Hi, I’m Mark Debinski, Founder and Chief Talent Officer of Bluewater Advisory broadcasting again today from beautiful Fairhope, Alabama with Mobile Bay as our backdrop. Today’s topic of conversation has been a very hot topic with many of our clients lately and that is the topic of Performance Management Objectives – often referred to by their initials, PMO’s. I’d like to share with you briefly three things: what are PMO’s, how do they work and why they’re good for an organization.
First, what our Performance Management Objectives? Quite simply, PMO’s are where we identify the three to five key accountabilities for a given position and then tie measurements of results that we expect for that position. We identify the range of minimal acceptance, the range of good and then the range of excellence. Once we have our three to five key accountabilities and our ranges, we then apply a weight to each of those key accountabilities that corresponds to the relative importance of the key accountabilities.
How do they work? Similar to the way a student will bring home a report card that has a grade for each of the courses and then a weighted grade point average – we do the same thing with PMO’s. Once we have our objectives established, we measure results whether it’s monthly, quarterly, semi-annually or annually and based upon the ranges in which the results fall, we assign the proper score to those key accountabilities and our employee ends up with a grade point average of sorts with regard to performance in that position. Oftentimes, that GPA or that weighted average is tied to a bonus pool or an overall bonus opportunity for the given employee.
How could it be good for an organization? Well it could be good for a number of reasons. First of all, it provides crystal-clear clarity. If I know that that there are three to five things that are really important for my job and I know what constitutes minimum performance, good performance or exceptional performance, I’m going to be focusing my time and energy towards getting excellent performance, which is good for the company.
Secondly, it provides accountability throughout the organization. When you have objective measurements and you take away some of the subjective nature that often flows into the review process, it drives accountability throughout the entire organization.
We often create Performance Management Objectives when we help a client with a new hire and this time of year when clients are setting goals and objectives for the next calendar year we sometimes help clients with Performance Management Objectives for their entire organization. If done properly, it can drive not only accountability and clarity but also synergy within your organization and most of all results.
If you’d like more information on Performance Management Objectives, reach out to us at any time at Bluewater Advisory.
Thanks and have a great day.