Imagine joining Netflix before anyone knew what it was. You received a job description before starting. On day 1 your boss gets you started on your key responsibilities. Whether your role is to sign movie licensing deals, develop their software or provide customer service, as often happens for a large majority of people, your sense of engagement will likely start strong and then wane in the months following the honeymoon period.
But now imagine what would happen if before you even started, you knew the purpose for Netflix and how you fit in. You knew they wanted to create the worlds most popular movie and TV streaming service. They wanted to give people access to the shows they loved on-demand, a completely new idea.
The people you worked with continually talked about this picture of the future. How much more engaging and motivating would it be? You’d have a purpose beyond your end of week pay packet. As Hubspot’s culture code puts it: “paychecks matter but purpose matters more.”
Individual performance (and subsequently overall business performance) dramatically improves when employees know why they are doing their job. It’s further enhanced when people know how their job impacts or contributes to the goals of the business overall.
The key benefits of a sense of purpose
Maintain a sense of purpose at all levels in your organisation – linking everyone’s job to the bigger picture – and your business will reap the rewards:
- Significantly higher engagement – which lowers absenteeism and turnover and increases productivity
- A faster business – with everyone pulling in the same direction you can achieve your goals more quickly
- A more innovative business – having a clear direction promotes more creativity
Well-executed performance management clearly defines the link between an employee’s job and the objectives of the business – day in, day out. Here’s how:
1. Clearly articulate company goals to everyone
Sharing your company’s goals is the starting point for both purpose-driven employees and great performance management.
Creating a sense of purpose at an individual level starts with the leadership team asking “why do we do what we do?” – then clearly communicating the answer to the business. In his 2010 TED talk, Simon Sinek makes a terrifically powerful appeal to leaders (it’s worth watching):
“It’s those who start with “why” that have the ability to inspire those around them.”
Transparent company goals that are communicated clearly and often lay the foundations for a workforce driven by a shared purpose. They are also the bedrock for effective performance management.
At its core, great performance management ensures that employees are aligned with the business as it moves forward. It has the power to ensure the right people are in the right roles, doing the right tasks and developing their skills in line with business needs.
Of course, in order to do this job effectively, performance management relies on every employee understanding the fundamental goals of the business.
2. Align employee goals with business goals
Give your employees purpose by clearly explaining exactly how their job affects the success of the business. A crucial step in the implementation of a great performance management system is giving goals this context.
The SMART approach is a best-practice method for setting goals (specific, measurable, attainable, relevant and time-bound). The ‘R for relevant’ is the key here – make sure all goals are clearly relevant to the business’s purpose.
For example, using the idea in our introduction, if you were setting a goal for a HR executive, an aligned and purposeful objective would be to “Contribute to successful commencement of services in Australia by establishing a leadership team by January 2015 with proven past successes building operations from the ground up”
At Netflix, giving employees context is ingrained behaviour. The Netflix culture code captures this by saying: “High performance people will do better work if they understand the context.”
But it’s not just Netflix that says so – research backs up the statement strongly. If you’re interested to read more on this, I can suggest two papers from the Center of Advanced Human Resource Studies: ‘Seeing Clearly’ from this collection of white papers and ‘Employee line of sight to the organisation’s strategic objectives – what it is, how it can be enhanced and what it makes happen’.
3. Use performance management to maintain a sense of purpose when things change
Business objectives, and subsequently business strategies, can change in a heartbeat – especially in fast-moving, innovative organisations, or those facing fierce competition, regulatory upheaval and so on. Change can mean that job roles quickly become misaligned with the new direction of the business. To keep your employees on the right track and adding value despite shifting sands, ongoing feedback and coaching is crucial.
The effect of coaching on purpose and engagement hasn’t gone unnoticed at Wells Fargo. A top executive announced last year that he expects bank managers to spend two thirds of their time coaching their staff.
Ongoing feedback and coaching are key elements of best-practice performance management. Providing plenty of contact time between employees and their managers/mentors, regular feedback means new strategies can be quickly implemented on the ground.
Done well, every coaching and feedback session will leave your employees feeling that achieving their individual goals are directly connected to the success of the business.
A sense of purpose lies at the very heart of driving employee engagement and better business performance.
Great results happen when every employee is connected to purpose, every day. Best-practice performance management makes this straightforward.
With clear goals, feedback and coaching, your employees will have a direct and tangible connection to the success of your organisation.
Jon Windust is the CEO at Cognology – Talent management software for the future of work. Over 250 Australian businesses use Cognology to power cutting-edge talent strategy. You can follow Jon on Twitter or LinkedIn.