Inspired to improve our ways, most of us have at some time read at least one self-improvement book. In fact, the self-improvement industry in the United States alone tops $11 billion, according to Tampa, Florida-based Marketdata Enterprises, Inc.
Whether we like to admit it or not, self-improvement requires action to get results and that’s the really hard part. Not surprising, organizations have the same problem compounded. When it comes to executing strategies and changing the way things get done, it remains business as usual for the most part.
According to recent IDC research, the business analytics software market is expected to top $33 billion this year. About 10 percent of that goes to performance management software. So on average, organizations spend about ten times more on decision-making tools than action management.
I’m not arguing against investing in analytics – far from it. Having lots of data and analyzing it in lots of ways is good. It’s a critical element of performance management, particularly when really fine tuning things. See Richard Barrett’s recent blog on Team Sky’s recent Tour De France successes.
If a typical enterprise-level performance management tool costs around $300K, that would equal an average investment of $3 million on analytics. The reality is that 70+ percent of organizations spend next to nothing on performance management software and instead cobble together make-do solutions using existing tools.
What’s the Process Behind Analytics Software?
You collect information, you report and analyze it, you make decisions, and then what? You still have to assign teams and owners; work on project activities; report status; compare performance; reprioritize, reallocate resources, make adjustments, and maybe change course altogether if the results aren’t what you wanted.
Given that the hardest part is taking action, why is it the part we seem to overlook? Perhaps it’s the somewhat esoteric nature of performance management that makes us question the value of spending money on tools that allow us to perform better.
Or perhaps what we’re dealing with is latent pain (in solution selling terminology) – where you’re not actively attempting to address a pain, because you don’t feel it or have chosen to ignore it, and you may be unaware that a potential solution even exists. Or you’ve failed at previous attempts to resolve the pain, and therefore you’ve rationalized other solutions as too expensive, complicated, or risky.
What Are Some Indicators that You’re Suffering from Ineffective Action Management?
You need to improve how you:
- Link objectives to key performance indicators and initiatives that must happen to achieve them
- Assign owners and teams to initiatives
- Provide visibility into the status of initiatives
- Align the organization around common goals, particularly IT and business units
- Manage a centralized repository of KPIs and best practices
- Drill into KPIs to determine the root cause of performance problems
- Collaborate with other stakeholders to proactively discuss critical issues
- Notify teams of below-horizon objectives that may be in jeopardy – automating the process
- Measure the impact of initiatives and allocate resources
- Compare business unit performance side-by-side or with other relevant benchmarks
- Gauge performance with easy-to-interpret scorecards
- Engage users – anywhere, anytime – via their mobile devices
If you struggle with any of the above, then you’re likely a good candidate for a performance management application – sooner than later.
One nice thing about performance management applications is they’re relatively quick to implement. We’re now halfway through 2012, maybe it’s time to lay the foundation for improvement in 2013 and beyond.