The head-spinning advances in technology, endless bottom-line financial pressures, and growing networks of global economies described earlier demand a need for superior performance and sustainable efficiencies. Organizations aspire to motivate their employees to be better, more productive, and more engaged. Leaders seek ways to create a common language behind which organizational goals and activities can align. What can replace the void that is being created by the slow demise of performance management systems? What is the new corporate currency?
“Value is when the outcome of a situation exceeds the cost incurred by a satisfactory margin.”
But what is a ” satisfactory margin”?
Margin is the difference between the amount of cost incurred and the benefit derived. Not all margins, however, are created equal. In order to experience value, the margin must also be satisfactory. For example, a manufacturer produces an item that costs him $10.00 and sells the same item for $12.00. So this item has a 20% margin (($12.00 – $10.00) / $10.00). This manufacturer may be very happy with this margin. But for another manufacturer, and for a variety of reasons, this margin may be woefully deficient.
In today’s “get-it-done-yesterday” business environments, tenure is shortening and relationships are becoming shallower. It’s no longer enough when an employee exceeds expectations. Herminia Ibarra, the Cora Chaired Professor of Leadership and Professor of Organizational Behavior at Institut Européen d’Administration des Affaires (INSEAD), reflected on this topic in a recent Wall Street Journal article. “With competition fierce and the business climate changing rapidly, companies are telling their leaders that it’s no longer enough to deliver results in their individual departments, or over the short-term.”
Are you not feeling that you have the support of your boss when it comes to joining an association? In a previous post we discussed the importance of balancing work and industry events and being open with your boss. Here are a few more tips for getting your boss’s support and for getting her behind your decision to join an association.
1. Identify the business performance drivers that are important to your organization. Brainstorm with a colleague, speak with a senior leader, or talk with someone in finance, sales, business development, or operations.
There is no greater activity to begin the process of raising the value you create for your organization than a conversation with your boss about value creation. By approaching your boss and requesting a conversation regarding value creation, you are already raising your value in your organization. Yet, at the same time, this is not a conversation being held in organizations across the globe. Hence, when responding to your request, your boss may be:
Take a moment to think about a key activity/project in which you are currently engaged. An activity tends to be smaller and completed on a recurring basis, while a project tends to be larger and done only once. An effective strategy in completing your value identification exercise is to find a colleague who can help you think through this important information. Think about the following:
The competitive global marketplace shows little mercy for organizations that are slow to raise the bar for their customers and their employees. Business value tied to external marketplace drivers tend to be strategically focused and is created by:
Like an adolescent transitioning to adulthood, growing and evolving organizations require value to be more tangible, and the contribution of business value by employees to be broader. While individual value is critically important to an organization’s performance and culture, it is not the type of value that will sustain an organization in its marketplace. Business value tied to internal financial drivers reflects a more strategic perspective that can have a positive impact on your organization. In today’s competitive marketplaces, your organization needs as many employees as possible focused on creating value through internal financial drivers.
When you perform your job well, you are valuable to your organization. When you are focused primarily on creating individual value, you tend to be in a role that is more tactically-focused. And let’s face it, some roles in organizations need to be tactically focused and this focus is very valuable to the organization. Not every role has a clear line of sight to financial performance, nor should they. At the same time, most organizations have yet to explore how roles, even the most tactical, can create value to the organization by exploring how individuals within these roles can impact financial performance. Not all value that is created has to be worth millions of dollars, or qualify for the cover of Time magazine. Even individuals in a tactical role or a group of individuals comprising a function can create value for the organization.