an interview that was
done with the previous CEO
of Ford Motor Company.
In this presentation,
I want to just
cover one bit around the culture
and what kind of issues
the CEO, Alan Mulally,
had to face when he joined
Ford in the mid 2000s.
Let me read this quote with you.
"When I joined Ford, there was
a good chance that the company
would go out of business
if we couldn't
improve performance.
That created tremendous urgency,
but I also had to be patient.
When we first
started doing weekly
business-plan-review
meetings at Ford,
we got 300 charts
from the executives
participating in the meeting
- and all of them were..."
Now if you look at this
part of the quote,
you see how the
situation is critical.
This new CEO is joining a
large company, that is doing
badly, and receives
a lot of charts,
performance information if you
want, from older
senior executives.
Of course, you would imagine
that they would be red,
in the sense that they would
show underachievement.
In fact, the quote goes
on, and they were green.
The reason is that people were
afraid to admit to problems,
particularly if they
didn't have solutions.
This is a key point.
If we work in an environment
where people are afraid to admit
to problems and
there is a sense of
blame whenever we don't
achieve something,
everybody wants to show
greens ("inverted commas"),
showing that there
is good performance,
then it's very
difficult to improve.
It's very difficult to use
the performance
information that we
get through the systems
that we've talked about
in this series of talks,
it's very difficult for
that information to make
a positive difference.
A way to summarize this
is to really think
about that we want to
move from a culture
of proving something - showing
that we're doing what we're
supposed to do - to one that is
more related to
improving something.
This cultural shift
is very difficult.
At Ford it took years, in many
companies it takes a long time,
but we need to do that.
Otherwise, most
of these systems,
would be there to just
show the things are fine,
even though overall,
clearly, they're not.
You can think about this
at different levels.
You can think about this at
the level of individuals, where
individual performance
seems to be very positive,
but collectively, we see that
the team is not working well.
You can look at
different functions or
business units in
an organisation.
Then if everybody
is showing greens,
it doesn't mean that
the overarching picture is green
too, as in the case of Ford.
You can look at this at
the level of the economy.
If you think about anything to
do with environmental
sustainability,
you will know that things
are going badly when
you look at the so-called
planetary boundaries,
for example, in terms
of biodiversity,
and greenhouse gases, and so on,
but then when you look at
individual company reports,
they all seem to be
doing really well.
You can call this greenwashing,
but it's certainly one
of the problems that
we have, where pretty much
every organisation is showing
their green credentials,
so to speak,
but then when you look
at this overall issue
really doesn't look like
a positive picture.
One of the reasons for this,
at whatever level where there is
the organisational,
individual or society level,
is that we often tend to
think about leadership
and the use of these
systems to measure
managed performance
in a way that doesn't
necessarily lead to
positive results.
So let's look at
what leadership is
not in the context of
performance management.
