Pick your favorite professional team sports franchise–football, basketball, baseball, soccer, etc. Here in Atlanta we love our football, so let’s imagine that the Falcons take the field in an important game with much excitement and fanfare. They give it all they have, but they’re not only beaten, but crushed by their visiting opponent. Why the heck did this happen?
Let’s do a One Minute Performance Quick Check. BTW, by no means is this meant to be a scientific formula; it’s meant to be a method to think about the main levers that you can pull to get better performance from your business. We all get so caught up in all the moving parts of business sometimes that we lose sight of the big picture and what really matters most.
Once you have a product that people are willing to pay for, financial performance becomes about the quality of your people and processes. Here’s the formula.
Individual Performance X Team Performance = Financial Performance
Since we can all agree that business success is defined by leadership trickle down (don’t we?), let’s focus on your Senior Leadership Team.
Individual Performance: Out of 100%, what percentage of A Players do you have in your Team (including you)?
- A Players: the real pros, top 10% performers in their positions (e.g., a franchise Quarterback)
- B Players: great college players who are above average performers in the pros
- C Players: great high school players who did well in college but are average performers in the pros
Team Performance: Out of 100%, what percentage of teamwork do you have in your Team (including you)?
- Clear goals and roles
- A communication plan that gets everyone the information they need when they need it
- An effective reward system (compensation and culture)
Our experience has been that these two performance factors influence each other more than just in an additive way, so we multiply one measure by the other. For example, if you have a strong team but poor teamwork, then your team’s performance will suffer. By the same token, if you have strong teamwork but a weak team, then your team’s performance will suffer also.
Example: What if our imaginary Falcons team had:
- 70% Individual Performance (e.g., some A Players, some B Players, some C Players) multiplied by
- 70% Team Performance (e.g., the General Manager and Coach have different philosophies)
- Equals 49% Financial Performance (yikes! I fear we may have a High School level team here)
Great news; in this example we have lots of opportunities for improving financial performance! Imagine what would happen to your financial results if you got more A Players in the skill positions (either through the draft, role fit, or coaching); and at the same time you improved teamwork (through reducing ambiguity and improving your communication and culture)!
What is your Financial Performance percentage score? Remember, this isn’t intended to be something you can show your accountant, but a way to think about the major levers you need to pull to improve business performance.
If you’re not getting the business results you want, it could be that you’re sending a College or High School team up against the Pros. If so, what’s holding you back from making the changes you need, Coach?
- Conduct a realistic assessment of your team and it’s performance (which is more difficult than it may sound).
- Attract and retain as many A Players as you can in your skill positions.
- Insure that you have a high level of teamwork in your team so everyone’s not running around the field willy-nilly.