February 18, 2008

Points for Losing

The new format of the one day cricket gives the chasing team a percentage of the target as a floor and they need to score at least that much to prevent the other team from gaining a bonus point. In yesterday's one dayer between Aussies and India - India was chasing and this floor was set at 162. Unfortunately India could not reach this total and Aussies gained the extra bonus point. It seems there was an earlier rule of rewarding a losing team if they managed to 'cross over' this floor.

This got me thinking to the appraisal cycles that we have going on internally. I wanted to see if 'earning points even when losing' applies to business functions independently.

Let's say we evaluate the performance of an entry level sales resource who is part of a team responsible for generating and managing both inbound and outbound leads. What are the parameters that will drive his evaluation. 'Speed', 'Efficiency' and 'Quality of work' are all irrelevant. Especially since these are not computationally mappable to tangible results. In other words - they are simply unmeasurable.

What is measurable however is that has he been slow in getting work done - how many times has he had to work overtime to finish the same quantum of work. Now this can hint at efficiency. How many people is he able to talk to in a day can hint at Speed. Net size of opportunity he generates can hint at quality.

But assume neither of his leads close into business. What does his evaluation say?

This is the most critical aspect of evaluation for M&S teams. And HR people need to very clearly specify this right at the start of an appointment - is the evaluation based on results or process.

That's because if its PROCESS - then the 'liability' rapidly spreads over the resource and he becomes accountable to the 'quantum of work' he is given. He does not choose the quantum of work and only 'Walks the Line'.

If its RESULTS - then the 'liability' moves away from the resource. The involvement becomes more personal and then it's the resource who decides if he wants to get into this. In other words - does the company pay him to increase revenues?

HRs frequently confuse the two. Especially since M&S teams are asked to follow procedure but evaluated on results. They are told to do things a certain way and then corrected if results don't show. And for M&S functions - results are all revenues.

So assuming your M&S team is 'losing'. That means you are holding them against revenues and they don't deliver. Or you hold them against processes and they break the rules but get revenues no matter what. What do you do? Do you let them go?

The bottom line is that do teams get points for losing cause they fought hard?

I feel this rule can and should be customized for different functions. But at the same time, it needs to be carefully integrated with evaluation of M&S staff since they are the 'revenue generators' of the business. Good or bad is relative when you look at one specific in reference to the other.


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