How to Deal With Disappointing Performance Metrics

1

Good business leaders try to tie everything to objective metrics. They want to know exactly how the business is running, why it's running that way, and what they can do to improve it in the future.

To this end, performance metrics are extremely valuable. They can help you determine how your employees are working, how productive your business is overall, and how your business might improve to increase output in the future.

That said, even under great conditions, your business might occasionally have to deal with the outcome of disappointing performance metrics. How should you deal with performance metrics that fall short of your expectations? And how can you set yourself up for better results in the future?

Falling Short of Expectations

Most businesses have performance benchmarks or goals in place, hoping to simultaneously motivate employees to work hard and offer an objective measurement of contribution for determining success. In principle, this is an excellent approach, but if you fall short of expectations, you'll need to take action.

One of the first things you can do is check your expectations to see if they were reasonable, objective, and valid. This can be challenging to do, depending on the context. Sometimes, you'll have access to data from other organizations and other contexts, which can serve as a sanity check for the approach you took in this context. Other times, you'll simply need to review the data that was available to you at the time to determine whether you set a reasonable goal or not.

Determine Potential Root Causes

A root cause analysis is one of the most important efforts you can make in pursuit of improved performance metrics. If you've fallen short of expectations, you owe it to your business to figure out why that happened. Otherwise, you probably won't be able to choose the right solution.

These are some strategies that can help you here:

· Study recent developments. Pay attention to any recent developments in your business that might have influenced this outcome. For example, did you have to deal with the sudden rise of a new competitor? Was there a material shortage that prevented you from producing as many products as you ordinarily would? Have the seasonal trends in your industry shifted recently? Sometimes, recent developments can explain the totality of your diminished performance.
· Note anomalies and outliers. You also need to look at anomalies and outliers in your data sets. For example, if your sales team failed to reach its goal, that might be because there are a handful of team members not pulling their weight – or because your overachieving, best salesperson no longer works for your organization.
· Conduct interviews. You'll get a fuller picture of what's going on by conducting interviews with the people closest to the problem. Talk to supervisors and managers, but also ground-level employees to get a better sense of what's going on. Are these people aware of their disappointing performance? What do they make of that?
· Look at other data. And, of course, you can study other data that can give you indications of what might be going wrong. For example, broad economic data can give you a hint about why your marketing strategies aren't working as well as they once did.

Apply Possible Solutions

After you conduct a root cause analysis, you'll be in a position to apply solutions you've developed specifically to resolve your unique issues.

· Employee motivation. It could be that your employees simply aren't motivated to meet their expected performance thresholds. Are you offering any meaningful rewards for employees who meet or exceed expectations? Do your employees know how much they're contributing to your organization?
· Resources and tools. The gap may also be because of the resources and tools available to your team, or lack thereof. Are you confident your team members have the technologies and backup they need in order to perform adequately?
· Bottlenecks and obstacles. Certain bottlenecks and other obstacles to productivity can make it hard for your organization to work as productively as it otherwise could. Are there any specific hiccups in your workflows or disruptions that might be responsible for this performance gap? If so, are there specific strategies you can use to resolve them?
· Direction and leadership. It's also possible that there's an absence of direction or leadership within your team, and this should become apparent if you conduct a sufficient number of interviews with your team members. If your employees don't know what goals they're trying to achieve, or if they don't have the guidance and support necessary to achieve them, they're going to fall short.

Dealing with disappointing performance metrics isn't always easy, especially if your organization isn't exactly thriving. But if you can get a grasp on this problem, and propose reasonable solutions, you can dig yourself out of this hole and return to productivity.