Managing performance – not just KPIs

by 30 Nov 2011

Organisations are no longer simply basing performance reviews on employee’s achievements; they are also considering how they go about achieving their goals. So while an employee may exceed their sales targets for the quarter, managers need to know how they did this; for example, was it through bringing in new clients, or by poaching clients from others?

More comprehensive performance reviews affect the culture of a workplace and can help to improve levels of employee engagement and thereby encourage higher retention rates. If behaviours are not managed, then there may be an increased level of costly collateral.  For example, while staff may meet sales targets, if it is not done through acceptable behaviours, the organisation may lose staff who feel alienated by the behaviour of others, or lose clients who feel they are working with an untrustworthy person. While in the short term there is the apparent success of sales targets being met, later on the organisation may suffer from low retention rates, unhappy clients or customers and the resulting impact on revenues.

Creating a culture of acceptable behaviours has to be a whole system approach. Without that support, the culture and values will remain unchanged and be potentially damaging to the business.

Where to begin

The place to start is to create (or recreate) a culture that includes a vision of the business that places value on behaviours based around integrity, honesty and accountability, rather than the importance being placed only on numeric targets. Consider what values you would like your employees to have and how they can apply these in their daily tasks.

This culture, once established, should be communicated throughout the organisation to ensure every employee is aware of it. Then leaders, from the CEO and senior executives through to team leaders, should be role models for the behaviours. They need to communicate acceptable behaviour through not only telling employees what is expected of them, but by modelling these behaviours every day in their work and duties.

Another way to encourage the desired behaviours is to recognise and reward them. Sharing stories - whether through email, the intranet or videos - is an essential tool to foster a positive workplace culture. Recognition and reward are also effective motivators for employees to modify their behaviour and seek ways to emulate the examples of their leaders.

As a leader, ensure you follow through on your commitments to build trust within the organisation. Have conversations with staff to manage perceptions and commitment about managing behaviours in the workplace.


The benefits of implementing performance management around behaviours are far-reaching in an organisation.

They include:

  • Increased retention rates and higher employee engagement – employees who feel secure, motivated and supported by those around them are more likely to put in discretionary effort and exceed expectations without having to be asked.  Unacceptable behaviour from others may drive an employee to leave an organisation, especially if that behaviour appears to be rewarded.  Rewarding the right preferred behaviours creates a sustainable business where employees care about each other and are willing to go that extra bit further to ensure success.
  • Happier clients – clients who are receiving top service from employees exceeding expectations are going to be far happier than those who have to deal with unhappy employees who resent their colleagues or workplace.  Attitude is everything when it comes to providing a great service.
  • Increased revenue –the benefits already mentioned will have a positive impact on the revenue of a business through lower staff replacement costs, higher productivity from happy staff and increased customer/client loyalty. 

Creating a culture of behaviours based around an organisation’s values is not a process that can be implemented overnight. Long-term change takes time to have an effect, but once an organisation decides to travel this path, they will see how the benefits are impacting positively on the business as a whole.  Scorecards at work are no longer just about what an employee has done, but also how they have done it.

About the author

Chip McFarlane is the director of the Institute of Executive Coaching. The Institute of Executive Coaching works with organisations to provide innovative leadership and coaching support to improve the performance of individuals, teams and organisations. Visit for further information.