Let’s go to PERI
My kingdom for want of a nail is a favorite story that speaks with attention to detail. The story tells of a king who falls during battle due to badly shoeing his horse. For want of a nail the horseshoe was lost, for lack of a horseshoe the horse was lost, for lack of a horse the king was lost, for lack of a king the battle was lost, for want of a battle the kingdom was lost. Thus a kingdom for want of a nail.
Attention to details of performance monitoring is a daily activity. Understanding how numbers drive performance is critical to the success of any trading system. The day to day works like the nail of a company and if it is not executed correctly the kingdom can and will be lost.
Let’s PERI is the vehicle that creates the infrastructure for success. The goal is to plan, execute, review, and improve. PERI is flexible for daily, weekly, monthly or quarterly use.
Planning
Planning is vital to any endeavor. As Steve Covey writes, start with the end in mind. What is the desired result? How much time to invest? What is the desired end date? This exercise allows managers and staff to align expectations by creating an environment of shared understanding rather than debating tastes. The manager sets the strategic parameters while the staff creates the tactical plan. Both parties have a voice in creating the intellectual vision of how the performance will unfold.
Execution
The military maxim that no plan survives contact with the enemy is the guiding principle for execution. Once the planning is complete, set a date and boldly move forward. Train front-line employees to call an audible or make adjustments as circumstances require. Develop freedom by training decision-making skills with a firm understanding of the mission. Management must accept aggressive mistakes. Creating a workforce that cannot move without management approval is a handicap in today’s world.
Check
As Peter Drucker said: “Follow effective action with silent reflection. From silent reflection, more effective action will come.” Small organizations pressured by today’s concerns don’t spend time reviewing performance. Leaders are action oriented and looking back is not a priority. This is a critical error. The process of comparing the results with the forecast is essential. Understanding how the assumptions fared during execution will validate the strategy or dictate the need for change. The dual approach is understanding whether the tactical objectives are being accomplished at the intended speed, quality, and volume and whether the results appear as designed.
To get better
PERI’s engine is continuous improvement. This requires enlightened leaders who maximize the potential of people and processes as master coaches. Regularly scheduled coaching sessions discuss performance deltas and create plans for corrective actions. This process has a positive uplifting style that seeks to improve performance and confidence. Addressing performance issues early enables behavior changes that prevent problems from escalating and mistrust from developing. Forecasts and assumptions are improved by methodically understanding how events happened, followed by refining highly accurate and complete models.
Profits
The PERI cycle lays the foundation for capacity plans, performance dashboards, policies, and procedures. Capture institutional knowledge, reduce attrition, and deliver peak performance. This process provides the data for the illustrated run. But data alone does not produce superior results. The second step channels the emotions of the workforce toward success by creating a culture of improvement.