The head-spinning advances in technology, endless bottom-line financial pressures, and growing networks of global economies demand a need for superior performance and sustainable efficiencies. Organizations aspire to motivate their employees to do better, be more productive, and get 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 creating by the slow demise of performance management systems?
The answer is value creation. The language being used to define success is slowly and quietly shifting from performance to value. If you listen, you can hear “value creation” everywhere. I’ve been listening. I hear recruiters talk about the importance of creating value. As one recruiter said at a panel I attended, “Don’t tell me what you did. Tell me the value you created for your employer. Tell me how you made a difference.” I hear entrepreneurs talk about ensuring the products and services they aspire to bring to market create value in ways that don’t currently exist. At my Apple iPhone orientation, an Apple employee enthusiastically espoused that “the thousands of apps that you will now have access to will add value to your life.” The good performance of the iPhone was assumed – it was the value of the apps that excited him.
How does value exist within your organization? Has a conversation about value begun? Does your organization realize it has overinvested in performance management and underinvested in value creation? Whatever your situation, value is the new corporate currency. It is the vehicle upon which the exchange between individual contributions and organizational rewards is occurring. Slowly and quietly, numerical and bell curve-based performance management systems are being shipped to the scrap heap as business leaders seek robust and meaningful ways to increase individual contributions.
Measuring the value that you create for your organization is gaining your boss’ attention. Why? Value requires a foundation of good performance, ties your performance to business objectives and financial metrics, and creates a new way to motivate and align you in ways that are more rewarding for everyone involved.