The Foundations of Performance Metrics

Recently, I gave a presentation to a diverse group of educational, healthcare, and non-profit executives on performance metrics for development officers.

For years I have helped leaders and teams create and implement performance metrics so I know in each audience there are a small percentage who can be turned off by the topic.  My sense has always been that they struggle to reconcile the adoption of a for-profit management strategy in the non-profit sector.

Non-profits and for-profits are different.  Non-profits serve different purposes, have different organizational models, and operate with different values as compared to our friends in the for-profit sector.  These differences don’t necessarily mean that we can’t learn from one another.  But some think this way.

And because the phrase “performance metrics” can conjure up feelings of cold, uncaring, bureaucracies, those folks think this concept is especially misplaced in the warm, cozy world of non-profit work – especially non-profit development work.  You may know a few folks  like this in your own shop!

But performance metrics in the non-profit arena can work – exceedingly well. However, in order for performance metrics to encourage the best possible development efforts there are three “foundations” that must be present.  These foundations are primary beliefs, perspectives, and cultural components that either the leader must hold or the team must hold collectively.

Here, then, are the Foundation for Performance Metrics:

  • A Belief in Disparate Rewards – Do you believe that team members who are fairly and accurately assessed and produce exceptional results should be rewarded for their work?  Even if the reward is not financial, is the concept of merit-based rewards one that resonates with you?  If not, then a performance metrics system is probably not for you.
  • An Understanding of Values – What does your organization value?  What does your team value in its work with donors?  These are two key questions that must be answered prior to establishing a performance metrics system.  If these questions aren’t answered with a good amount of team consensus, you run the risk of implementing a performance metrics system which is injurious to the organization, your team members, and your relationships with donors.
  • A Belief That Every Team Member Should Be Encouraged To Be Their Best – If you do not believe that the organization’s success will ultimately be built on encouraging each individual to be her best, then you probably don’t want to implement a performance metrics system.

The phrase “performance metrics” can cause some in your organization discomfort.   And the establishment of a performance metrics system can serve as a breakpoint moment for many on your team.

Those on your team who believe that rewards should be based on effort and productivity, who are willing to embrace important values, and who subscribe to the notion that every person should be encouraged to be their very best will flourish in a well-design metrics system.  For anyone else, a more important conversation might be in order.

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