CEO’s critical role in performance management

WELCOME to our special monthly series called Bible School Business School (BSBS). BSBS takes insights from the culture and history of the ancient near East as depicted in the Bible and applies these insights to business, leadership and personal development. BSBS aims to broaden our mindsets beyond the Western paradigms on business, leadership and personal development. 

Report by   By Brett Chulu
This article seeks to show how the active involvement of the chief executive is critical to driving a successful performance management initiative that yields above-market returns.
The following excerpts from what is famously known as the parable of talents will be used to draw insights on how business leaders can strategically manage performance.

 
Matthew 25:14 (KJV) reads: “For the kingdom of heaven is as a man travelling into a far country, who called his own servants, and delivered unto them his goods. And unto one he gave five talents, to another two, and to another one; to every man according to his several ability; and straightaway took his journey.’’

 
Matthew 25:19-22 (KJV) continues: “After a long time the lord of those servants cometh, and reckoned with them. And so he that had received five talents came and brought other five talents, saying, Lord you delivered unto me five talents: Behold, I have gained beside them five talents more. His lord said unto him, Well done, thou good and faithful servant: Thou hast been faithful over a few things. I will make thee a ruler over many things: Enter into the joy of thy lord.’’

 
Likewise the servant with two talents gained two more and was commended like his five-talent colleague. In sharp contrast, the one-talent servant buried the resource he had been given by the master, accusing his master of being a tyrant.

 
Matthew 25:26-28(KJV) continues the narrative: “His lord answered and said unto him: ‘You wicked and slothful servant, thou knewest that I reap where I sowed not, and gather where I have not strowed (scattered seed): Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury (interest). Take therefore the talent from him, and give, it unto him which hath ten talents’.’’

 
Talent-culture-leadership integration
The primary takeaway from this parable is that the chief executive (master in the parable) should intertwine talent, culture and leadership to drive organisation-wide performance. In other words, the chief executive fully embraces the strategic HR agenda. Strategic HR is concerned with how talent, culture and leadership can be harnessed to meet or exceed the expectations of external customers, investors, regulators and the community.

 
The parable of talents demonstrates how talent, culture and leadership must be fused together to deliver on superior business performance.

 
First, for performance management to permeate the entire organisation, the chief executive must set the tone. The chief executive in the parable did not leave it to the formal HR function to champion performance management. Performance management initiatives in which the top leaders of an organisation do not take a primary role are doomed to fail. The master in the parable embodied what is referred to as the leadership brand. Leadership brand is a concept birthed by the RBL Group, a US-based strategic HR think-tank. A leadership brand occurs when the expectations of customers, investors and other key external stakeholders at all levels of an organisation are converted into thinking patterns and behaviours of executives and managers.

 
Second, the leaders at all levels in the organisation must turn the expectations of customers and investors into consistent employee behaviours. Put differently, the leaders must translate the leadership brand into a company culture by influencing employees to think and behave in ways that deliver on the expectations of customers and investors.

 
In the parable, the expectations of the investors were clear: From the conversation between the chief executive in the parable and the unfaithful servant, we can infer that the investor wanted returns that were more than those obtainable in the financial markets. This is inferred from the statement recorded in Matthew 25:27 (KJV): “Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received my own with usury.”   Save for the one-talent servant, the other servants evidently delivered performances that brought in returns in excess of the financial markets’ benchmarks. This demonstrates that the master had successfully built a culture of harnessing employees to deliver above-market returns. What made it a culture was that it was not just one employee who delivered above-market expectations, but the majority of employees.

 
Third, the leaders must ensure the organisation has the talent needed to deliver on the expectations of the customers and investors. In strategic HR, talent refers to the simultaneous presence of the right skills and right attitudes. The master in the parable segmented his employees according to their skill levels. The chief executive in the parable did not hesitate to shepherd out the servant who demonstrated behaviours that were at variance with the expectations of the organisation’s customers and investors. Equally, the chief executive generously rewarded the servants who delighted the customers and investors. Talent is servantship.

 
 Example
The insights that we will share here are drawn from my brief experience as a senior executive for a local independent weekly newspaper (neither this paper nor any of its sister publications).

 
For a newspaper, getting the paper out on time is critical from a customer’s point of view. Both advertisers and readers expect the paper to come out on time. To deliver on this customer expectation of timeliness, all the executives and managers of a newspaper business must develop a leadership brand around timeliness. Timeliness must become both an internal and external reputation.

 
For the editorial leadership, this translates into facilitating and ensuring deadlines (I prefer calling these lifelines) are met. If the editorial staff manages to complete their work on time, it does not necessarily translate into a culture. If the production team fails to print the paper on time, customers may not care to know that the editorial team did its part. If the production team meets its ‘lifelines’ but the distribution team fails to take the paper to the selling points on time, again, the customer may not care that the paper was produced on time. Leaders of support functions in a newspaper business are equally bound to exhibit the leadership brand of timeliness. For instance, leaders of finance and distribution should ensure that critical financial resources are availed on time to enable editorial and production teams to meet critical lifelines. If a reporter fails to submit a report on time owing to late disbursement of resources from the finance department, this may have a systemic effect on the whole production process, resulting in the paper getting to customers very late. Talent, the third pillar of strategic HR, is vitally critical to achieving timeliness. For instance, the ability to write reports that minimise sub-editing and numerous editorial revisions is critical to achieving overall timeliness.

 
When all the leaders in a newspaper business think and act timeously and proceed to influence every employee to consistently think and act timeously, the newspaper will have developed a culture or reputation that resonates with what matters most: its customers.
CEOs must prioritise leadership, culture and talent agendas for performance management to impact on business performance.
To be continued in the next instalment of BSBS.

 

 

  • Let’s discuss at brettchulu@consultant.com.