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How to Improve Performance With Metrics

“Leaders in areas like facilities, the HR department, the finance team … all had to more consciously and deliberately find their link to the goals of the organization.” Susan Norton, Georgia Regents University

Georgia Regents University embraced a new approach to fostering organizational effectiveness by creating a metrics-driven incentive pay plan for leadership positions. They shared their story during the CUPA-HR Annual Conference and Expo 2013.

The plan was intended to encourage senior leadership to work together around a common set of goals and enable shared impact among leaders on their total cash compensation. The plan included 50 original participants, 2.5 percent investment from the base pay of all participants and no payout unless metric targets were achieved (threshold-2.5 percent; target-5 percent; high performance -7.5 percent). Georgia Regents University.

Among the key lessons learned from this initiative were:

  1. Even small amounts of money can shape behavior and improve organizational effectiveness: focus on goals, teamwork and performance.
  2. The metrics matter: having an incentive plan requires being skilled at selecting metrics, setting goals as well as tracking and reporting progress.
  3. Leadership support is critical: there were enough skeptics and distractions during the creation of the new plan that without a determined leader, the project would not have been a success.
  4. Readiness matters: it takes longer than you think but extended stakeholder engagement helps people get on board.

Are you using an incentive pay plan at your institution? What lessons have you learned in doing such work?

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