Recently, I have been challenged to understand the relationship between leadership and performance management. This relationship is important to understand because performance metrics are found everywhere. You can’t escape them. From test scores, to quotas, to yearly reviews, performance indicators are relied upon to assess your contribution to your organization. You are compared, ranked and evaluated against multiple numeric standards. Leaders in the private and public sector use performance information to sharpen (or maybe to justify) their decisions. Budgets, programs and even promotions may be affected by performance outputs.
The goal of performance management is to use metrics to improve efficiency in the use of resources.
Its reliance across sectors is due in part to the belief that numbers can’t lie. Yet, numbers can be highly subjective and even manipulated. Deciding what to measure is complicated. Measuring wrong data makes performance indicators unreliable. The quality of the data is essential in the use of performance management. Without clarity, metrics simply do not work. Therefore, performance management extends beyond numeric outputs. Leadership is required to make it work.
There are as many definitions of leadership as there are different performance management models. Leadership is more than charisma or tactical knowledge. In essence, leadership is granted, not given by positions of authority. Consequently, leaders do more than simply encourage people to act. Leaders energize on a human level and beyond the parameters of a specific task. They unite individuals behind a vision. They empower and develop members of the organization. They lead authentically and by example.
Leadership provides perspective in performance management. Executives refer to focus and alignment, non-numeric values, as the main reasons for achieving breakthrough performance in utilizing performance metrics. Focus and alignment are essential qualities in good leaders. Leaders bring focus by conceptualizing a vision that rings true to the members of the organization. They align a vision by providing clarity and integration.
Leaders must also understand the impact of metrics across various departments and individuals. They do this by behaving strategically. Strategic leaders are proactive, vision driven and focused. They are able to see the whole by stepping away from the tactical aspects of the organization.
Could there be a style of leadership that is most conducive to the success of performance management? In their book, Primal Leadership, Goldman, Boyatzis and Mckee, define six styles of leadership. These are visionary, coaching, affiliative, democratic, pacesetting and commanding. Interestingly, the research on performance management points out that no specific style of leadership is attributed to its success. Instead, leaders are called to adapt their style at different stages of the performance management implementation. For instance, leaders must be visionaries, articulating the purpose of the initiative in ways that ring true to those they lead. Leaders must have the ability to coach individuals through the learning and implementation of the new system. Leaders must be affiliative, focusing on the individual more than the task, in order to assess the engagement of employees and users during the performance system. Leaders must be democratic, receiving feedback to gain broader perspective and clarity on what to measure. At times, leaders are called to be pacesetters and must command accountability. Conversely, the necessity to adapt is not exclusive to leadership. Performance management systems are also expected to be flexible. One-size-fits-all approaches to performance management are not recommended.
Because performance management extends beyond the simple measurement and monitoring of organizational data, it must be examined from various viewpoints. The most significant determinant for its success is the role of leadership. Leaders must provide a clear vision and strategically align the organization to its overall purpose. Furthermore, leaders are needed to give data meaning. In turn, members of the organization will be engaged and empowered to support and maintain integrity in the measures. The dynamic relationship between performance management and leadership suggests that each has the ability to influence and be influenced. To be effective, leaders must not only adapt themselves, but also adapt the performance measures to meet the organizational needs and purpose.
