Dr. André de Waal has performed extensive research into High-Performance Organisations (HPOs), making his findings available in his latest book. For example, he found that by focusing strictly on what is really important, these organisations achieve better results – both financially and non-financially – than their competitors or comparable organisations over a period of at least 5 to 10 years.
35 characteristics of High-Performance Organisations
He came to this conclusion after analysing more than 290 international studies conducted in the last 35 years in the area of high performance. In the mid-1990s, he tested the common characteristics that these studies most frequently highlighted by analysing the results of questionnaires sent to 3200 organisations in the profit-, non-profit and government sectors all over the world (the number of respondents has now risen to more than 35,000). This resulted in a list of 35 of the most important characteristics, divided across five categories. Additionally, he concluded that the turnover of HPOs grows an average of 10% more than that of non-HPOs, that profits are 29% higher, that the return on investment and return on equity is 20% better, and that shareholder value is 23% higher. The non-financial indicators are also higher for HPOs than non-HPOs: in other words greater customer satisfaction, higher customer- and employee loyalty, and better quality of products and services (source: What makes a High Performance Organisation, Dr. André de Waal).
Factor one: the quality of the management
Are you a reliable person, showing integrity? Are you also perceived as such by your colleagues? Are you considered a role model? How do you respond to making difficult decisions? Are you a good listener? Do you ask more questions than you give answers? And how do you deal with employees that are not functioning? These are just a few significant questions that need to be asked. So when we talk about ‘quality of management’ we’re not talking about how smart the manager is, or if he or she can formulate a good strategy, but more about how they deal with the people side of managing.
HPO managers are people who take responsibility for their results, who also expect this from their employees and who believe in some ideal, which they actively pursue with a clear vision they live by. They act in line with their personal values and the company values and make no compromises about them. These are people who coach and facilitate their employees, enhancing their performances, and encouraging them to get the best out of themselves. And employees who are not performing are immediately and clearly made aware of this, without shunning the need to take difficult decisions.
Factor two: openness and decisiveness
Within HPOs, taking part in open dialogue is a natural state of affairs (see also our article the conversation). Not just a dialogue between management and employees but also between employees themselves. And instead of employees being judged by the mistakes they make, a collective effort is made to analyse what happened, what can be learned from it, and how these mistakes can be avoided in the future. Perhaps even more striking: in a high-performance organisation, people are constantly experimenting with new ways of doing things, so it’s hardly surprising that mistakes are made. This is an important aspect of the organisation culture, allowing you to avoid the phase of ‘terminal seriousness’ (see the short film below).
Another aspect of the culture has to do with the fact that employees are more than just a pair of hands. They have a good set of brains and are able (and willing) to take on responsibility. Working for an HPO, they are given room to develop and they are expected to exchange their knowledge and experiences with each other. Additionally, the employees are actively involved in any modifications to essential business- and organisation processes: truly working together on growth and results.
Factor three: long-term focus
Managers at all levels within HPOs are aware that long-term results can only be achieved through effective internal and external collaboration. Internal collaboration begins with selecting high-quality personnel and ensuring that people from within the organisation occupy the management positions. External collaboration with suppliers, customers and society is encouraged. This means for example that the attention and energy spent in winning new customers will continue to be invested in the relationship with these customers. In other words, constantly asking customers what they think of the organisation, what options they can see to improve the collaboration, and what opportunities they see for achieving even better profits together. Becoming smarter and expanding – together. Where there is a choice between long-term profit and short-term turnover, the long term wins out. This requires courage, certainly within organisations that are shareholder-driven and where shareholder value is an important KPI. But as we said earlier: HPO managers aren’t afraid of taking difficult decisions.
Factor four: constant improvement and innovation
High-Performance Organisations have developed a strategy that enables them to distinguish themselves from the competition. Management and employees have committed themselves to this and will do their best to execute this strategy, constantly analysing how this can be best achieved. Are the existing processes and procedures optimally in place and are tasks and responsibilities clearly defined? And do they still contribute to achieving the desired results in a smart and simple way? If the answer is ‘No’, suggestions for improvements are proposed. If it transpires that specific processes are old-fashioned, then these processes will be discontinued. Additionally, the products and services offered are analysed critically. That means not waiting until customers start complaining and markets become agitated, but actively thinking about what is required for the future. Finally, these organisations realise full well what their core competence is. That’s where they excel and are seen as innovators in their field. If additional services or products are required, these will be sought in the market.
Factor five: the quality of the employees
The management of HPOs realises that diversity is crucial – not just diversity within the management, but also diversity among the employees. So employees are recruited who demonstrate a high degree of flexibility, who are focussed on constant improvement, and who are creative in finding solutions. The management of High-Performance Organisations is also fully aware that money is not the only motivating factor for employees, they also want to develop as individuals. So while investments are made in vocational training and education, attention, time and money are also constantly being spent on personal- and team development. Additionally, employees are given plenty of room and trust to enable them to think about innovating and improving processes and products/services, and to take responsibility for these, in collaboration with colleagues, suppliers or customers. This way, employees get the chance to learn from others and to become inspired by them.
Aiming to become a High-Performance Organisation?
Is your company or team a High-Performance Organisation? If you want to find out, or if you think you need some support in growing into a High-Performance Organisation, Team or as Manager, then feel free to contact us for a no-obligations talk about the opportunities and chances within your company or department.
Enjoy your work every day!
Reading tip: What makes a High Performance Organisation, Dr. André de Waal