Managing employees at a startup can be hugely challenging. Employees multi-hat almost daily, making it difficult to set clear performance measures. With rapid growth, metrics to track set goals change often (or there aren’t even metrics to track goals set). New goals and responsibilities get added frequently.
That said, ensuring that your team members are crystal clear about what is expected of them is absolutely critical. In larger companies, an underperforming team member might drag down the performance of their specific area but in a startup with limited resources, an underperforming team member can be the difference between existence and obscurity.
And let’s face it, if you are a business owner who previously worked at a larger company you probably “enjoyed” corporate bureaucracy as much as pulling teeth. I know for me, 360 meetings, performance reviews and basically, any other form of procedural formal process for timely feedback sometimes felt fruitless and at a small company like MTYsquared it definitely felt like overkill.
Here is how we think about performance management at our startup (based on our thoughts on what works at ours in particular):
So let me explain the above image…
Who is this for?
This is probably most fit for small companies of 2–20 people that have been around for at least 1–2 years. In these companies mechanisms to help issues surface tend to be very relevant and you are still very much in the phase of figuring out ‘what works best’ for your company and your clients.
What are the four quadrants for?
So firstly let me address the overall intent of the entire approach (like everything “Why” is way more important than “What” or “How”). The overall intent is:
To strengthen our company together as a team by discovering issues and getting everyone to work better and be happier in what they do, including me and to translate that awesomeness into positive, tangible impacts to our clients.
In today’s world things change – FAST! In order to remain competitive, relevant and ultimately get the best out of you and your employees there needs to be a concerted focus on helping people be “the best you, you can be”.
Related Post: What I wish I knew before starting a business (see point 3)
Typically in larger companies, you would find that in order to justify using company resources (time, money or otherwise) you would want/need your employees to ‘motivate’ why it benefits the company with the ‘best you’ being in relation to your job and nothing more. When thinking like this it can be easy, as a business owner or manager, to translate that into a narrow set of improvements that serve the needs of your company ONLY but don’t fall into this trap! Simply put there are two things to bear in mind when wanting someone to improve:
- People inherently want to feel a sense of accomplishment day-to-day
- People are motivated by things that are broader than just the work they do each day
When you truly understand this it allows you to set goals that help your employees achieve two critical outcomes:
- Allow them to become ‘the guy’ at something (i.e. what goals need to be in place that when achieved mean that person is the absolute expert at something that grows your company and can, with confidence, deal matters as they arise)
- Allow your employees to explore and fuel their passions through maintaining the best interests of your company (i.e. what goals need to be in place that when achieved will motivate your employees to bring the best of themselves to work each day)
Examples of some of the goals here could be attending training, listening to a podcast that really inspires you, reading a book to give you a fresh perspective.
Improved My Team:
A startups success is linked to specific team dynamics (up to 65% of startups fail specifically due to poor team dynamics) – an effective team that is even moderately skilled can and will outlast and outperform an incredibly technically gifted team with poor team dynamics. Further, unless you are the sole owner and employee no man (or women) can be an island. In situations where team dynamics is ignored it can, if it turns sour, add to problems like low engagement and high rates of interpersonal conflict and ultimately turnover.
The aim of the goals set here are to foster the traits of an awesome team. Examples can be as simple as saying sorry for being a bit grouchy on a particularly bad day, organising team building to knowledge sharing something you have learnt that will benefit the rest of the team.
Improved My Company:
The goals here are the ‘more traditional’ ones. You either need to be making more money or running your company more efficiently if you want to stand any chance of survival (and growth). In order to achieve this though, the primary motivation should not be the pursuit of money – money, when running a business, is an outcome. It should be treated like any other resource in the pursuit of sustainable, equitable and awesome impacts and experiences.
There are three main types of actions that occur in a company:
- Things that directly lead to you creating a sustainable business (i.e. making money) = figure out how to do as much of this as awesomely as possible
- Admin tasks that you are mandated to do so that you don’t get into trouble (i.e. sending a customer statement or submitting tax returns) = figure out how to do these things as efficiently as possible (or ideally not at all via the smart use of technology)
- Everything else = ruthlessly evaluate whether the things in this bucket need to be done at all and err on the side of ‘laziness’.
Improved My Clients:
This is often an area that business owners and managers just assume. They assume that because they train people, have awesome teams and are running a decent company making loads of money that they must inherently be improving the lives of their clients. This is a flawed assumption.
If you want to truly leave a meaningful impact you need to be deliberate about having clear goals around the experience your clients should have with any interaction with your company. The other three quadrants should work congruently towards meeting the goals set for this quadrant. When you can delight your clients with the way in which you solve their problems through the use of your offerings you are onto something awesome.
Your existence as a company relies on your continued relevance to your clients. The goals you set here should not be in ‘money goals’ (unless it is in the sense of making money for your clients). They should be in terms of answering one simple question for your clients – “How can we create value for our clients.”
I hope this article helps you out with your how to build an awesome team/company (or at the very least sparked some thoughts on the matter).
If you want to discuss things you are struggling with specifically feel free to hit me up on any of the social media (& other) channels I am on and if things are ‘really tough’ we offer expert advice to entrepreneurs/startups to take their great ideas and turn them into awesome businesses!
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