Check out Ed’s recent interview on Radio Entrepreneurs. Radio Entrepreneurs share the stories of entrepreneurs in the interest of giving more exposure to innovative and fast moving companies while creating a knowledge pool for the enrichment of the entrepreneurial community around the world.
Growing 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, it is not the type of value that will sustain an organization. Business value tied to internal financial drivers reflects a more strategic perspective that can have a positive impact. Today, 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. This focus is very valuable to the organization. Not every role has a clear line of sight to financial performance, nor should they.
In order for an organization to obtain value from you and for you to raise your value in your organization, you must capitalize on either an existing way of creating value or identify new ways to create value.
In the Raise Your Visibility & Value model, value is defined as the outcome of a situation when the outcome of a situation exceeds the cost incurred by a satisfactory margin. Raising your value is defined as performing activities that connect individual contributions with business performance. To be considered a valuable employee, you must tie as many of your activities as possible to how your organization measures how well it’s performing. For most organizations, business performance is predominantly measured through financial performance. As you work to create value for your organization, you must focus your activities on your company’s financial performance.
There are many types of organizations in the world. Whether you work for a non-profit or for-profit, a manufacturer or a service provider, a “bricks and mortar” or virtual company, you work for an organization that needs to survive in a very competitive, fast-changing, and complex environment.
All organizations operating in complex environments are impacted by external and internal forces. Externally, your organization needs to raise capital in order to invest in its growth and generate revenue to cover its operating expenses with vendors and employees. In order for your organization to obtain capital or generate revenue, it needs to create value for investors and customers.
Deep within the heart of your organization’s cubicle farm, you and your heads-down colleagues are working hard to stay employed. Our metric-based culture has created generations of individuals who believe that good performance alone ensures job security. They still haven’t figured out the dirty little secret behind value creation.
While it is inevitable that the dreaded performance appraisal will cease to exist in its current format, some form of performance measurement will continue to exist. One reason is that roles where value creation falls into a category called “individual value” will need a performance management system to measure how foundational activities impact the organization.
So what is it that will make you stand out to your boss or organization as a valuable employee? When I say that you must achieve more than just doing your job well, I am not suggesting that doing your job well is not important. Conversely, in today’s excruciating work environments, good performance is expected. Your organization is finding less time and spending less money to train you to be a good performer. In her recent Wall Street Journal article, Herminia Ibarra of INSEAD continued to reflect that “Businesses are putting managers in a tough spot. They’re forcing bosses to take on many new responsibilities – but they’re not training them to get those jobs done.”