Parifornia

Original insights in international business and marketing

When is Exceptional Performance Not Exceptional?

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When business is doing great, everybody looks like a star.  Over several years, however, people can come to believe that their personal contributions or the combined efforts of their department (e.g. Marketing) are directly responsible the success.  While this can be true, it isn’t ALWAYS the case. The point of this article is to point out that for Marketing in particular, a great deal more needs to be done to demonstrate that business results are in fact being driven by the right mix of strategy and execution.

The fact is that activities, projects, participation in meetings & workshops, trade shows, travel and all-around busy-ness, do not always create meaningful results, namely incremental revenues, higher margins/EBITA, etc…  While we tend to associate busy work with exceptional performance, the two are not necessarily related.  In many ways, far more can be achieved by making a few impactful decisions (the right ones, obviously!) than through sheer hard work.  The reverse can be true too.  All the good-will, effort and hard work can’t always undo the negative impact of a handful of bad decisions.

The challenge, therefore, lies in finding the direct link between work/effort and incremental business results.  Setting the right strategic goals and – above all – selecting the right performance metrics are quintessential steps to track and measure exceptional performance, be it at a group level or a personal one.

Below are 5 reasons for incorrect attribution of exceptional performance which may mask deep inefficiencies:

  1. Using the wrong or no metrics.  In some organizations, testimonials and personal references from a few key and influential people is sometimes all it takes to create a perception of stellar performance.  While these are certainly positive indicators, they can be gamed and they do not necessarily constitute objective and reliable indices.
  2. Goals & expectations set too low.  Performance benchmarks that are set too low are all that is needed to create the perception of performance excellence come review time.  In some environments, doing just a bit better than the other guy may be enough to look like a real performer.
  3. Business is on an established growth path/cycle.  Maybe because of the early stage product life-cycle or the small size of the business (in an emerging segment), growth may occur almost on its own.  Think of when a government mandates a certain technology and you happen to be one of the only companies that makes it.
  4. Distribution expansion.  International expansion, for example, can also drive business growth almost by virtue of having a presence in new markets.  The business probably needs just a little babysitting and oversight to keep growing.  But is this exceptional performance that any individual or group (save, perhaps Sales) can claim as a direct result of their hard work?
  5. Multiple contributors.  Other factors/groups such as Sales, IT, Supply, R&D or Service may play a bigger role in driving the actual business results.  I’ve seen instances where the sheer brilliance and superiority of the product kept a business thriving for years in spite of spotty sales support and mediocre Marketing.  In such instances, if business groups each use sales growth as a key performance metric, then everyone looks like a rock star in spite of uneven contributions.
Its a good idea for businesses to implement stricter guidelines for setting the right metrics to measure real performance contribution to the bottom line.  Instead of using classical performance metrics like sales growth or revenues, perhaps its time organizations turned to different, more targeted metrics.  Here are a few suggestions:
  • Number of Qualified leads generated
  • Lead conversions/rate
  • Sales Team satisfaction indices
  • Indirect channel partner surveys
  • Customer lifetime value
  • Customer retention
  • Brand awareness & perception scores
  • Purchase intent metrics
  • Number of meaningful customer interactions
  • Unique website visitors
Only once such metrics are in place can Marketing departments and individuals be credited with true performance excellence.
Thoughts, ideas, emotional outbursts?  Leave a comment or simply follow the Parifornia blog (Original insights in international business and marketing).

photo credit: ktpupp via photopin cc

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Andrew Hyncik

Andrew Hyncik

Parifornia is the creation of Andrew Hyncik, an experienced International Marketing executive who's lived and worked for over 20 years in both Europe and North America.

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