Expert Interview – Andrés Felipe Molina Orozco, Director and Consultant, Tracest Consulting Group, Colombia
For the report Performance Management in 2013, The KPI Institute conducted 20 semi-structured interviews with practitioners, academics and consultants from 18 countries, who provided rich insights into the state of Performance Management as a discipline.
One of the most important editorial rules followed in the development of the content is that a discipline can only evolve through the combined efforts of practitioners, academics and consultants. Andrés Felipe Molina Orozco, Director and Consultant of Tracest Consulting Group, Colombia was one of the consultants that The KPI Institute has interviewed.
1. What does the term Performance Management mean to you?
Performance Management is a business model which manages a number of tools that organizational leaders use to measure and to increase the motivation of employees, who therefore understand the importance of their role in the productivity of the organization.
Although Performance Management may be seen as a theoretical model, it is a way to modify the behavior of the members of the organization to achieve greater results. It is a way of creating an organization governed by principles rather than by rules, allowing each of the coworkers to make their job the best they can without hierarchical boundaries.
2. What drives interest in Performance Management?
Performance Management should be based on showing the importance of each role in the organization in achieving the strategic objectives.
The interest of a company that uses Performance Management should be the human development of employees in order to achieve economic development of the organization.
3. What are your thoughts on the relationship between Performance Management at organizational, departmental and individual level?
The relationship between organizational, departmental and individual level must be clear and consistent, individual goals must be raised so that it becomes easy to understand how a role is crucial in achieving the objectives of the department and of the organization.
For so long, the organizations have based their performance on fulfilling tasks and functions to deliver a service or product. This worked for a while at the local and regional environment, with little access to the globalized world. However, at present, any discipline, service or product is easily imitated, and then the differentiating factor will be based on the behaviors of organizations’ members. It is at this point where the Performance Management gets its real value.
If the performance of individuals is according to the departmental goals, and the performance of each department is consistent with what top management is committed to, sustainable results will be achieved.
4. What are 2013 key trends in Performance Management from your point of view?
In 2013, the organizations have continued to redefine their measurement models to create better internal customer’s experiences. A great internal customer’s experience generates the ability to deliver a unique and positive experience to external customers.
Therefore, Performance Management has been designed to establish the link between individual performance and the achievement of the strategic objectives of the organization. It can be seen as the bottom line of the Balanced Scorecard throughout the organization.
5. What aspects of Performance Management should be explored more through research?
Individual aspects should be explored more. Organizations must understand that they are made up of human beings who are moved by emotions rather than by reason.
In addition, the Performance Management must recognize the context of each organization, especially organizations developed in families environments. Conflicts that do not allow a high performance in family businesses are very different from those in companies that are not managed by family members.
Family businesses are the basis for developing economies and, therefore, this should be the new focus of Performance Management.
6. Which companies would you recommend to be looked at due to their particular approach to Performance Management and subsequent results?
In the case of Colombia, and more specific, the region in which I work as a consultant, a great example of Performance Management achievement are Telecenter Panamericana (Subsidiary of DirecTV) and Carval of Colombia.
These companies have made a difference in the behavior of their members, which has led them to achieve exceptional results, expand their operations and be considered great places to work at.
They have succeeded in defining the roles of their employees so that everyone knows how to achieve their best performance and deliver the best results in a sustainable manner.
7. Which are main challenges of Performance Management in practice today?
The biggest challenge in Performance Management is the fear of change, fear of taking on new administrative practices that challenge the type of management that organizations had.
Managers who take on the challenge of cultural change in their organizations and have the patience to wait for results are scarce. Boards should also have confidence in their managers to meet the challenges that Performance Management has.
8. What do you think should be improved in the use of Performance Management tools and processes?
Human irrationality should be taken into consideration. People base their behavior on emotional reactions, every day is different in the way we treat customers, and each customer is different every day.
Therefore, to achieve success in the development of Performance Management models, teams’ and departments’ Balanced Scorecards must consider how the members of the team will react to their tasks.
9. What would you consider best practice in Performance Management?
Practices that can be relate work environment, sales and development of employees.
An organization must ensure to be focused on development for the people working in it, must allow each employee to deliver their best performance every day, and at the same time, it must allow each employee to improve their skills and knowledge day after day.
This generates best teams and people willing to deliver the best to the customers, as well as compact teams with similar values and beliefs, that allow low levels of personnel rotation and costs low of training.
Therefore, an organization with good Performance Management practices must deliver excellent business and financial results.
10. Which aspects of Performance Management should be emphasized during educational programs?
The emphasis in education should be the human character of organizations.
The training of the organizations’ leaders must provide the tools to understand that performance is guided by the understanding of the employees and the importance of their role in achieving strategic objectives.
11. Which are the limits in order to achieve higher levels of proficiency in Performance Management among practitioners?
The limits are drawn from the perspectives of senior management; it all depends on the direction the organization wants to go and in what time.
The most important is the commitment of the board and members of the organization to be patient to achieve long-term results.
12. If you are to name in few words the main aspects governing Performance Management today, what would they be?
An organization must be prepared to answer the following questions:
• Individual Aspirations: What do I want to be? When do I want to be? Why do I want to be?
• Departmental Wishes: What do we want to be? How do we want to be? Why do we want to be?
• Organizational Fears: What do we want to be? How do we want to be? Why do we want to be?
Leaders must gain an understanding of the aspects that motivate each members of the organization and each team.
13. As a consultant, what are the most common issues that your customers raised related to Performance Management?
The biggest problem I find with my clients is that they have tried to establish the model of Performance Management guided by unsuitable texts and unprepared people. This has led them to have beautiful theoretical models but evil practices. Unfortunately, for this reason, the Performance Management models have lost credibility within senior management of companies.
The leaders of the organizations must be able to adapt the models to the reality of their company, the surrounding environment and the mission statement of the company.
If handled properly, Performance Management can be the best ally of a successful organization, but if handled improperly, can be a great enemy in achieving strategic objectives.