Remaining in Focus

Financial metrics are, of course, an important means of measuring employee performance and success. However, in today’s business climate focusing on the long term alone isn’t as simple as it once was. With employees changing jobs every couple of years, they are motivated by what’s in the short term rather than the long. In the past, a company’s long-term goals usually matched with employees’.

What’s the best way to choose a set of employee performance metrics that help align the interests of employees and an organization? How can the focus remain on long-term metrics that contribute to a company’s success, while also taking into account the factors that motivate employees?

When creating your Balanced Scorecard, a strategic management metric used as a tool to measure success, there are ways you can craft goals to achieve long-term success - even in today’s nearsighted environment.

The KPIs you select can help dictate success. KPIs should be present at all levels, and be comprised of a mix of “big” and “small” goals. This includes goals for individual employees, departments, and the entire company at large. Because smaller (individual or departmental) goals are easier to achieve, they provide quick and satisfying wins. These wins allow employees to feel in control in the near term, more so than the longer-term corporate-level wins. Short term wins help motivate people and increase productivity. The larger goals help align the organization and propel it forward, which is also necessary. Thus, smaller goals can stack up to contribute to larger goals, and a company’s success can trickle down to everyone.

Embrace the Goldilocks Mindset

Having the correct number of measures is a key to success. Too many measures can be detrimental, as can too few. While there is no one-size-fits-all solution - the “correct” number will vary upon an organization's size and goals - measures should be challenging, yet attainable. All measures should fall within an optimal level of difficulty.

“Humans experience peak motivation when working on tasks that are right on the edge of their current abilities.”

Align Scorecard to Strategy

One size does not fit all. Your Balanced Scorecard must be customized, and there is no single prescribed way to do it. When creating the scorecard, be sure to stay true to yourself, your brand, your market, and your goals. Your scorecard shouldn’t be incongruent with these things. There is no one formula for the scorecard because, just like anything else in business, there is no one formula for success.

Be Ready to Tweak the Scorecard

Your first scorecard doesn’t have to be the final one. It’s important to realize you cannot have every single thing you want, nor all of your goals met at once. Realize that tradeoffs might have to be made and you will likely learn from things that happen along the way. Whether you encounter a stumbling block or unexpected challenge, don’t look at it as a failure but instead an opportunity to improve. Something on paper might not work as well as how it plays out in ‘real life’ so next time, do something differently.

Although today’s employees are focused on the short term, it is possible to motivate employees while maintaining alignment with an organization’s long-term goals. Using the tips above, you may create a scorecard for measuring employee performance that effectively propels your business towards success.