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Articles This Quarter:
Increase Your Business IQ in Just Three Minutes
by Mike Higgins, Jr.
One of the biggest problems I see with the volume of
information that comes at us each day is that most of it
does not “stick.” We see the data, but fail to “internalize”
it. I have a simple exercise that I expect every
organization using “STAKEHOLDERS” to perform each month …
The Payout Calculation Exercise.
Before you pass this off as just another task, please
slow down, and invest three minutes of your day to hear me
out. I guarantee that three minutes from now you will be
enlightened to the point of taking action (if you care about
your organization’s performance).
The value of the scorecard is that it creates focus on
the things you must do in order to be successful. The KPIs
(Key Performance Indicators) on your scorecard are your
de-facto business model and it is critical that you know
what the KPIs are, how they are performing relative to
expectations, and most importantly, how to influence each
one.
On the page that follows, there is a “blank” payout
calculation exercise. Inside of each branch or department,
assign the task of completing this exercise to a different
individual each month, on a rotating basis. For example, if
there are 12 people in a department, one employee would
complete the exercise and report the results to the other 11
department employees at a staff meeting. The next month, a
different employee would repeat the process.
Here is how it works and why it is important…
Step 1: Get a copy of your branch or departmental
scorecard. If you don’t have a branch or departmental
scorecard, then use the organization-wide scorecard.
Why: You need to know where to get the information from.
Step 2: Write the name of each KPI in the first column.
Why: If you have to write down the name of each KPI, you
will start to memorize them. That is the first step in
learning and internalizing the information. My mentor, when
I was a young golf professional, told me when teaching
students how to play golf, they had to hear the message
seven times before it “stuck” and they had to practice the
technique for 21 days before it became habit.
(By the way, a habit is an unconscious behavior or
action. Wouldn’t it be great if all of your employees were
full of good habits!)
Step 3: Write down the YTD performance of each KPI in the
second column.
Why: If you have to write down the YTD performance, you
will start to become familiar with the “numbers” associated
with each KPI and how it is measured. Some numbers are big,
some are small. Some are in thousands, some are in
percentages. If you have to write them down, you will become
familiar with the numbers. If you become familiar with the
numbers, you will start to understand them.
Step 4: Write down the YTD budget variance for each KPI
in the third column.
Why: You need to know where you stand relative to
expectations (budget) on each KPI. If you see that you are
behind plan on a measure, you might start to ask “why” and a
few good ideas might emerge as to how to reduce or eliminate
any unfavorable variances. The alternative (not doing this)
is the equivalent to sticking your head in the sand like an
ostrich.
Step 5: Write down the hurdle achieved in the fourth
column, the KPI weight in the fifth column and the product
of the two (the KPI score) in the sixth column.
Why: This is how the payout is determined. The greater
the KPI score, the greater the payout.
Step 6: Sum up the individual KPI scores to determine the
overall KPI score. Fill up the thermometer on the right hand
side of the worksheet to visualize how well you are doing
(just like a United Way fundraising thermometer).
Why: A picture is a great way to internalize results … no
numbers required!
Step 7: Fill in the reward pool along the right hand side
of the thermometer at each hurdle.
Why: This will tell you how large the reward pool is as a
percentage of base salary.
Step 8: Report the results on the worksheet to the
members of your branch or department. You don’t have to be
an elegant speaker to do this. In fact, you can regurgitate
the information verbatim if you wish.
Why: Studies have shown the retention level and
understanding of information increases exponentially when
you have to read it, write it down, and present it to
others.
I hope I have satisfied the guarantee I made to you at
the start of this article and you are moved to action. I
guarantee that you will see results in the increased level
of business literacy of your employees if you invest just a
little time and discipline to complete this task each month.
Payout Calculation Worksheet
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Improve Coaching Techniques with These Five Tips
Adopted from Smart Supervision
David Peterson and Mary Dee Hicks, senior vice presidents
at the Minneapolis-based consulting firm Personnel Decisions
International, offer the following suggestions for using
coaching strategically in your organization.
1. Provide coaching where the payback is greatest.
Many
organizations offer coaching on request or as a perk, not
necessarily where it can provide the most business value.
Use coaching when:
• You need to accelerate growth of
people in critical assignments, or there is a significant
increase in the complexity of someone’s work;
• Risks are
high and you can’t afford a failure;
• An executive’s time
is precious and every minute counts.
2. Build a pool of coaches you can count on.
Screen
coaches to ensure they can effectively meet your business
needs. Once you’ve identified good coaches, familiarize them
with your organization’s culture and business realities to
align them with your strategic priorities. Once the coaches
are established with your organization, continue to gather
feedback about their effectiveness.
3. Evaluate the coach’s ability to help people learn.
Good people skills and a genuine desire to help do not make
an effective coach. Good coaches can translate good ideas
into new capabilities and stronger performance.
4. Match the coach to the need.
Often, organizations
match a person to a coach based on age, gender, ethnicity or
personality. However, it is more important to find a coach
capable of addressing and individual’s specific challenges.
5. Set objectives and evaluate results.
Coaching is not
just about providing support. Ultimately, coaching should
deliver what every business needs – real results.
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Best practices
Last fall Rock Valley Federal Credit Union in Loves Park, IL
implemented the “STAKEHOLDERS” program. They chose our new
remote approach for implementation. This implementation
approach is done by means of e-mail and telephone
conferences. Rock Valley shared with us the following as to
how they have communicated “STAKEHOLDERS” to their staff.
After we signed on with Mike Higgins & Associates we
investigated everything we could on the MHA website for
training. We found the Implementation workplan, part of the
coaching manual, and the Business Model handouts very
helpful. We took these presentations and made them our own
to communicate our mission and vision so staff could see how
“STAKEHOLDERS” was part of the bigger picture.
We provided staff an overview of the program along with our
2008 Key Performance Indicators (KPIs) that included
specific examples of things that affected these areas. We
created a Stakeholders binder for everyone! Each employee
has a 3-ring binder which includes several handouts from the
kick-off meeting and then each month they can put their
monthly reports in it.
We created small groups (no more than 8 people) so that we
could meet as interdepartmental groups and discuss each KPI.
Each small group has a Team Leader which is a member of
management. This allows us to get more ‘hands on’ and offer
assistance if someone is not onboard. We feel getting them
engaged requires reaching them at multiple levels. Each
small group is asked to have someone be a Scribe, to gather
the ideas generated, and then someone is a Presenter. The
Presenter’s job is to share a few of the ideas the group
generated at our all staff meeting.
Our first small group assignment was to discuss the KPI’s
which were relative to Savings . . . this accounts for 40%
of our 2008 plan. We had some GREAT ideas generated out of
these small group discussions. These ideas were then
summarized into four categories and the Manager of that area
gave a presentation at our all staff meeting. The employees
enjoyed seeing their ideas in print and hearing management
give the kudos and a call to action on a good portion of the
ideas.
In our all staff group meetings we provide the employees
with the Stakeholders reports for the previous month. We
also choose one or two Plan-Do-Check-Act topics to discuss
with the staff. Each month we also have a Product Knowledge
topic presented by our Training Coordinator. Our meetings
are jam packed with information. We want our staff to have
the knowledge necessary to help RVFCU continue to move
forward.
We’ve explained that this program is not just about a payout
. . . it’s about learning and understanding what the CU
business model is, increasing their business acumen, and
having knowledge outside their daily area of expertise. It’s
EVERYONE’S job to promote the credit union. To be that
advocate you have to get engaged . . . we’re offering them
the knowledge but it’s up to them to jump on the bus. We
know that some people will not, but we’re attempting to give
them every opportunity. The managers and peer-to-peer
accountability factors are increasing which is required to
see a change in behavior.
Thank you to Anita Countryman at Rock Valley Federal Credit Union for
sharing with us how they got “STAKEHOLDERS” up and running
after implementing the program remotely.
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Welcome New Clients since our last
announcement!
Max Credit Union
Montgomery, AL
University of Kentucky Fed Cu
Lexington, KY
U.S. Fiduciary Services, Inc.
Lisle, IL
Pelican State Credit Union
Baton Rouge, LA
Skowhegan Savings Bank
Skowhegan, ME
Hawthorn Bank
Lee’s Summit, MO
Civic Bank
Nashville, TN
Brattleboro Savings & Loan
Brattleboro. VT
Eurobank
Hato Rey, Puerto Rico
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We Have Moved!
Please take note that as of June 1, 2008 our business
address will be:
8080 Ward Parkway, Ste. 100
Kansas City, MO 64114
Our Kansas City office phone number will remain the same:
816-753-4104.
Please update your records with this new address for all
correspondence.
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MIKE HIGGINS & ASSOCIATES, INC.
